Putnam County should save some $1.8 million in interest costs by refinancing the bonds on Monterey and Upperman schools.
County Commissioners gave Mayor Randy Porter the authorization to move forward with the plan Monday night.
“It depends on the market the day that we do the refinancing but $120,000 to $140,000 a year in just interest costs,” Porter said.
The bonds issued at the request of the School Board in 2013 carry interest rates of three percent. With the current market situation, Porter said advisors believe they can get that number to about 1.8 percent. Porter told commissioners Monday night he would make the move at the best time for the county based on current conditions.
Porter said the current bonds were not set to refinanced until 2023. The county had to request special permission from the State Comptroller’s office to move forward.
“Previous years and financial advisors had recommended that the county back load their bonds,” Porter said. “The first ten years you pay very little on the bond and then you would really pay big amounts in the final years. That was ruled unlawful by the Legislature back a few years ago and you’re not allowed to do that. So, we were looking at refunding this bond. We had to request special permission from them to be able to do it.”
Porter said the county’s highest remaining bond would carry a rate of 2.35 percent.