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By LeAnn R. Ralph
ELK MOUND — The Elk Mound school district will save $2.9 million on the first round of referendum borrowing in the amount of $9.6 million.
Brian Brewer, director of Baird Public Finance, provided an update on the referendum financing at the Elk Mound Board of Education’s July 20 meeting.
Considerable cost savings in interest could be realized by borrowing the money in increments of less than $10 million with a bank qualified loan, said Eric Wright, district administrator.
The initial interest rate was estimated at 4 percent, but the actual interest rate on borrowing $9.6 million will be 2.11 percent, he said.
The estimated cost to the taxpayers on the entire $15.7 million was $78 per $100,000 of property value, Wright said.
The tax impact at 2.11 percent interest on the $9.6 million will be $44 per $100,000 of property value, he said.
The savings to the school district between an interest rate of 4 percent and an interest rate of 2.11 percent interest is $2.9 million, Wright said.
Another way of describing it is that the school district will avoid paying an additional $2.9 million in interest based on the initial estimated interest rate, he said.
The school district plans to borrow the remaining $6 million in April of 2021 and hopes to borrow the additional money as a qualified bank loan as well, Wright said.
Voters in the Elk Mound school district approved the nearly $16 million referendum question during the April 7 election on a ratio of two-to-one.
Referendum projects will include safety and security updates at all three schools; updates to the woodworking and metal shops; building systems that will include roofs and boilers at all three schools as well as Heating, Ventilation and Air Conditioning (HVAC) updates; library improvements; a high school band room; a new middle school gymnasium; remodeling the existing middle school gymnasium into a classroom; updating the high school locker rooms; athletic field improvements; and extending the high school weight room.