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After receiving proposals from banks for a private placement transaction for the refinancing of bonds issued for the construction of the Tired Creek Lake dam, Grady County Lake Authority members are encouraging the county commission to support a public issuance, which will save the county considerable interest expense.
Lake Authority chairman Steven Childs, vice chairman Chip Wells (via teleconference) and authority member Bob Ponder met with the county commission last Tuesday, July 7.
Grady County administrator J.C. (Buddy) Johnson III, and authority vice chairman Wells briefed the authority members and commissioners on the status of the refinancing.
According to Johnson and Wells, Raymond James, who is serving as underwriter for this transaction, found that the rates for a public issuance compared to a private placement were considerably lower and in the authority’s and county’s best interest.
Officials with Davenport & Company, financial consultants to the Grady County Commission, had suggested the county could expect rates for a private placement transaction to be in the 1.25 percent range. What banks actually proposed were rates in excess of 2 percent.
Local officials had planned to meet with the underwriter and bond counsel along with the county’s attorney Gabe Ridley this week to move forward with the process, but with a public issuance, additional work is necessary. Officials with Raymond James said they anticipated being able to close on the transaction in three to four weeks if not sooner.
“This is not terrible. We are in good shape,” Johnson said.
“We’re going to save a bunch of money and that’s what we’re here for,” authority chairman Childs commented.