Commission looks at ways to cut courthouse payback
by Jazz Clark
A lower interest rate and quicker payback period could save over $150,000 in repaying the millions of dollars in bonds that financed the new Morgan County Courthouse.
Once the Morgan County Commission decides on how much to pay back by the end of March, a decision will need to be reached to secure a special interest rate from the state of 3.125%.
The commissioners cannot borrow money beyond their term of office, which is why the Morgan County Building Commission acts as their borrowing arm.
The amount left to pay on the courthouse loan is $7,597,711. The lower interest rate would save the county more than $2 million dollars over the life of the bonds.
The commissioners have been told that usually the best rate possible for this type of loan is 4.75%.
The original state loan was five years at 1% before switching to the current agriculture loan, which is currently locked in at 4.75%.
The option exists, however, to base interest on the lower closing rate, instead of the committed one.
“This is certainly the lowest Department of Agriculture interest rate I have seen,” Attorney John Stump of Steptoe & Johnson recently told the commissioners. “We don’t want to miss the chance on this rate.”
Stump originally sat down with Commission President Brad Close to discuss the refinancing a few weeks ago.
“Every time we have a chance at cheap money, we should take it,” Close said. “We owe it to the taxpayers to move forward. It’s a win-win.”
A second reading of the ordinance to repay the bonds will be put before the Morgan County Building Authority on Thursday, February 14.
The county commissioners will again take up the matter at their meeting on Thursday, March 7.