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Novi Schools save over a million by refinancing bonds
February 8, 2017

NOVI, MI - The Novi Community School District is saving taxpayers over $1.3 million in interest costs through a recent refunding (refinancing) of voter-approved bonds. The School District refunded $23,235,000 in previously sold bonds to take advantage of reduced interest rates in the market.

The Novi Community School has refunded (refinanced) a total of $56.25 million of bonds over the past five years leading to almost $6 million of interest savings. The savings from these reduced interest payments are passed on directly to the taxpayers of the Novi Community School District.

In addition to the refunding, the district issued $12.23 million in new bonds to finance projects approved by voters in 2014. In preparing to sell the bonds, the School District, working with its financial advisor, PFM Financial Advisors LLC, requested that Moody’s Investors Service evaluate the School District’s credit quality. Moody’s assigned the School District’s underlying rating of “Aa2”. The rating agency cited the School District’s sizable and affluent tax base, improved financial operations with satisfactory reserves and positive enrollment trends in their rationale for rating the School District at this level.

“The Novi Community School District is pleased that we were able to refinance bonds and save our community taxpayers money,” said Superintendent Dr. Steve Matthews. “These bonds have provided us with needed capital over the years to upgrade and maintain our buildings. We have appreciated the support of our community in working with us to support the education of the students in Novi.”

Brenda Voutyras, managing director with the brokerage firm Stifel, states: “Novi Community School District's bonds were well received by the bond market. We were able to take advantage of current rates that met the goals of the District and provided a lower cost of borrowing than originally anticipated and resulted in a nice savings that will be passed on to the taxpayers.”