School bond maneuver will generate $2 million for LVUSD





By Stephanie Bertholdo
bertholdo@theacorn.com

The Las Virgenes Unified School District (LVUSD) Board of Education recently took action on a previously approved bond issue that will help fund major projects later this year.


Measure R was approved by the voters in 1997 by a two-thirds majority. It finances school projects by generating money (a maximum of about $93 million) through property taxes.


Timothy Carty, managing director of Municipals Securities Group, explained that the process of refunding bonds is similar to mortgage refinancing. With interest rates still low, LVUSD will generate $2 million while lowering the long-range tax to homeowners. In the short term, they’ll pay a higher tax per year, but homeowners will save money in interest over the life of the loan.


Series C Bonds totaling about $18.5 million were issued in March 2001 at a higher rate than is currently available. Property owners were paying $20.41 per year of $100,000 assessed valuation of their homes. In the 2002/2003 school year, the tax went to $29 per $100,000, but when Series D bonds were issued, a 93- cent increase was authorized and tacked on to the total bill. Carty explained that new structure will have the same effect as refinancing a 30-year mortgage down to a 15-year term with a lower interest rate.


The school district needs money for capital projects.


Two scenarios were introduced to board members. Under the first plan, the district would get $750,000. But the second plan would produce $2 million, which board members felt would go a long way with the construction and relocation of the new Yerba Buena Elementary School and other projects.


"There’s no question we have to generate new money for new projects," said school board member Cindy Iser.


Carty said that stipulations would be included in the refunding bond agreement, including that the transaction will only take place if the interest rate is lower. Currently, the Series C bonds are yielding just under 5 percent.


"We would proceed with certain parameters," Carty said. "If rates went up significantly, we wouldn’t go forward."


Board member Gordon Whitehead, a CPA, calculated the increase at $18 per year for a million dollar home if the property were held for one year. In the year 2020, the figure would rise to $139.90, he said. The increase is in addition to the original voter-approved level of $29.93.


"Taxpayers are getting more facilities in the long run for slightly less (money)," Carty said.



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