Dane County Executive Kathleen Falk announced Friday that two multi-million dollar bonds would be refinanced in order to take advantage of current low interest rates.
With all areas of the government looking to cut spending, this will help the county maintain its budget.
“We’ve already budgeted for the cost of repaying the airport and the courthouse, so these are savings that will help the bottom line,” Joshua Wescott, spokesperson for Falk, said.
By refinancing these two bonds, the county stands to save about $460,000 annually over several years, according to a press release issued by Falk’s office.
“By taking advantage of lower interest rates, we’ll save taxpayers about $3.4 million,” Falk said in the release.
Both bonds were issued in 2002 to fund major city projects. The first was a $13 million bond that helped fund a new airplane terminal at the Dane County Airport. The second was a $20 million bond that helped fund a new courthouse downtown.
Due to the terms and conditions of the bonds, both are eligible to be refinanced for the first time without receiving any pre-payment penalties.
According to the release, the current state of the market makes this an opportune time for refinancing these bonds. Interest rates are much lower now than they were in 2002. As a result, the county is in a position to save money by paying less interest over the life of the bonds.
“Just like a homeowner watching for the best mortgage rates and going to a lender when the time is right to refinance and save money, we too, in county government have a great opportunity to save dollars during these incredibly tight times,” Falk said in the release.
The authorization for the refinancing is pending approval from the County Board. With the approval, these loans will be put into the competitive market where the city will refinance with whoever offers the lowest interest rate. The County Executive’s Office expects the process to be completed by mid-February.
“Everybody is tightening their belts right now and trying to save money,” Wescott said. “We are carefully watching our dollars and this is good news for us.”
