In a move estimated to save taxpayers over $7 million, the Board of Trustees adopted a resolution last Wednesday to refinance some of the school’s 2002 Measure P bonds in order to take advantage of lower interest rates.
Approximately $150 million in general obligation bonds intended to fund repairs and rehabilitations to the school facilities were approved by Pasadena Area Community College District voters in March 2002. Some of that money has since gone to projects like renovating the Campus Center and building the Center for the Arts and Informational Technology building.
Of the original $150 million, $37 million are able to be refinanced from a 4.94 percent interest rate to an estimated current market rate of 2.38 percent. The interest rate change will be the only part of the bond modified during the refinancing, all other payment terms and schedules will remain the same, according to Trustee John Martin.
“It’s $7 million!,” Martin exclaimed.
The $7.19 million, or 16 percent, in savings is expected to accumulate over the 15 years of the bond life.
The initial cost to issue the refinancing will be just over $150,000.
Rueben Smith, executive director of facilities and construction, said the change will not affect any facility plans.
“This is great for the school, it’s great for the taxpayers,” said Trustee Jim Osterling.
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