City completes bond refinancing at advantageous rates
January 14, 2021
PROVIDENCE, RI – Mayor Jorge O. Elorza today announced that the City of Providence has closed its 2021 General Obligation Refunding Bond transaction. The City issued new tax-exempt bonds with a five-year final maturity at a True Interest Cost of 0.93% and new taxable bonds with a seven-year final maturity at a True Interest Cost of 2.02%. These new bonds pay off existing bonds at a rate of 4.99%. That interest rate differential will provide $1.8 million in savings this fiscal year (FY21) and $220,000 next year (FY22) for a total savings of $2.02 million.
“As we continue to navigate the City through this tumultuous fiscal year due to COVID-19, we are confident that we will emerge from this storm together stronger than ever,” said Mayor Jorge O. Elorza. “I would like to credit our Administration, in collaboration with our City Council, along with our department directors and managers for our sound fiscal management that will help us weather the economic storm this fiscal year and the years to come.”
The City, along with its bond counsel, Locke Lord, and its municipal advisor, Hilltop Securities, worked with JP Morgan on the refunding.