Barton Community College expects to see a final total savings of $1,167,821 when it refinances the college’s outstanding 2013 Certificates of Participation, Vice President of Administration Mark Dean said Tuesday.
The BCC Board of Trustees approved a resolution authorizing the action. (A related resolution was approved in September.) The average interest rate on the 2013 Certificates in the amount of $4.76 million was 3.64% and the final average interest rate after refinancing is 1.60%.
The college will apply $1 million of its cash reserves to reduce the amount owed on certificates outstanding. In addition, certificates will be retired in 2033 rather than 2038, while maintaining approximately the same annual debt service payment.
“Industry guidelines suggest that a refinancing be reviewed when the present value savings percentage exceeds 2-3%,” Dean told the trustees. “This present value savings percentage for this refinancing is 16.61%.”
The 2013 Certificates were used for construction of student housing. Bluestem Hall opened in 2014, adding room for about 50 additional residents in the student housing complex.
This isn’t the first time the college has realized savings by financing debt as interest rates fell. The college saved over $300,000 in 2015 when it refinanced its debt on the Library renovation and an addition to the Technical Building, paid for in 2008 with certificates of participation. In that case, the average interest on the outstanding Series 2008 was 5.13% and the average rate of the refinanced certificates was 3.34%.
Neighborhood Revitalization Plan
The trustees also approved the 2022 Barton County Neighborhood Revitalization Plan (NRP) resolution, a resolution that has also been approved by other taxing entities.
County Appraiser Wendy Prosser provided information about the NRP earlier in the month. It is a tax rebate available for eligible residential, agricultural, and commercial/industrial properties that have new construction, rehabilitation, or remodel of structures occurring after Jan. 1, 2022 and continuing for 10 years. The rebates are on the portion of the taxes that would be generated by the increased valuation. Although that means taxing entities don’t immediately reap the added revenue from increased valuation, it pays off down the road. Meanwhile, Prosser stated in a letter to the trustees, “you will help promote revitalization and development by stimulating new construction and the rehabilitation, conservation, or redevelopment throughout Barton County.”
Similar plans have been approved over the years. This resolution consolidates previous plans into one Barton County NRP. Those who are currently receiving rebates from previous NRPs will not be affected, Prosser said.
“It’s a good program,” BCC Board Chair Mike Johnson said.
Personnel
In other business, the board approved the following new personnel:
• Paula Miller – Customer Service Representative (Fort Riley Campus)
• Kelley Scott – Academic Mentor (part-time) (Barton Campus)
• Stacy Dobratz – Admissions Representative (Barton Campus)
• Kathleen Stacey – Enrollment Services Support Specialist (Barton Campus)
