LANCASTER — Antelope Valley taxpayers will see lower property taxes, after Antelope Valley College trustees unanimously agreed to refinance about $66.9 million in Measure AV bonds.
Measure A is the $350 million bond measure passed by local voters in November 2016. Proceeds from it are paying for numerous construction projects on the Lancaster campus, including the new Sage Hall and Discovery Lab buildings and the Marauder Complex at Marauder Stadium.
Frank Vega, managing director of RBC Capital Markets, said this will be the first time the college has been able to refinance Measure AV bonds.
AV College can reduce the amount owed on bonds through a refunding process that will reduce the current interest rate from 5.02% to 2.42%, for an estimated preliminary savings of $12.3 million with no extension of term.
“That also has a direct benefit to the college, because while lowering those taxes provides a relief to the taxpayer, it also creates flexibility for the balance of Measure AV,” Vega said during a presentation at the July 12 Board meeting.
Measure AV has approximately $105 million remaining of authorized but unsold bonds. The bond refinancing will provide the college the opportunity to set up the unsold bonds in the most cost effective way for taxpayers, he said.
AV College’s 2020-21 assessed value is about $39.4 billion, a 5.83% increase from the previous year. The college’s bonding capacity is $607.43 million, of which there are $378.8 million total bonds outstanding.
“You’ve managed your debt very well,” Vega said.
He later noted that AV College has a very high credit rating that allows them to lock in the low interest rate.
The college saved taxpayers an estimated $40.5 million since April 2014 by refinancing bonds under Measure R, a 2004 bond measure that provided AV College with $139 million for renovation and expansion of the Lancaster campus.