Centennial Saves $4.13M By Refinancing School Bond

WARMINSTER, PA —The Centennial School District has refinanced a school bond, leading to a $4.132 million savings, school officials said.

After receiving an Aa2 general obligation bond limited tax (GOLT) rating from Moody's Investors Service, the school district has completed the refinancing of outstanding general obligation bonds, resulting in a $4.132 million savings for taxpayers in Warminster and Upper Southampton townships, the communities served by Centennial.

The Aa2 rating reflects the district’s strong financial metrics, including an available restricted and unrestricted fund balance ratio equivalent to 18.7 percent of total revenue at the end of fiscal year 2023- that will strengthen over the next two fiscal years due largely to conservative budgeting for revenue and expense management. Moody’s indicated a fund balance below 15 percent could lead to a ratings downgrade, Schools Superintendent Dana T. Bedden said.

By taking advantage of favorable interest rates and their strong financial status, the school district was able to refinance existing debt at a lower rate, reducing annual debt service payments by over $300,000 per year.

"We are pleased to deliver this significant cost savings to our community," Bedden said. "This refinancing demonstrates our ongoing commitment to fiscal responsibility and providing the best value for taxpayer dollars."

The bond refinancing was completed with the support of the district’s chief financial officer Tom
Greenwood, and the district's financial advisors. It was approved by the Warminster Township Board of Education.

The savings will be realized over the remaining life of the bonds, school officials said.

"Refinancing debt at lower interest rates is an important tool that allows us to redirect resources to support our students and schools," Greenwood said. "This is a great outcome for our community."