NIAGARA FALLS - The city School Board expects to save local taxpayers about $100,000 a year in interest costs by refinancing more than $6 million in loans that it borrowed to pay for school construction and repair projects that were finished years ago.

The nine-member School Board voted unanimously Monday to refinance its borrowing through the state Dormitory Authority to take advantage of current lower interest rates.

School Business Administrator Timothy Hyland said the district has been paying 5 percent annual interest on money that it borrowed for capital improvements in the 1990s and early 2000s. He said refinancing could reduce that rate to perhaps 2.5 percent to 2.8 percent.

Hyland said some of the borrowing will be paid off in the next couple of years, but other parts won't be paid off until 2022.

He explained that the school district still will have to make annual payments until the principal debt is paid in full. Monday's action affects only the amount of interest on the loans; it does not reduce the amount of the original borrowing that must be paid back.

School Superintendent Cynthia A. Bianco said the reduced interest rate "could mean thousands of dollars to us. It is a rare opportunity to cut expenses."

She emphasized, however, that Monday's action on the old borrowing "has absolutely no relation to the bond resolution that is coming up for a vote next week."

City residents will vote next Tuesday on a referendum to borrow about $67 million for a project called "Inventing Tomorrow."

If approved by the voters, that borrowing will pay for reconstruction or repairs at each of the city's school buildings; increased security; compliance with the Americans With Disabilities Act to make all facilities accessible to the handicapped; increased energy efficiency; the installation of high-tech science laboratories; and the upgrading of sports fields with artificial turf.

The money for "Inventing Tomorrow" will be borrowed separately and will not be part of the refinancing arrangement approved Monday.

Members of the School Board and its administration insist that the "Inventing Tomorrow" investment will be paid for entirely with money supplied by the state government and that it will not add a penny in local property taxes in Niagara Falls.

Most of the state money will come in the form of financial aid for buildings. The rest will come from Greenway funds provided by the New York Power Authority as part of its relicensing agreement for the Niagara Power Project.

Voting on the "Inventing Tomorrow" referendum will be held from noon to 9 p.m. Tuesday in each of the regular polling places in Niagara Falls.

Hyland said the School Board authorized the refinancing of up to $6.9 million in its action Monday, but "the amount actually expected to be refinanced will be about $6.3 million."

He said the additional $600,000 was included in the refinancing resolution to cover any unexpected costs that may arise in connection with the transaction. "We will use only the amount that is necessary," he said.

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