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Forsyth Schools to save $7 million in bond payments

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FORSYTH COUNTY, Ga. — The Forsyth County Board of Education voted unanimously Nov. 16 to refinance a portion of its 2013 and 2014 bond debt, a move that will save the district approximately $7.17 million over the remaining 12-year life of the payments.

Chief Financial Officer Larry Hammel said the move is like refinancing a house to reduce the interest rate paid over the lifetime of a loan. This means, he said, that Forsyth County Schools won’t have to collect as much money and may even begin to roll back the millage rate starting in 2024.

The original 2013 bond was also a refinancing for $134.715 million over 11.5 years. The original voter-approved 2014 bond was for $94.71 million over 19.5 years. The school board has already paid off a little over $129.35 million of those initial bonds.

Hammel said that because interest rates are nearly at historic 30-year lows and with the district’s AAA credit ratings from Moody’s and S&P, it was able to lock in very low rates to refinance the callable maturities of its 2013 and 2014 bonds totaling $100,075,000.

FY22 budget for Forsyth County Schools increases despite COVID-19

In the past, Hammel said, the district used both education Special Purpose Local Option Sales Tax, or e-SPLOST, funds and bond issues to build new schools. However, the demand for more schools has slowed down, in part, due to the COVID-19 pandemic.

Hammel said he doesn’t see a need to build another school for probably another five years or until the beginning of SPLOST VII. The last school currently being built is New Hope Elementary School, which is set to open August 2022.

“What we’ve been able to do now is stop issuing debt,” Hammel said. “Our debt is at about $518 million as of this year, and the goal is – based on how our payments are scheduled – we’ll have 66% or 60% of that paid off in the next 10 years. So, our bond debt is being paid at an incredible rate, and all of it will be paid off by 2038.”

Reach Chamian Cruz at 770-847-8079. Follow her on Twitter @xchamian.

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