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Mahtomedi board ratifies sale of refunding bonds, expects $1.5 million taxpayer savings
Summary
The Mahtomedi school board approved a resolution ratifying the sale of $20.85 million of 2025A refunding bonds to replace 2014 bonds; the districts municipal advisor and the successful bidder reported about $1.5 million in present-value savings and a true interest cost of 2.97%.
The Mahtomedi Public School District board on Monday approved a resolution ratifying the award of sale for $20,850,000 in refunding bonds, authorizing issuance of Series 2025A bonds to replace outstanding 2014 bonds.
The measure passed after a presentation from Matthew Hammer, the districts financial adviser, who told the board the timing captured a market dip and produced favorable results. "We saved about $1,500,000 for taxpayers," Hammer said, and KeyBank was the low bidder with a reported true interest cost of 2.97 percent.
The board approved a parameters resolution earlier in the month; Hammer said the sale came in well under the districts reset parameter of 3.7 percent. He said the district issued less principal than remained on the 2014 issue because premium bids reduced the needed par amount. "The coupon rates were the same, but we're in a market that offers premium bids," Hammer said.
Nut graf: The refunding replaces roughly $22 million of remaining principal on the 2014 bonds with a smaller par amount and a premium that together yield about $1.5 million in projected savings. The board authorized the transaction to lock in those savings and maintain the districts debt posture.
Hammer told the board the districts underlying credit rating of AA- — as reported to him during the sale process — helped secure strong market interest. "It puts you in the top 20 percent of districts that have ratings with S&P," Hammer said, adding that the rating helped deliver favorable terms.
Board discussion was brief and congratulatory. Director Dunn thanked the finance team and advisers; Superintendent Tim and other directors reflected appreciation for the timing and preparation that led to the result.
The board voted to ratify the award of sale for Refunding Bonds Series 2025A; the motion was moved by Director Donna and seconded by Director Peterson. The chair called the ayes and declared the motion carried.
Ending: District staff will complete the closing and follow standard post-sale reporting; board members said the savings will help the districts fiscal position as it plans for next years budget.
