Albany utility board recommends city consider early payoff of GPO loan using SPLOST funds

Staff told the board that the city could pay off a GPO loan tied to the East–West interceptor project by reallocating sales-tax proceeds from SPLOST 5, 6 and 7. The presentation included a quoted payoff figure near $10,000,000 and an estimated interest savings of about $359,000.

Staff noted that some SPLOST categories and balances would be adjusted if the board moved forward with the payoff; for example, $615,000 of sales-tax dollars currently noted for another drainage project (Holloway Drainage) was proposed to be reallocated. A finance presenter said the loan’s current compound credit rate is low — staff described the loan as “very low interest” — and that paying it off would free up debt capacity for sewer projects, though not dollar-for-dollar because the loan rate is favorable.

Commissioners pressed for more explanation and context before the city commission acts. One board member said many commissioners may not be aware of the loan’s history and that staff should prepare a detailed pros-and-cons briefing for the commission, noting potential optics concerns and the tradeoff between immediate interest savings and preserving low-rate financing.

After discussion the utility board voted to recommend that the city commission consider using SPLOST 5, 6 and 7 funds to pay the loan. Staff will prepare more detailed materials for the commission that explain the payoff amount, the source of funds and the implications for future borrowing and SPLOST allocations.

If the commission acts on the recommendation it will be the vehicle for any reallocation of SPLOST proceeds and final payment decisions.