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ORCHARD VIEW SCHOOLS

December 4, 2015 — Superintendent Jim Nielsen and The Orchard View Board of Education are proud to announce the successful sale of its 2015 Refunding Bonds, Series A in the amount of $3,400,000 and 2015 Refunding Bonds, Series B in the amount of $12,180,000.  The 2015 Refunding Bonds, Series A are being issued for the purpose of refunding a portion of the School District’s outstanding 2003 Refunding Bonds and paying a portion of the costs of issuing the Bonds.  The 2015 Refunding Bonds, Series A reduces the School District’s interest expense by approximately $1,146,000 for the taxpayers and will occur through lower debt payments and interest avoidance over the next 11 years.

 

The 2015 Refunding Bonds, Series B Bonds are being issued for the purpose of refunding certain outstanding indebtness of the School District to the State of Michigan under the State of Michigan School Bond Qualification and Loan Program and to pay a portion of the costs of issuing the Bonds.   The Series B Bonds reduce the repayments to the State of Michigan by a total estimated amount of $1,235,000.  The estimated reduction in repayments is based upon the current School Bond Loan Fund interest rate of 3.50%.  Collectively, the Series A and Series B Bonds will save the School District an estimated $2,381,000.

 

In preparing to sell the 2015 Refunding Bonds, Series A and 2015 Refunding Bonds, Series B, the School District, working with their financial advisor, Public Financial Management, Inc., requested that Standard & Poor’s Ratings Services (“S&P”) evaluated the School District’s credit quality.  Moody’s assigned the School District the underlying rating of “BBB+”.  The rating agency cited the School District’s participation in the Muskegon area economy and good employment base as well as good general fund balance as a percentage of expenditures.

 

The School District’s financing was conducted by the Michigan investment banking office of the brokerage firm, Stifel, the financial advising firm, Public Financial Management, Inc. and the law firm serving as bond counsel, Thrun Law Firm, P.C.  The School District’s 2015 Refunding Bonds, Series A were sold at a true interest rate of 2.99% with a final maturity of 2026 (a repayment term of approximately 11 years) and the 2015 Refunding Bonds, Series B were sold at a net federally taxable interest rate of 2.36% with a final maturity of 2021 (a repayment term of approximately 6 years).

 

Kim Bidwell, Director of Buisness states, “Orchard View Schools Bonds were well received by the bond market.  We saw good demand for the issue and were able to take advantage of current low interest rates that resulted in a very nice savings for the District and its taxpayers.”

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