The Washington City Council approved an ordinance to refinance certificates of participation (COPS) that could yield a savings of up to $750,000.
The council approved the ordinance with a 7-0 vote to begin the process of refinancing Series 2012B Certificates. Councilman Mark Hidritch was not at the meeting.
Reagan Holliday, with Hilltop Securities Inc., said the city has an outstanding principal of $24.2 million on the bonds. The money was mostly tied into the Highway 100 expansion and the construction of the new library.
The final payment for the bonds is due in 2030. The city began looking into refinancing in 2017 to take advantage of a favorable market and save money. However, Holliday noted that the market was not ideal to refinance at that time.
“There was a lot of tax reform changes proposed at that time,” she said. “In 2018 the rates did not go back down.”
Holliday added the savings is estimated to be between $500,000 and $750,000 if the COPS are refinanced now.
“The market definitely has shown there is a lot of demand for bonds, which is a good thing because there are not a lot of bonds on the market,” she noted.
When the capital sales tax was approved in 2010, the bond market and construction market were both favorable so the city took advantage and used bond funds to start construction sooner.