City's Bond Refinance Saves Taxpayers $600,000

Release Date: 

When it comes to selling bonds, getting good grades certainly pays off.  Standard & Poor’s recently rated the City of Hermiston’s Full Faith and Credit Bonds as A+.  The City of Hermiston is now set to save $600,621 over the next 20 years by refinancing bonds originally issued in 2003.

The original bonds carried an interest rate of 4%, escalating to 4.65%.  The bonds, which still have 20 years until maturity, now carry a net interest rate of 2.81%.  The reduced interest rate means the City will pay $600,621 less than it otherwise would have under the old rates over the life of the bonds.  The annual savings to taxpayers then comes out to an average of approximately $30,000 per year.

The savings, when adjusted for “Present Value,” or what the total savings equate to in 2013 dollars, come out to $465,016.

Read the full refinancing report HERE.


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