Royal Oak Schools Plan Sale of 2014 Refunding Bonds

The Board of Education of Royal Oak Schools has announced the successful sale of its 2014 Refunding Bonds in the amount of $39,075,000.

The Bonds are being issued for the purpose of refunding the school dstrict’s outstanding 2005 school building and site bonds and to pay the costs of issuing the bonds. The 2014 refunding bonds reduce the school district‘s interest expense approximately $3,967,135 for the taxpayers and will occur through lower debt payments over the next seven years.

In preparing to sell the 2014 Refunding Bonds, the school district, working with their financial advisor, Stauder, Barch & Associates, Inc., requested that Moody’s Investors Service evaluate the district’s credit quality. Moody’s assigned the school district the underlying rating of “Aa2”. The rating agency cited the school district’s maintenance of healthy reserves, manageable debt burden and large tax base in their rational for rating the School District at this level.

“Our finance team has worked diligently on this refunding,” said Shawn Lewis-Lakin, Superintendent of Schools for Royal Oak Schools. “When the citizens approved the 2005 Bond proposal they made a commitment to our children and their learning. Through this refunding of the 2005 bonds, which reduces debt liability moving forward, we honor that commitment.”

The district’s financing was conducted by the Michigan investment banking office of the brokerage firm, Stifel, the financial advising firm, Stauder, Barch & Associates, Inc. and the law firm serving as bond counsel, Miller, Canfield, Paddock and Stone, P.L.C. The School District’s 2014 Refunding Bonds were sold at a true interest rate of 1.44% with a final maturity of 2021 (a repayment term of approximately seven years).

“Royal Oak Schools’ Bonds were well received by the bond market.” said Brenda Voutyras, Stifel’s managing director. “We saw high demand and were able to take advantage of current low interest rates that resulted in a savings level that exceeded the goals of the District.”

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