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*The board approved refinancing $10 million in long-term debt. The district currently has about $15 million in debt, of which $12 million could be refinanced. Due to legal requirements, the district can only refinance $10 million in debt per year, so the district refinanced a little over $2 million in December 2003 and now finished refinancing the remaining $10 million.

The primary object of the refinancing was to lower the annual payment schedule for the district. Currently, the district pays about $1.9 million per year in debt payments. With the refinancing, their debt payments will be reduced to $1.08 million per year.

The district received an interest rate of 4.75 percent for the first $2 million of refinanced debt and 5.0 percent for the $10 million approved last week. The debt was refinanced over 20 years, with the interest rates locked in for the first seven years. Their old interest rates ranged for five to seven percent on the debt.

The lead lendor in the refinancing was Community First National Bank, which assumed $5 million of the debt. The rest of the bonds were sold to other banks.

The district did agree to restrictions in its capital spending to complete the deal. Since the district is highly leveraged, they cannot make a purchase of over $100,000 without approval from CFNB until they meet some financial performance figures. Once they do, their spending limit increases to $500,000 and then to $2 million if their financial situation continues to improve.

The board unanimously approved the refinancing, with board member Don Anderson abstaining because he has an interest in a bank that is involved.