By Janine DavisRecord Staff WriterA bond refinancing will save the Warren County R-III School District about $250,000 more than what was originally estimated.The school board voted, at the Feb. 12 meeting, to adopt a resolution finalizing the sale of $10 million in general obligation refunding bonds. The average interest rate will be set at 2.06 percent, compared to the Series 2006 bonds which carry an average rate of 4.75 percent.The refinancing reduces future interest expense by $1,750,837.“Last month, we were here and estimated the refunding savings would be about $1,490,000,” said Tom Pisarkiewicz, vice president of the district’s municipal bond underwriter L. J. Hart & Company of St. Louis. “You’d given us the green light to proceed, but tonight we’ll one-up that estimate. We have investors lined up to lock in interest rates with a net savings of $1,750,837. So that’s just over a $259,900 increase in savings from a month ago.“We look at the 10-year U.S. Treasury as a benchmark, and at that time, it was right around 1.9 percent, and just recently it came down to just under 1.7 percent, and it’s actually starting to work its way back up,” Pisarkiewicz said. “I’m not saying we caught it at the optimal time, but it looks like it.”Pisarkiewicz reported that the savings of $1,750,837 plus the approximate savings of $4,549,537 from eight other refundings and three prepayments since 1995 mean that the district has saved about $6,300,374 in interest expense.The Series 2015 bonds have a call feature on March 1, 2018, at no penalty, so if interest rates are lower in 2018 or later, R-III can take advantage of that.“We certainly can’t predict the market; the only thing we can do is give you flexibility for short-call features to capture those lower interest rates,” Pisarkiewicz said.“This plan achieves good savings, and provides an opportunity for our district to be in a better situation to present no tax increase building proposals with voter approval in the near future,” noted R-III Superintendent Dr. Jim Chandler.Three significant factors making the Series 2015 refunding possible, Pisarkiewicz said, were interest rates 2.50 percent lower than in 2006, the fact that the Series 2006 bonds are subject to prepayment on March 1, 2016, at no penalty, and the district’s ability to participate in Missouri’s Direct Deposit Program, which makes it possible for R-III to receive an “AA+” rating from Standard & Poor’s Rating Services.The proceeds from the Series 2015 refunding bonds will be placed in an escrow account with UMB Bank, N.A. (Kansas City) and reinvested in U.S. Treasury Securities. The earnings from this escrow account meet the interest payments on the Series 2015 Bonds through March 1, 2016, and then produce the $10 million necessary to prepay the Series 2006 bonds on that date.“That’s when you’re going to start recognizing the savings,” said Pisarkiewicz. “It’s going to be around $275,000 a year.”The Series 2015 bonds were underwritten by L.J. Hart & Company and offered to local financial institutions. FMB Bank purchased $250,000; First State Community Bank obtained $250,000; and Missouri Bank acquired $400,000 to show their support for the district.“It’s great to see that local support,” said Chandler.R-III district sees extra savings in bond refinancing