November 18, 2015 -- Local property owners will see taxes drop by a combined total of more than $4.2 million after the Santa Monica-Malibu School District refinanced bonds for Measure BB approved by voters in 2006, District officials announced Tuesday.

With interest rates at a historical low, the district replaced bonds that had an average interest rate of approximately 4.73 percent with new bonds at an all-inclusive interest rate of 3.05 percent, officials said.

“All of the savings from the refinancing will be passed back to District taxpayers in the form of lower property tax bills,” District officials said.

The refinancing did not extend the term of the original bond payments, officials added.

“Our community has supported us time and again,” said Jan Maez, the District's chief financial officer. “We owe it to our taxpayers to lower the burden whenever possible.”

The lower interest rate is due to the District's Aa1 bond rating from Moody's Investors Service and a AA rating from Standard & Poor’s Ratings Services, which helped to “secure strong investor demand,” officials said.

“When market conditions allowed us to significantly lower the interest rate, our Board of Education did not hesitate to pursue the opportunity,” Maez said.

The refinancing comes nearly three years after the District completed a similar bond refinancing in February 2013 that saved taxpayers $2.8 million through 2032, officials said.

“With this recently-completed refinancing, total savings to taxpayers since 2013 exceed $7.1 million,” officials said.

Measure BB has funded safety and security upgrades, repair and renovation to all school sites in the district, as well as some computer and technology upgrades, District officials said.

Unlike other facility funding measures which need more than two-thirds of the vote, Measure BB needed only 55 percent of the vote to pass. It won with 67 percent of the vote.

The approved bond translated to $30 per $100,000 assessed value on Santa Monica’s citizen’s property tax bills, or $150 for a half-million dollar house.

In November 2012, local voters approved Measure ES, which gave District officials the go-ahead to borrow another $358 million to be used solely for building school facilities and infrastructure improvements.

The measure, which required two-thirds of the vote, won with 68 percent.
In February, the School Board voted to spend $180 million of ES money for capital projects at Santa Monica High School, where officials said facilities were badly in need of upgrading.

Some of the ES money also was expected to cover projects funded through Measure BB, which had an estimated $30 million shortfall on projects, officials said in February.