This study examined advanced refundings of Indiana school construction bonds from 1993 to 1996. Purposes were to: (a) add to the professional knowledge base about advanced refundings; (b) evaluate the financial consequences on taxpayers; (c) determine benefits as measured by interest rates, terms, and payment amounts; (d) determine whether selected financial conditions and demographic variables impacted refunding outcomes.The population was all instances of advanced refundings by Indiana public school districts in the period studied. Data were collected from the bond transcripts prepared by legal counsels and placed in tabulation forms developed for the project.Primary findings included:(a) Three quarters of the refunding occurred in the first 10 years of the paymentstream; 27% occurred in the first four years.(b) As the size of the issue increased, the cost (as a percentage of the issue)decreased.(c) Mean decrease in interest rate for the refizndings was .023915 or 239 basis points.(d) Net fiscal impact was generally positive, with a mean savings of $224,218. (e) A negative correlation existed between district wealth and annual paymentamount (i.e., districts with high assessed valuations had smaller changes inannual payments).(f) A positive correlation existed between interest rate change and refunding amount (i.e., large issues were more sensitive to slight changes in interest rates).Selected conclusions included:(a) The benefits of refunding diminished with time (i.e., greatest benefits are likely in the first quarter of the payment stream).(b) Some refundings occurred when the decline in basis points was below a standard level used for municipal bonds; this suggests that school officials may engage in refundings for reasons that extend beyond savings (e.g., political benefits).(c) An economy of scale between refunding size and costs supports existing research.(d) Costs for local school district counsel varied considerably, suggesting that no compensation standard was used.(e) Wealthier districts were less interested in lowering annual payments; their pursuit of refunding may have been motivated by flexibility (i.e., shortening the debt life, accessing fiscal resources).(f) Districts with large bond issues benefited from refunding even when the declines in interest rates were slight.Eight recommendations were formalized. / Department of Educational Leadership