Rapid River Schools sell refunding bonds
RAPID RIVER — The Rapid River School Board recently announced the successful sale of its $3.075 million 2017 refunding bonds.
The district sold the bonds in the capital markets on Feb. 15 and the refinancing will close today. The bonds are being issued for the purpose of refunding a portion of a prior bond issue of the school district.
“Rapid River Public Schools is very pleased to report the results of this bonds sale,” said Dr. Jay Kubertis, superintendent. “We are grateful for the generous support of our school community. The refunding bond issue will save the taxpayers more than $219,000 over the remaining life of the issue. Just like a homeowner refinancing a mortgage to reduce the interest rate, the district refinanced to lock in substantially lower interest rates.”
S&P Global Ratings (“S&P”) applied its rating on the Michigan School Loan Qualification Program, giving the program a “AA-“ rating. The Rapid River bonds are qualified for the program and benefit by receiving the additional rating and security of the state program backing.
Additionally, the district was rated “A” by S&P, largely as a result of limited economy with access to employment opportunities in nearby communities, good income and extremely strong market value per capita, maintenance of strong reserves and moderate overall debt level.
The bonds were sold at a true interest cost of 2.90 percent.
“Rapid River was fortunate to find a receptive bond market on the day of pricing. We faced a challenging market, with investors hesitant to participate in anticipation of tax policy changes and an expectation of higher interest rates. We are grateful to have completed a successful sale in spite of the conditions presented,” Kulbertis said.