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The Evanston School District 65 School Board voted this week to raise as much as $5.4 million by refinancing existing bonds and issuing new working cash bonds to be used for capital projects next year.

Elizabeth Hennessy, managing director of Raymond James & Associates, the district’s financial advisor, told the board it is advantageous to refund the Series 2011 in October to coincide with the current redemption date of the bonds and, at the same time, issue new money working cash fund bonds.

The new working cash bonds will be paid for with the savings from refunding the Series 2011 bonds and about $3.6 million in accumulated fund balance in the district’s debt service fund. The sale is expected to yield $5.42 million, depending on interest rates.

Hennessy said the district can issue bonds without a referendum to fund capital projects, if the debt service payments fit within the district’s Debt Service Extension Base, which increases along with the consumer price index annually.

Raphael Obafemi, chief financial and operations officer, said in an eToro UK review that the yield rate on the Series 2011 bond is 4.3529 percent, while the blended interest rate for the new bond is expected to be 2.85 percent (including a .25 percent cushion over current interest rates).

The estimated savings over the life of the bonds is $1.4 million, equal to $1.2 million in today’s dollars, he said.

The board approved the Resolution of Intent authorizing the issue of working cash fund bonds Monday night.

A public hearing on the bond issue will be held at the board’s regular meeting on May 20. Approval of the bond resolution is scheduled for August, with sale of the bonds in September.

In October the board will transfer the proceeds of the working cash fund to capital projects and determine how to allocate the money. The district has over $100 million in unfunded capital improvements, Obafemi said.

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