State refinances more bonds to save $6 million
June 6, 2012
The treasurer’s office has refinanced another batch of bonds to take advantage of dropping interest rates.
In March, the office refinanced more than $123 million in existing bonds, cutting interest rates from more than 4 percent to about 2.5 percent. That will save the state about $9 million over the life of the bonds.
On Tuesday, the Board of Finance was told another $66.49 million in highway fund bonds were refinanced. That refinancing will save NDOT some $6 million in interest.
“This is money they would have been spending on debt service that they don’t have to,” said Treasurer Kate Marshall.
Together, those refinancing actions free up some $15 million of debt capacity.
In addition, Truckee Meadows Community College bought out bonds used nearly a dozen years ago to buy space for classes at Old Town Mall in Reno. The university system used student fees in excess of what was budgeted to pay off the bonds.
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Paying off those bonds frees up another $5 million under the constitutional debt cap.
With the state close to its maximum permissible bond debt, Marshall said even those small amounts are very helpful.