LGC approves Ahoskie plan
AHOSKIE – Town officials here have approved a plan to refinance a General Obligation Bond that will result in significant savings to its long-term debt service payments.
Over the past few months, members of the Ahoskie Town Council have discussed ways to save money in an effort to grow their General Fund Balance. Some of that discussion centered on the town’s outstanding debt on the wastewater treatment facility that was completely rebuilt and enlarged 10 years ago.
The outstanding balance on the bond is $9,464,000.
After issuing requests for proposals from financial institutions, Truist Bank (formerly known as BB&T) submitted an offer to purchase the town’s existing General Obligation Bond for a price not to exceed $9,621,000.
“The [Ahoskie Town] Council accepted that proposal,” said Town Manager Kerry McDuffie.
He explained the offer from Truist lowers the existing interest rate from 4.125 percent to 2.86 percent. It also trims 11 years off the remaining number of annual debt service payments.
“Actually we will be making quarterly debt service payments under the proposal from Truist instead of making that one large annual payment,” McDuffie noted.
“Combined, the lower interest rate over 20 years instead of 31 years, plus making quarterly instead of annual payments will save the town $3,509,000 over the life of the loan,” McDuffie added. “I commend the members of our Town Council for seeing the big picture here to save this much money down the road.”
As part of the plan, the town filed an application with the Local Government Commission (LGC), requesting its approval of the issuance of the refunding bond.
At its scheduled meeting on April 13, the LGC approved the town’s request.
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