Denton County officials look to enjoy hundreds of thousands of dollars in annual savings as they issue debt for two county improvement projects.
Taking advantage of the county’s high bond rating and a great time to get good interest rates on borrowed money, commissioners recently accepted bids that will help pay for transportation projects and to replace the aging communications systems for the Denton County Sheriff’s Office.
“Once again it’s largely due in part to our AAA bond rating that affords us the opportunity to get the debt issuance at such a great rate,” County Judge Mary Horn said. “If there is one good thing you can say about a down economy, it is a great time to be able to borrow the funds.”
Officials accepted two types of bids Tuesday.
One bid was for $29,245,000 in improvement bonds. According to county auditor James Wells, 99 percent of that funding will go toward transportation projects in the Trip 08 bond package county voters approved in 2008.
Citigroup Global Markets Inc. of Dallas proposed the lowest of eight bids for the 25-year bonds, at 3.49 percent, making it the county’s pick.
The other bid was for $11.2 million in tax notes that will fund technology projects, one small building renovation and then 90 percent of the money will go toward the replacement of the sheriff’s communication system.
The current system is at least 15 years old with parts for it on the verge of obsolescence, Wells said, increasing the immediate need to replace it.
The tax notes are a short-term, seven-year debt at a 1.41 percent interest rate.
BOSC Inc. of Dallas emerged from a crowd of 11 firms looking to loan the county the funds for the notes.
The interest rates are beyond what entities with average or good credit ratings would ever get, Wells said, which will lead to about $300,000 in annual interest savings for Denton County.
“Because the county is AAA-rated by the bond rating agency, the highest debt rating that can be had, higher than the state of Texas in fact, it’s a good time for us to get these projects identified,” Wells said. “These are critical needs or things that are part of our ongoing plan, so it’s a good deal for us to keep things moving forward.”
BJ LEWIS can be reached at 940-566-6875 and via Twitter at @BjlewisDRC.