Columbus to save $500k+ with Commons refinancing

Local News

Columbus City Council gave its first approval to a plan to save the city more than half a million dollars. The council last night approved a proposal from its financial advisors to move forward refinancing the $9 million in bonds used to build The Commons.

Finance director Jamie Brinegar explains that the savings would amount to about $53,000 annually, or about $530,000 in savings over the remaining life of the bond.

Brinegar says the city would be able to use that $53,000 a year for other projects and initiatives.

That savings includes all the fees and expenses of the refinancing.

The refinancing would allow the city to cut the interest rate in half. The existing bonds were financed at about 4 percent, but the new bonds would be at about 2 percent interest rate.

Councilman Frank Jerome wondered whether there would be larger savings if the city kept paying the same, larger annual payments it is already paying, but paid the bonds off more quickly. However Mayor Jim LIenhoop and Councilman Tim Shuffett said they would rather have the annual savings on hand now to pay for other city needs.

The city’s financial advisers suggested that paying the bonds off earlier would only save about $30,000 and it would require difficult restructuring of the bond agreements to accomplish.

Because the city is not actually eligible to call the bonds until 2019, the refinancing will require some financial shuffling to make the new arrangement work.

In other business, City Council:

  • Prepared the city to start receiving funds from its partners for the estimated $30 million overpass project heading into downtown. The City Council approved a new fund last night that will allow the money to build up for the project and will ensure the money will only be used for the overpass. Brinegar said the $30 million is expected to be a high estimate and if the project comes in for less, any donors to the project will be refunded proportionately.
  • Gave the necessary final approvals to allow a small parcel to be annexed into the city and rezoned so it can be incorporated into the larger Arbor Homes project off of Lowell Road and County Road 200W.