PTC Council pays airport debt early to save $17K in interest payments
In a move to save the city more than $17,000 in interest payments the Peachtree City Council on March 7 voted unanimously to pay off the remainder of the 2002 airport bond. The vote enables the city’s next bond millage rate to be reduced by .012 mills.
Financial Services Director Paul Salvatore said the Series 2002 General Obligation Bond for airport refinancing carries a current balance of $310,000 and an interest rate of 4.5 percent and 4.6 percent on the remaining maturities. A bond payoff on April 15 would save the city $17,355 in interest payments over the bond’s two remaining years, Salvatore said. An early payoff would also reduce the bond millage rate by .012 mills on the next tax levy, Salvatore said.
Salvatore said the payout amount would be funded by cash reserves and would total be $314,355.
“Staff estimates that our reserve levels would still be at an adequate level of approximately 34 percent by fiscal year’s end if we amend the FY 2013 budget to fund this transaction,” Salvatore said. “We also do not believe that this will hurt our credit ratings since it would be a one-time expense used for reducing bonded debt.”
Salvatore said city financial advisor R.W. Baird supported the payoff.