City’s financial adviser says it’s a good time to refinance
In light of lower interest rates being offered, the city of Pierz may save up to $2,000 a year if it refinances its stormwater bond. That could be upward of $16,000 over the remainder of the life of the bond.
City Administrator Anna Gruber told the Council Monday, that the city’s financial adviser, David Drown, recommended the city refinance the bond.
The original amount of the bond in 2006 was $435,000; $330,000 remains with final payment to be made in February 2020.
The project was completed to mitigate water levels in the ponds near the Pond View Estates development in Pierz, said Gruber.
“It was a storm sewer main that was installed to drain water from the Pond View Estates area to the Skunk River,” she said.
The current interest rate for the bond is 3.9 percent, but that rate will increase to 4.1 percent in 2013, 4.3 percent in 2017 and 4.4 percent in 2020.
The Council asked Gruber to check with Drown about whether refinancing would extend the life of the loan, feeling that if the loan were extended in the process, it would not make financial sense.
Also unknown until the city applies for refinancing, is what the actual interest rate the city will qualify for.
Gruber said Drown will likely speak with the Council in the future to present the financing figures and to close on it.
Pierz City Council Briefs
In other business at Monday’s meeting, the Pierz City Council:
• Approved gambling permits for Holy Trinity School for sale of its fundraiser calendar and for bingo March 11, 2013;
• Approved, upon the recommendation of the Planning and Zoning Board, to approve a permit for a house addition for Brad Bednar;
• Gave City Administrator Anna Gruber the go-ahead to fine tune the city’s current dog licensing program. Gruber proposed making all dog licenses due at the same time during the year to make it easier to keep track, to order new license tags which will include a phone number, rabies vaccination dates and will be easier to read to ensure law enforcement can return pets to their owners. Gruber would like the new system in place by January 2013; and
• Approved a bid for injection patching from Commercial Asphalt Repair, Grand Rapids, at a cost of $2,830. The company will use spray injection patching on portions of Robert Street and Park Avenue. Bob Otremba, Public Works director, said an overlay on the same area would cost between $18,000 – $20,000.
The Council will meet Monday with the Park Board at City Hall at 6 p.m. The next regular City Council meeting will be held Monday, Oct. 8, at 7 p.m. at City Hall.