Hampton could net windfall from refinancing '02 bond
Share with others:
Hampton will have the opportunity this month to refinance a 2002 bond issue worth $4.2 million that will lock in a lower interest rate, and yield a windfall for the township of between $450,000 and $500,000.
Randy Frederick of the Pittsburgh investment firm Piper Jaffray informed council members Jan. 25 about the refinancing arrangement.
Council President Victor Son said council has given its approval to start proceedings, which will allow Piper Jaffray to prepare the paperwork to lock in the lower rate. He said the township's debt service payments would remain constant and the bond's due date of 2027 would remain the same.
"Nothing will change, but the township will get this money up front," Mr. Son said.
Manager Christopher Lochner estimated the lower interest rate to be a difference of at least 2 percent.
He said the earliest the money would be available will be March and it likely will go into the general fund, where it can be used to make advance payments on the upcoming Duncan Avenue/Route 8 intersection project.
The PennDOT-managed project encompasses construction of a detention pond and culvert and additional turning lanes. Work is expected to begin in the summer or fall.
Mr. Lochner said that the township is acting as contractors in the project and will be reimbursed by the state for payments made up front.
"We will probably dedicate [the half-million from the bond refinancing] to do the advance funding on the road project," Mr. Son said. "The reimbursements from PennDOT will then put us $500,000 ahead."
Council likely will vote on the matter on March 14.
Mr. Lochner said that the Duncan Avenue project is expected to be completed by Jan. 1, 2014.
In other action, two new subdivisions received council's approval.
The Bishop Ridge Subdivision consists of five acres located at the corner of Chessman Street and Christopher Drive and will provide eight single family parcels.
The Wood Wind Subdivision wants to develop approximately 15 acres of property located on Duncan Avenue, just past The Arbors, into 17 single-family parcels. Due to wetlands, the developer also must seek approval from the state Department of Environmental Protection.
First Published February 2, 2012 5:48 am
