Winooski, VT (April 7th, 2021) – The Vermont Bond Bank (“Bond Bank”) completed a refunding of previously issued loans for 20 borrowers this week. Total interest paid on the loans over their remaining lifetime will be reduced by 64 percent.
The refundings were part of a larger bond issuance that closed on March 4, 2021 that provided $31.16 million in loans to 11 communities.
The Bond Bank regularly monitors the market for opportunities to refund prior bonds and pass back savings to borrowers. The most recent refunding is the latest in a long line of prior refundings, most recently as part of the 2010 Series 4 bond issuance.
The taxable refunding contained multiple innovations for the benefit of borrowers. First, the bonds were issued on a taxable basis, which allowed the Bond Bank to better make use of earnings on the debt service reserve fund. Second, the refunding bonds were structured to facilitate the lowest net interest cost for borrowers.
The Bond Bank will continue to look for additional refunding opportunities on behalf of its borrowers as part of its next loan pool in the summer of 2021.
About the Bond Bank
The Vermont Municipal Bond Bank was created by the Vermont legislature in 1970. The Bond Bank is governed by a five-member Board of Directors with four appointed by the Governor and the State Treasurer serving as an ex-officio member.
The Bond Bank is a state instrumentality with a mandate to “foster and promote by all reasonable means” access to long-term debt financing for governmental units while, to the extent possible, reducing related costs to taxpayers and residents.
The Bond Bank also co-manages the Clean Water and Drinking Water State Revolving Funds with the Department of Environmental Conservation.
Please visit vtbondbank.org for more information on the Bond Bank and its programs.
Contact: Michael Gaughan
Email: [email protected]