GREAT BARRINGTON -- The Berkshire Hills Regional School District will save $1.7 million in interest charges over the next decade after refinancing bonds used to fund the construction of the district's elementary and middle schools.
The district refinanced $16 million in bonds last month, but the potential savings for district towns won't likely be known until sometime later in December, according to Berkshire Hills Business Administrator Sharon Harrison. The savings will be shared with the Massachusetts School Building Authority, which subsidized the project.
"It reduces our debt obligation on average by $176,000 annually," Harrison said.
Berkshire Hills serves the towns of Great Barrington, Stockbridge and West Stockbridge.
The bonds were associated with a $29 million project that allowed for the construction in 2005 of Monument Valley Middle School and Muddy Brook Elementary School. The refinancing will save the district about 9.8 percent of the balance owed on the bonds.
The district's financial adviser was Eastern Bank and the bonds were refinanced by TD Securities.
The district's strong "AA" credit score contributed to the lower rate, Harrison said.
In September, credit rating agency Standard & Poor's provided a "stable" financial outlook for the district thanks to strong income and property value in the district. The credit agency also identified stable enrollment and financial performance, and strong credit quality from its three member towns. Harrison said the district also benefited from low borrowing rates.
The Massachusetts School Building authority subsidized the project by about 60 percent, so it will also share in the potential savings.
"We have to share that on a proportional basis equivalent to the reimbursement they gave us," Gregory said.
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