Taking advantage of low current interest rates and the district’s strong financial reputation, Big Lake Schools made the proactive move to refinance existing voter-approved building bonds issued in 2016. This is a major financial win for local property owners, saving district taxpayers $1.18 million over the building bond’s lifetime.

During a competitive sale on August 26, seven financial institutions submitted bids for the district's Series 2026A bonds. Zions Bank delivered the winning bid, securing a remarkably low True Interest Cost of 2.82%, down from the presale estimate of 3.61%.

Big Lake Schools was able to secure this new low rate largely because of the district’s strong reputation for responsible fiscal management. Prior to the sale, Moody's Ratings reaffirmed Big Lake Schools' elite "Aa3" underlying credit rating, which ranks as the fourth highest on a 21-point scale. In public finance, this rating serves as an independent, third-party verification of the district's strong budget oversight, disciplined financial management, and long-term stability.

"Securing this low rate is proof of our ongoing commitment to stretch every local tax dollar as far as possible," said School Board Treasurer Amber Sixberry. "Just like a homeowner refinancing a mortgage to lock in lower monthly payments, this move directly cuts our future interest costs by $1,186,000, ensuring our community pays no more than necessary for school facility debt."

Under Minnesota law, school funding is strictly divided into separate accounts. Bond proceeds and interest savings are legally restricted to facility construction, repairs, and debt payments, meaning they cannot be transferred to fund day-to-day classroom expenses, staff salaries, or utility bills.

Even as daily operational inflation across Minnesota continues to outpace state education funding, Big Lake Schools remains dedicated to capturing every possible efficiency across all budget areas. Maximizing savings on facility debt is one more way the district practices smart, transparent stewardship on behalf of local taxpayers.

FAQ 

Q: How long is this new refinance term? What was the old term?

Under the original agreement, we would have had seven years left of the term. Now, we will have the bond paid off in three years.

Q: Is the difference in payment going to bring down our taxes? Or is the difference being put towards the principal of the loan to pay it off quicker? 

Both. Between locking in a lower rate and paying off the loan sooner (and thus eliminating four years of interest), district taxpayers will save $1,186,057 over fiscal years 2027-2033.

Q: Does this free up funding for classroom needs? Is this related to the outcome of the November 2026 referendum?

No. This savings is specifically tied to the bond referendum that was passed in 2016 and these funds legally cannot support other needs related to day-to-day classroom expenses, staff salaries, utility bills, etc.

While refinancing saves taxpayers money in the long-term, it does not provide any extra funding for the district to support other needs. We decided to refinance because market rates have dropped and we were able to get a lower rate (like refinancing a house). We would have done the same thing regardless of the results of the most recent election.

Q: Interest rates were at their lowest six years ago. Why didn’t you refinance then?

There are Minnesota Statutes that govern when a school district can refinance bonds. The 2016 bonds were not eligible for refinancing at that time.