Rockford board approves authorizing resolution to pursue refunding of 2016 bonds
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Summary
Trustees authorized administrators to pursue refunding of callable 2016 bonds after hearing from PFM advisors, who estimated roughly $5.8 million in lifetime savings (about $4.2M net present value) and average annual cash‑flow savings of ~$321,000. The roll‑call motion passed unanimously.
The Rockford Board of Education voted in January to adopt a bond authorizing resolution allowing district staff to pursue refunding of the district's callable 2016 bonds.
PFM Financial Advisors partners Carrie Blanchard and Erin Wright told trustees the market presents a strong refunding opportunity. "Based on current rates, this would be worth just under $5,800,000 in savings over the life of the issue, roughly $4,200,000 in net present value," Blanchard said, and estimated an average annual cash‑flow reduction of about $321,000. She said the new interest rate would be roughly 3.73% compared with the prior rate just under 5%.
The resolution the board approved does not commit the district to issuing new bonds; it authorizes the administration to prepare offering documents, seek bond ratings and, if market conditions remain favorable, proceed with a refunding that would place proceeds in escrow to pay off the prior bonds on the call date. Blanchard said the savings would be reflected in reduced debt payments and returned to taxpayers through lower future debt service, not used for administrative spending.
Trustees asked procedural questions about timing, market sensitivity and past refunding history. PFM noted the district has pursued refundings multiple times since the 1990s and has realized substantial cumulative savings. The motion to approve the authorizing resolution was passed by roll call; trustees present registered affirmative votes and the resolution carried.
Next steps for staff include preparing the official statement, applying for ratings, coordinating with an underwriter and returning to the board for any required approvals once final rates are known.