By: By Wayne Allen
August 18, 2013
PDT Staff Writer
In a Thursday special meeting of the Scioto County Financial Planning and Supervision Commission, a vote was taken to allow the Scioto County Commissioners to refinance one of its existing bonds. This action could result in savings of up to $500,000 over the life of the bond.
“We have an opportunity renew those bonds at a savings of about $546,000 for the term of the loan. That equates to a savings of around $40,000 a year, which would be a boost to the general fund. This is basically a no-brainer,” said Mike Crabtree, Chairman of the Scioto County Commissioners to members of the commission.
Chris McCoy, of the Auditor of State’s Office said the information that was presented to the commission was coming via bond council.
“Bond council has sent us the perspective of what the new debt issuance would be. It’s a refunding so, they (Scioto County) are taking some of the old debt they have now and getting a better interest rate on it,” McCoy said. “The debt will be extended over the same life period of the current loan, but at a much better interest rate.”
McCoy said if the county has the opportunity to save $40,000 a year, why would they not take advantage of it?
“The debt is supposed to end in 2025, that would be the last payment, so you are looking at a 12-year period. I’ve matched everything up and think the numbers look good,” McCoy said.
When asked what the bonds where initially issued for Crabtree said, “It was for the Shelton (Industries) building, the co-signing of the Shelton building. Over the past eight years that I’ve been here we have tried to issue court orders for the gentleman who was responsible for the debt in the first place to come and testify to his current financial status. We have sent certified letters and over that period of time, they have been undeliverable.”
Crabtree said the county has not been able to do anything else in the way of eliminating that debt.
“We’re stuck with it, so we were trying to minimize something that was a bad deal to begin with,” Crabtree said. “The building is part of the old steel mill property (in New Boston). Unfortunately the loan was never tied directly to any property, it was tied to the business.”
Crabtree said once the business folded, there was nothing to sell help to pay down the debt.
“We are stuck with a cosigned loan that started in 1998 and will run through 2025,” Crabtree said.
In 2012 Scioto County made a payment of $262,020 towards the debt, marked the Grace Street Project Bond.
After some discussion, the commission voted unanimously to approve the measure.
The next meeting of the Scioto County Financial Planning and Supervision Commission is scheduled for Oct. 15.
Wayne Allen may be reached at 740-353-3101, ext. 228, or email@example.com. For breaking news, follow Wayne on Twitter @WayneallenPDT.