The Albany Unified School District decided to sell a $10 million bond to construct a new swimming pool at a meeting Tuesday.
The pool bond was approved by Albany voters in Feb. 2008. The district had postponed its issuance because of the volatility of the financial markets and budget uncertainties. David Glasser, President of Board of Education, said it is a good time to sell the bond right now.
“Interest rate has come down, ” said Glasser. “We think it is a better time for us to access the capital market than a few months ago. “
He said that the average interest rate for California school district general obligation bonds currently is more than one point lower than the number in February. The average interest rate was about 6 per cent then, and it was about 4.8 per cent last week.
Superintendent Marla Stephenson said the district plans to construct the new pool in about half a year — January 2010, and needs to get money from issuing the bond.
All five Board members voted for the bond sale resolution Tuesday. The district is now inviting institutional investors to bid for the sale, and will select a bidder who proposes the lowest interest rate cost in late June. If the bidding process goes smoothly, the selected underwriter will announce the specifics of the bond products and start selling them to the public in July.
The district also decided at the same meeting to refund an older bond to cut some financial cost. Glasser said that the district could save about $210,000 in interest rate by refunding a portion of the bond approved by Albany voters in 1993.
The district has issued a total of $43 million bonds since 1998, and pays about $3 million each year for the debts. (Click here to read on Pg. 125-126 for detailed numbers.) The money comes from property tax.
Glasser said that the Board once discussed about delaying issuing the bond, but decided to go ahead with the pool project because “the community has voted for the facility and paying tax for it.”
Article by Linjun Fan.
Earlier stories on the pool project: