OceansideOceanside — Oceanside Unified School District has restructured $42.9 million in bond debt, a shift expected to save the school district more than $82 million in interest payments over the 40-year life of the high-interest bonds, a school district official said.
With the restructuring completed, Oceanside Unified is planning to sell new bonds in January to fund the construction of the $17.7 million performing arts center at Oceanside High School, and pursue about $9 million in modernization projects at Jefferson Middle School in preparation for converting the campus to a kindergarten-through-sixth-grade feeder school for a planned performing arts charter school. The charter school, the Orange County School of the Arts, would serve grades seven through 12.
The debt restructuring also will permit the school district to start design work for other priority projects, including renovating Ivey Ranch and Garrison elementary schools.
“We’re super-excited. We’re saving taxpayer dollars,” said Chris Wright, assistant superintendent in charge of business services with Oceanside Unified.
Wright said that the restructuring gives the school district about $100 million in untapped funds from the 2008 bond, known as Proposition H.
Oceanside Unified will continue to have about $684 million in total debt, all of which must be paid back by 2051. The difference between the $205 million in bonds issued to date and the $684 million in total debt is the interest that Oceanside would pay back if it held all of the bonds over their full maturation period.
Oceanside Unified officials previously reported that about $95 million of its $205 million in bonds were capital appreciation bonds, or CABs. These are the same type of bond that put the Poway Unified School District in the national spotlight and led to state legislation in 2013 that places stricter limits on what kind of bond sales school and community college districts can engage in.
CABs allow borrowing agencies to defer repayment for up to 40 years. Interest compounds during the long maturation periods, leading agencies to pay back far more in later years.
