City to save $545,000 through bond refinancing

Published 8:41 pm Tuesday, November 12, 2019

The council approved Tuesday the refinancing of a bond that will save the city $585,000 over the life of the bond.

The bond was issued by the Industrial Board to Golden Boy Foods in 2011 with the City of Troy guaranteeing the funds.

The refinancing drops the interest rate from 4.68 percent to 2.78 percent without extending the maturity of the bond, and the repayment is paid through rental payments by Golden Boy.

Sign up for our daily email newsletter

Get the latest news sent to your inbox

Combined with the refinancing of the CGI bond issue last week, the moves will save the city $1.1 million.

“This is an outstanding result,” said Rush Rice, financial adviser. “The $585,000 in projected savings is a net of all fees and expenses.”

“This is a big win for us as far as savings,” said Mayor Jason Reeves.

The council unanimously passed the ordinance after suspending the rules Tuesday. Although the council already read the ordinance last meeting, a change was made to ensure that Synovus could increase the rate if the IRS decides the bond is taxable.

Rice said that would be “incomprehensible,” and even if it did happen, the rate is still lower than the current rate that is being paid. But failing to pass the ordinance before Nov. 27 would have forced the financial team to start over, with no guarantee that they could get such a low rate again.

The council also approved a new agreement to bring new card-readers to the utility department that will be capable of reading chips and working with Apple Pay for users, all while providing a cheaper rate to the city. Utilities Manager Brian Chandler said no charges are passed along to customers.

The council also approved a request for proposals for ambulance services, making changes from the previous contract request. The previous contracts have been guaranteed for three years with two additional annual extensions if all parties agreed. The new contract guarantees two years with three additional annual extension options.

The request for proposals also includes language that will fine the ambulance service if it does not respond within certain set times for each jurisdiction. The council also entered an agreement to collect billing for expenses incurred when the Troy Fire Department transports someone to the hospital using its ambulance.

In other business, the council:

• Approved a 10 percent monthly bonus for employees for Christmas and a $75 bonus for part-time employees and school crossing guards.

• Approved A professional services agreement with Jackson Thornton to conduct studies for the Utilities Department.

• Approved contracts with OCAP, Boys and girls Club, Pike County Economic Development Corporation, Juvenile Court, and East Central Mental Health

• Approved an ordinance that will allow Fire Marshal Brandy Cox investigate and make arrests in fire-related crimes