Covington hopes to save more than $200,000 by refinancing bonds

Hoping to benefit from better interest rates, the Covington City Council has authorized its bond attorneys to seek permission from the State Bond Commission to refinance two sets of existing bonds. Covington City Councilman Matt Faust By refinancing the bonds the council hopes to get better interest rates and realize a 10-year savings of more than $200,000, officials said....

Hoping to benefit from better interest rates, the Covington City Council has authorized its bond attorneys to seek permission from the State Bond Commission to refinance two sets of existing bonds.

Covington City Councilman Matt Faust

By refinancing the bonds the council hopes to get better interest rates and realize a 10-year savings of more than $200,000, officials said.

"The rates are really low right now so we might be able to save some money,'' Councilman Matt Faust said.

The refinancing, council members said, would not extend the life of the existing bonds or require any additional taxes.

The 2002 bond issues -- one for $4.45 million; the other for $1.24 million -- were for water and sewer system improvements. The 20-year bonds were backed by sales and property tax extensions voters had approved the previous year. Voters approved extending a 1-cent sales tax until to 2027, and a 6-mill property tax until 2021.

The city owes $3.75 million on the bonds. But because both have 10 years remaining, bond attorneys told the council that should mean a better interest rate than what the city had been paying when it initially issued the 20-year bonds.