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The West Salem School District will save taxpayers over $222,000 after it refinanced bonds taken out for the elementary school referendum.

The school board approved the refinancing — the second time for the bonds — at its meeting on May 27. The total amount saved is $222,280, or about $37,000 a year for the next six years of the life of the bonds.

“We’re always looking at ways to reduce the tax burden to taxpayers,” said Superintendent Nancy Burns. “That’s the board’s responsibility.”

The board refinanced $3.86 million in bonds from the $8.2 million referendum voters approved in 1994 to construct a new elementary school. Originally, the district was to save $169,000 with the refinancing, but, late last week, Burns said it was discovered the district could save an additional $53,000 by making earlier payments on the bonds.

This is the second time the school district has refinanced the elementary school bonds. In 1998, a refinancing saved $467,460, bringing the total savings to $689,740.

Burns said refinancing the bonds has been possible due to favorable and lower interest rates. Bonds are only callable at certain periods during the referendum financing, and this is the last time the district can refinance the remaining bonds, which runs through 2014.

“It’s kind of like refinancing a house,” Burns said. “You do that when interest rates are lower.”

When the referendum was passed, the initial interest rate was 6.9 percent. The refinancing in 1998 put the rate at 4.5 percent, and Burns said the rate this time should be about 3 percent.

High school Principal Troy Gunderson said taxpayers should be pleased with the savings.

“When we first got that 6.9 percent, we thought that was pretty good at the time, and now look where we are,” he said. “I think people ought to know this. The fact is it was to cost you this much but it’s considerably less because we’ve refinanced this two times.”

This is also the second time in the last two years the district has refinanced referendum bonds. In the fall of 2006, when Burns started, the board refinanced bonds taken out for the high school project, saving about $40,000 a year through 2021.

Taxpayers won’t necessarily see a direct savings due to the refinancing of bonds, but Burns noted the money saved is less money the district would have to budget for in future years, thereby easing the tax burden on taxpayers.

Baird is handling the refinancing of the elementary referendum bonds, and it will cost the district about $30,000 for fees and costs of issuance.

“I think that’s a pretty good deal — $30,000 for $222,000,” Burns said.