Posted 10 months ago
By Post Staff
The Chadron City Council has approved issuing another $2-million dollars in one-year Bond Anticipation Notes for the city’s $4-million dollar storm sewer expansion and upgrade project. The first $2-million in notes was issued in the spring.
John Tracek of Ameritas says that while the project will eventually be financed with 15-year revenue bonds, the Bond Anticipation Notes are needed because the bonds themselves can’t be issued until the project is finished.
Tracek had recommended the notes be issues in two parts because the city didn’t need the full $4-million right away and could cut the interest costs on the second $2-million. The savings proved to be a little over $10,000.
The interest rate on the new set of notes is 1.4% when all costs are added in, about 5-100ths of a point higher than the first notes.
Interest payments are due at 6 months and one year, but city can call the notes without penalty if it’s ready to issue the bonds before the notes mature…which will be likely since the project is scheduled for completion later this year.