Brainerd School District residents will pay less money on their 2003 school property taxes than expected.
The Brainerd School Board sold the $59.9 million in general obligation bonds Wednesday to U.S. Bancorp Piper Jaffray at an interest rate of 4.9102 percent.
The bonds were AAA rated. Steve Dickinson, district business manager, said the district received this rating because of community support, the area's economic strengths and its growth. With this rating, if the district is unable to make a bond payment the state will make the payment.
The district had seven bids for the sale of the bonds that ranged from 4.9102 to 4.971 percent.
Joel Sutter and Kristin Hanson of Ehlers and Associates financial advisers projected a 5.4 percent interest rate for the 20-year bond before the $59.9 million bond referendum passed in March.
The savings of less than a half percent will save the district $3.3 million in interest over the life of the bond. With the 4.9102 percent rate, the $59.9 million bond will accumulate about $45.94 million in interest for the 20-year period, compared to an estimated $49.26 million in interest. This pushes the district's debt levy for the bond to $109 million.
The school district's total debt levy over the 20-year period is projected to be $134 million. This levy includes health and safety projects and the $1.9 million in existing debt that is expected to be paid off by 2015. The net levy is estimated to be $182 million by 2027.
The estimated net change in taxes from 2002 to 2003 will be $48 more compared to the projected $52 more for a homeowner with a $100,000 market value home; $72 more or $5 less than projected for a homeowner with a $150,000 market value home; and $97 more compared with the projected $103 more for a homeowner with a $200,000 market value home.
The increase for a commercial/industrial property owner will be $72 for a $100,000 commercial market value; $157 for a $200,000 commercial market value; and $445 for a $500,000 commercial market value.
A seasonal and recreational homeowner will pay $24 more a year with a $50,000 market value; $48 more with a $100,000 market value; and $97 more for a $200,000 market value.
The money from the bonds will be available to the district June 5. The district's first interest payment is due Feb. 2. The payment is for $1.97 million and $250,000 of that will come from the debt service fund.
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