Just like countless individuals who have re-financed home mortgages in the past few months, the Palo Alto County Board of Supervisors did a little re-financing of their own last week that will end up saving the taxpayers nearly $1.8 million in bond interest. The county sold $6,650,000 in bonds at an interest rate of 1.231105 percent, taking advantage of the historic low interest rates in the country.
Travis Sqeures of Piper Jaffray of Des Moines appeared before the board at their Dec. 4 meeting to announce the results of a public bond sale that had been conducted on Dec. 3. A total of six bidders participated in the bond sale.
"The winning bidder was the UMB Bank, NA, of Kansas City, MO, working in partnership with the Iowa Trust and Savings Bank in Emmetsburg, Sqeures explained. "Their bid was for 1.231105 percent."
Prior to the bond sale, the county had received a financial rating of A1 from Moody's Financial Service. "Basically, what that means is that the county has adequate finances, savings, investment plans and has a good history in terms of your financial dealings," Sqeures said.
Interest rates in the sale ranged from the 1.231105 percent up to 1.411330 percent.
Originally, the county had sold bonds back in 2008 to finance road reconstruction projects in the county. Originally, those bonds were sold at 4.250 percent. By re-financing the debt, of the 2008 bonds, the county will realize a savings in interest payments of $1,731,817.
"This re-financing is a very nice step to reduce your interest costs, and to keep you assessment below that $1,61 per thousand that you committed yourselves to when you took this to the taxpayers in 2008," County Engineer Joel Fantz told the board. "The risk versus reward made this re-financing possible and beneficial to the taxpayers."
"On behalf of Iowa Trust and Savings Bank, we would like to thank the board for this re-financing opportunity and the opportunity to work with the county," Kris Ausborn, President of Iowa Trust and Savings Bank told the supervisors. "The savings through your action for the county is tremendous."
"This has been a very involved process," Sqeures noted. "There was great cooperation from Carmen Moser in the Auditor's Office and Mary Hilfiker in the Treasurer's Office along with Joel. Piper Jaffray thanks you for working so diligently with us and we appreciate our relationship with Palo Alto County."