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On April 27, 2021, the City of Roanoke successfully sold $64.165 million in General Obligation and Refunding Bonds, of which $22.05 million was for new capital projects, $33.24 million was to take out an existing bond anticipation note, and $8.875 million was to refund existing debt to realize savings associated with lower interest rates. The cost of borrowing the funds was approximately 1.6%, which is a historically low interest rate. By refunding existing debt, the City will reduce its annual debt service thereby saving $539,000 over the life of the debt.
“The issuance of this debt at historically low interest rates ensures we can continue to provide the facilities and infrastructure our community requires at a very affordable cost,” said Bob Cowell, City Manager. Also, Mayor Sherman Lea stated, “Our ability to invest in needed capital items at historically low interest rates and at the same time, save taxpayers more than half a million dollars by refunding existing debt is an achievement worth noting.”
The cost of borrowing and the savings are a result of the City’s strong credit ratings and fiscal policies. In March, the City initiated reviews by the three national credit rating agencies: Moody’s, S&P, and Fitch which resulted in affirmation of the City’s strong ratings (Aa2, AA+, AA+ respectively).
For more information, contact Amelia Merchant in the City’s Finance Department at (540) 853-6805 or send an email to Amelia.Merchant@roanokeva.gov.