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Radford Council approves roughly $6 million general-obligation bond to restructure debt
Summary
Council authorized issuance of about $6 million in general-obligation bonds at a stated rate of 4.95% to restructure part of the city's existing debt; staff said the restructuring yields about $68,000 in net present value savings over 15 years.
The Radford City Council voted to authorize a general-obligation bond issuance of approximately $6 million to restructure a portion of the city's debt and reduce reliance on short-term borrowing. City staff explained the deal carries a 4.95% interest rate and that restructuring produces a net present value savings of about $68,000 over 15 years. "We have worked with Davenport and Associates, which is our bond counsel, and they have helped us look at the options that are available to the city," a city staff member said while describing the proposal. Council members framed the transaction as an alternative to taking out another revenue anticipation note (RAN) and said it avoids a larger immediate tax increase or deeper service cuts. The council dispensed with a second reading by vote and then approved the ordinance authorizing the bond. City staff told council the financing should cover the payoff of an existing RAN and help with near-term cash flow into July. The ordinance vote was recorded by roll call; councilmembers voted affirmatively during the session.
