The Montgomery ISD Board of Trustees has authorized the defeasance and refunding of existing district bond debt resulting in $10.44 million in savings to Montgomery ISD taxpayers.
As a result of these actions taken by the Board, the district has refinanced select bonds authorized by voters in 2015 with a 5% interest rate to a 4% rate. With this refinancing, the term of these bonds was decreased by one year. The decreased rate and term resulted in significant savings to taxpayers.
Seeing the rise in current interest rates and the projection that rates may increase an additional 2.5% through 2023, district leadership has been actively seeking to pay off bonds early and reduce the district’s existing debt obligations.
“One of our top priorities as a school board and district leadership team is to be responsible stewards of taxpayer dollars,” Board President Matt Fuller said. “The diligence of our superintendent and leadership team to continually seek opportunities that will benefit our community, taxpayers and district financial standing are actions I will always support, and I am proud of their efforts to think innovatively about our budget and fully support their efforts to save taxpayers’ money.”
Montgomery ISD’s proactive enhancement of its financial standing may serve as a protective measure to address future interest rate increases. Additionally, these actions also create additional capacity that would minimize the tax impact of any future issuances of bonds needed to address rapid growth being experienced throughout Montgomery.
Montgomery ISD’s current total tax rate is $1.26 per $100 of assessed property value. This is the district’s lowest overall tax rate since 2005.