As interest rates fluctuate, it can be beneficial to refund (refinance) bonds to attain a lower rate. Much like refinancing your own home, refinancing General Obligation (G.O.) Bonds may reduce required interest paid over the life of the bond.
In 2006, the Elmhurst Park District issued General Obligation Limited Tax Park (G.O.) Bonds to fund the redevelopment of East End Pool, renovation of Wilder Mansion, and to partially fund the installation of synthetic turf athletic fields at Berens Park. The district makes annual payments on these bonds from property tax revenues.
On February 26, 2014, the Park Board of Commissioners approved an ordinance which authorized the district to refund (refinance) existing bonds. On April 8, 2014, the district closed on the refunding of the 2006 G.O. Bonds, saving Elmhurst taxpayers $204,528 during the remaining twelve-year life of the reissued bonds.
About General Obligation Bonding Authority
Park Districts in the State of Illinois have General Obligation Bonding authority. Pursuant to Illinois State Statutes, Article 6: General Indebtedness, the Park District has the authority to sell G.O. bonds for the purpose of providing "for the payment of land condemned or purchased for parks or boulevards, for the building, maintaining, improving and protecting of the same and for the payment of the expenses incident thereto..." and providing for the levy of a direct annual tax to pay the principal and interest on said bonds. Further, Park District Code Article 6 allows the Board to "sell such bonds in any manner it deems for the best interests of the district..." This bonding authority provides the District the ability to use long-term debt instruments and operating surpluses to finance large capital projects and repay outstanding debt rather than relying on funds that are needed to meet operating expenses.