City to refinance bonds

Princeton Public Utilities will be saving $34,015 per year until 2024 through the refinancing of the $3,465,000 in public utility system revenue bonds it issued in 2004. The total present-day saving is $346,409 through the much lower interest rate of 2.23 percent. The rate on the original bonding was 4.72 percent.

Most of the bonding was done for electrical needs, noted city financial consultant George Eilertson when the city council approved the refinancing at its Jan. 12 meeting. Eilertson is with the city’s financial consulting service provider, Northland Securities. Most of the electrical work that the bonding financed was the expansion and upgrade of the city’s electrical generating plant and circuit switch gear, nearly seven years ago, according to Princeton Public Utilities Commission manager Dave Thompson.

About 20 percent of the money borrowed in the 2004 bonding went for water infrastructure improvements. The remaining size of the 20-year bonding is $2,450,000 and Moody’s Investors Services has given the bonding an A3 rating.