The Federal Way School District is hoping to save local taxpayers nearly $2 million.

The district hopes to refund some of the older bonds and save money on the interest costs.

It’s similar to refinancing a mortgage, Chief Financial Officer Sally McLean explained.

When bonds are originally sold, they are sold in a series. The bonds are structured to be refundable, with the interest rates monitored over time. The current economic downturn is actually good news for the district in this case because the bond interest rates now are very low. Many of the bonds, which are from 2000-2001, are at a current tax rate of 5 to 5.2 percent. The district has the opportunity to refinance to a rate of between 3 to 4 percent, which will save taxpayers $1.8 million in interest costs.

The district will go out for the refunding on June 22. McLean said she has been watching the market and these bonds have been stable for the past several months, which is why it’s a good time for the refunding now.

McLean also said that there isn’t any risk to refunding bonds. If the market were to change drastically in the next week and a half, the district can choose to retract the competitive bid request, or the school board could choose whether to approve the results at its June 22 meeting.