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County refinances debt to save $1.6 million

 

SARAH LOWERY

Staff Writer

 

After successful refinancing efforts last month, County Manager George Wood’s office announced that another bond issuance conducted Tuesday will save the county more than $1.6 million over the 12-year life of the bonds.

According to the news release, the county refinanced $17.2 million of its 2005 Series General Obligation Bonds, with the net present value of the total savings at more than $1.5 million.

When the Times-News spoke with Wood in January, he said the “highly unusual” bond market was providing an excellent opportunity for the county to refinance some of its existing debt and save taxpayer dollars.

He also said the county’s financial advisors had recommended taking advantage of the current market environment and encouraged the finalizing of Tuesday’s sale. At the time, Wood compared the process to redoing a mortgage to attain a lower interest rate.

Lincoln County officials have been refinancing the county’s debt over the last three years as more favorable interest rates, the lowest Wood has seen throughout his career, have made it financially feasible to do so. To date, this has resulted in savings to taxpayers of more than $4.8 million over the life of the refinancing bond issues, the release noted.

As for the immediate impact on the county’s budget from Tuesday’s sale, there will be a decrease in debt-service payments of nearly $138,000 in fiscal year 2013. Additionally, savings in each of the following 11 years are expected to be roughly the same.

“We are delighted with the results of this bond refinancing,” Wood stated in the release. “We had anticipated savings of about $1.2 million as we planned this refinancing, so the favorable bids today exceeded our expectations by a wide margin.”

“We had 13 bidders participating in this process,” he continued. “I want to particularly thank former Finance Director Leon Harmon and our financial advisors, First Tryon Advisors, for their excellent work on this issuance.”

County commissioners previously authorized the bond refinancing.

 

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