San Diego Community College District refinancing to save taxpayers $27.2 million

The San Diego Community College District recently refinanced two outstanding bonds, which will save taxpayers about $27.2 million over the life of the bonds.

The savings represent 6.25% of the refunded bonds.

The transaction refinanced about $353 million in outstanding bonds and lowered borrowing costs without reducing funding for construction, modernization or other capital improvements approved by San Diego voters.

The bonds financed projects under Proposition S and Proposition N, which funded the construction and modernization of classrooms, laboratories and other facilities at San Diego City College, San Diego Mesa College, San Diego Miramar College and the San Diego College of Continuing Education.

"San Diego voters placed their trust in the district when they approved Proposition N and Proposition S to improve educational facilities throughout our colleges," San Diego Community College District (SDCCD) Chancellor Gregory Smith said in a statement. "By refinancing this debt at more favorable terms, we are reducing the long-term cost to taxpayers while continuing to deliver the high-quality learning environments our students and communities expect."

Daniel Troy, vice chancellor of finance and business services, said refinancing bonds when market conditions are favorable is a standard financial management strategy that can reduce repayment costs while preserving investments in public facilities.

The district monitors the municipal bond market for opportunities to lower borrowing costs, Troy said.

"By acting strategically, we generated more than $27 million in savings for taxpayers without affecting the scope or schedule of any bond-funded projects," he said.

Including the latest refinancing, SDCCD said it has generated more than $366 million in taxpayer savings through bond refundings associated with the Proposition S and Proposition N programs. The figure combines about $339.1 million in savings reported following a 2024 refinancing with the latest $27.2 million in savings.

The district also plans to monitor financial markets for opportunities to refinance debt associated with Measure HH, the $3.5 billion facilities bond approved by San Diego County voters in November 2024.

Measure HH is funding facilities improvements as projects move forward across SDCCD's colleges and education centers. District officials said they will continue to look for opportunities to reduce borrowing costs and taxpayer debt without affecting approved projects.