Commission talks debt refinancing
by James Phillips
Feb 05, 2013 | 2678 views | 0 0 comments | 9 9 recommendations | email to a friend | print
Keith Davis
Keith Davis
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Members of the Walker County Commission spent more than an hour Monday morning hearing from representatives from various financial companies interested in refinancing the county’s debt.

Terry Hogan of Joe Jolly and Company, Melanie Kammerer of Gardnyr-Michael Capital, Matt Adams of Raymond James/Morgan Keegan and Chris Williams of Sterne-Agee each gave proposals to commissioners. The four had originally been scheduled to address commissioners at a work session in January, but snowy weather forced that meeting to be cancelled.

Commissioners are considering refinancing the county’s debt for a variety of reasons.

“We’re not just refinancing to be refinancing,” District 1 Commissioner Keith Davis said. “We are going to be able to save the county some money, but we are also going to be able to improve our financial situation by doing this.”

Davis said debt from a bond issue taken out by former commission members in 2002 is a major concern for current commissioners. If not refinanced, a $1.7 million payment will be due on that debt in 2018.

“They borrowed $9 million and promised to pay back $27 million. That just doesn’t make a lot of sense,” he said. “The payment on that $27 will be due in a few years, and refinancing now will help us to be better able to take care of that payment in the future. The debt is there, so we can’t get rid of it, but we can put the county in a better place to pay that debt.”

Each of the presenters during Monday’s meeting said the county could save $2.5 to $3 million by refinancing now. Davis said he expects commissioners will hold a work session before its next meeting on Feb. 18 to discuss the refinancing further.

“We need to act now if we are going to do this, because projections show that interest rates could go up a lot in May,” he said.

During the financial presentations, Davis said the county could borrow money from its gas tax fund to help obtain a large amount of funds for resurfacing area roads, through the state’s ATRIP program.

“We could borrow $2 million to get $10 million,” Davis said.

Commission Chairman Billy Luster said the ATRIP funding would be beneficial to the county.

“This is going to be a one-time opportunity,” he said. “It is an 80/20 match, so we have a chance to be able to get some funds to work on our roads. That’s something that we hope we can do.”

The deadline for entering projects for the next round of ATRIP funding will be May.

David Knight, director of the Walker County Economic and Industrial Development Authority, also spoke to commissioners Monday about the county’s unemployment rate, which has dropped to 6.7 percent.

“Unemployment in Walker County is on a downward trend right now,” Knight said.

Davis said the county’s financial security and unemployment rate go hand-in-hand.

“We all campaigned on handling this debt and brining jobs to Walker County,” he said. “Those two things are connected. We have to be financially sound to be able to offer incentives for companies to come here. We want to see that unemployment number down around 4.”

In other action from the meeting, the commission:

•Approved a budget revision request for the revenue commission’s appraisal budget.

•Approved an annual agreement with the East Walker Chamber of Commerce.

•Accepted a homeland security grant for $2,035 to purchase an AED machine.