PROVIDENCE – The city recently closed a transaction refunding its 2021 general obligation bonds, according to a news release.
The new, five-year tax-exempt bonds were issued at a 0.93% interest cost, while taxable bonds were issued at a 2.02% interest cost and seven-year maturity. The bond issuing will pay off the city’s existing bonds at a 4.99% rate.
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The interest rate differential will provide $1.8 million in savings in fiscal year 2021 and $220,000 in fiscal 2022 for a total savings of $2.02 million, according to the release.
The City Council in December authorized refunding of the city’s 2010 general obligation bonds, which were estimated to generate $1.3 million in net savings to cover the city’s outstanding pension liability.
Nancy Lavin is a staff writer for the PBN. Contact her at Lavin@PBN.com.
