County saves on refinancing debt

AAA bond rating translates into millions in interest

December 09, 2007|By LARRY CARSON

Howard County expects to save $6.3 million in interest payments during the next dozen years by refinancing $104 million in nine-year-old bonds.

The sale Wednesday refinanced $92 million in general county bonds and $12 million in water and sewer bonds, said Sharon Greisz, county finance director.

By getting a 3.57 percent interest rate - a full one percentage point lower than the average interest on the old bonds - Greisz said the county would save $520,000 a year in interest, totaling $5.3 million in savings over the life of the general bonds, and $48,000 a year totaling $1 million in savings for the water and sewer bonds.

The bonds were sold to a series of retail brokers and large investment groups, who were prepared to buy $223 million worth, had that much been available, Greisz said.

"We did very well - better than anticipated. People just wanted our bonds like crazy," she said. With uncertainty inspired by the subprime credit crisis, Howard County's top-rated AAA credit attracted investor interest, enabling the county to get a lower interest rate.

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