Premiums, as Commissioner Bill Lashley said several times, are not free money. They have to be paid back. But, when Commissioner Steve Carter called them interest-free money, Lashley, who has a background in finance, said “pretty much.”
It’s a little complicated. Voters approved just $189.6 million in borrowing, but that vote also approved paying interest. Interest rates vary, so their cost won’t be known until they are locked in.
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The county projected a 5% interest rate when calculating how much it would be paying on those bonds. But unless something very surprising happens, when ABSS issues its bonds April 20, the rate will be much lower than 5%. The peculiarities of the municipal bond market mean investors can bid more than the face value of those bonds, which could potentially bid up their value by $20 million or more. That would mean the county could borrow $174 million instead of $150 million and ac