BARRE — Thirty-seven municipalities around Vermont have been offered a better interest rate on their municipal bonds that could save taxpayers more than $2.6 million statewide.
On Monday the Vermont Municipal Bond Bank, a state agency created in 1970 to give Vermont municipalities access to bonds at a reduced rate, offered 37 towns, villages, and other local governments a reduced interest rate on the bonds they took out in 2004.
“It’s no different than when you refinance mortgages when interest rates drop,” said executive director of the bond bank Robert Giroux. “When the interest rates for those bonds were issued in 2004, the interest rates were significantly higher than they are today.”
The bank is offering $2,640,000 in savings on $36,595,000 in bonds by refinancing the original debt. The bank reduces the rates automatically and then informs the local governments of the savings. The governments then have to approve the changes to their bonds.
The city of Montpelier would save $411,564 on $5.705 million remaining in bonds it took out to fund improvements to city hall, the water system, and an ultraviolet disinfectant system.
Sandra Gallup, the city’s finance director, said taxpayers won’t reap the rewards right away. The city would save around $16,000 in fiscal year 2014 and then the savings would go up to around $28,000 for each of the next seven years.
For the complete story see Wednesday's edition.MORE IN This Just In
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