Belle Vernon Area School District is expected to save almost $330,000 because of the school board's decision Tuesday to refinance the district's 1998 bond issue.
The savings will come during the course of three years, according to Joseph Muscatello, of J.P. Morgan, who is handling the refinancing.
Muscatello told the six school board directors present at a 10-minute meeting conducted yesterday that the savings will begin May 8, when the refinancing deal is closed. At that time, the district will receive a check for roughly $150,000.
The remaining savings will be realized through reduced debt payments in the next three years.
The amount to be saved is not as large as was expected initially. Several weeks ago, when board President Aaron Bialon mentioned the refinancing opportunity, he said he was told there would be almost $650,000 in savings.
Then came war in Iraq, a factor Muscatello said has caused bond interest rates to fluctuate.
"It seems like this market is driven by emotion on how the war goes," he said.
The school board approved the refinancing deal with a 6-0 vote.
Directors Harve Anderson, Dr. L. Douglas Pepper and Frank Muccino were not in attendance.
The money saved, by law, can't be used in the general operating fund. Instead, it must be reserved for capital projects.
Ken Luttinger, the district's bond counsel, said the refinancing will not alter the bond's repayment schedule.
