The city may be able to save $100,000 this year and $200,000 each year through 2021, if council members move to refund bonds used to acquire land for Jordan Valley Park, Finance Director Mary Mannix Decker told Springfield City Council on Nov. 15.
A pair of special ordinances was unanimously approved at council’s meeting and would refinance $11.8 million in bonds from 1998 and 2000, if council approves the proposal Nov. 29.
“Our policy is to take advantage of lower rates, and this is a time of historically low rates,” she added. “It’s very similar to refinancing a house. Home rates are low right now and so are bond rates.”
Decker said payoff on the proposed bonds would still be planned for 2021, which means the current terms would not be extended. The city currently is paying 5.7 percent interest on the bonds, and if council moves to recall them, the anticipated new interest rate would be just above 3 percent.
She said the Finance Department periodically reviews the city’s long-term debt looking for opportunities to save money, noting that the current proposal is similar to a spring bond reissue that reduced interest rates to 3.1 percent from 3.31 percent.
Decker said exact rates would not be known until the bonds are issued, which would happen after Dec. 1 with council approval. The city would have an opportunity to back out of the proposal should interest rates skyrocket before the bonds could be sold.
The money saved would go into the city’s general fund, which Decker said has been subsidizing lower-than-expected revenues from the hotel/motel tax. In fiscal 2010, the city subsidized $434,000, which went toward a variety of projects, and the tax generated just shy of $1.6 million for the Jordan Valley debt, Decker said.
The city is responsible for $2 million in bond payments each year. Earlier this month, the city cut a $1 million check, and if the bonds are refinanced the next scheduled payment in May would be reduced to $900,000, Decker said.
Crime-fighting money
Council unanimously approved a bill to accept a $2.15 million grant from the U.S. Department of Justice Office of Community Oriented Policing Services. According to
www.springfieldmo.gov, the money will be used to hire and pay the base salaries for 15 new uniformed police officers. The COPS grant covers 100 percent of the approved entry-level salary and benefits of each officer hired for three years. The Springfield Police Department is required to retain the COPS-funded positions, at local expense, for 12 months following the federal funding period.
Rainwater grant
On Nov. 29, the council will consider a $10,000 grant from the James River Basin Partnership to fund installation of pervious pavement on Park Central East and a rain garden on Park Central West, according to Phil Broyles, assistant director of Public Works.
“Pervious pavement slows down and decreases runoff, and rain gardens are also a water quality issue,” Broyles said.
JRBP was formed in 1997 as a 501(c)3 with the goal of improving water quality in the James River watershed.[[In-content Ad]]
