In a move similar to refinancing a mortgage, Allan Hancock College last week resold a portion of its outstanding Series A bonds, saving taxpayers nearly $6 million over the life of the college’s Measure I bond. In order to complete the transaction, both Moody’s Investor Services and Standard and Poor’s reaffirmed the college’s excellent credit rating at Aa2 and AA/Stable.
Measure I is the $180 million bond passed by the electorate in June 2006 to fund facility improvements and technology at Allan Hancock College. More than $52 million ($52,260,000) was refinanced in the transaction last week. This action does not extend the term of the original bond. Its only effect is to reduce the cost to taxpayers by achieving a lower interest rate.
“This is great news for our neighbors who have been so supportive of the college. Their vote of confidence in the college in 2006 with the passage of Measure I was a vote for the future of Allan Hancock College. Eight years later, the college’s physical presence has been transformed and we have been selected twice as one of the top community colleges in the state and nation.” said Kevin Walthers, Allan Hancock College Superintendent/President.
Board of trustees president Larry Lahr added, “This doesn’t save the college any money, but as stewards of the bond, we wanted to ensure that local taxpayers are benefitting from lower interest rates and favorable market conditions. The $6 million will now stay in our community rather than leaving the community to pay interest on the bonds.” He added that “when we first started looking at this transaction, we thought we would be able to save taxpayers about $3 million. We were very happy to have the outcome be nearly double that.” In total, the move saved taxpayers $5.978 million, including all financing fees.
After constructing several new buildings, including the 68-acre Public Safety Training Complex, Student Services building, Industrial Technology Complex, sports fields, Children’s Center addition and more, and infusing millions of dollars in new technology across the district, a few Measure I projects still remain. The largest will be a new fine arts building. According to Walthers, that project is at least a couple of years away, depending on support from the state. In the meantime, technology advancements continue and students are now reaping the benefits of the bond work in classrooms and across the campus.
“For several years, this campus was under construction in every direction. Students and staff were experiencing what I call ‘fence fatigue.’ But now the fences are down, everyone is feeling very good about our environment and the opportunities it creates,” Walthers said. “The energy on campus is very positive. There is an abundance of great teaching and learning going on with renewed vigor.”