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JAA refinances $20 million of bonds, saves $2 million
Aug 9, 2013
Carole Hawkins -
Jacksonville Business Journal
The Jacksonville Aviation Authority in July refinanced $20 million worth of bonds to a 0.85 percent fixed rate saving $2.55 million over a five-year term.
The interest rate on the bonds had ranged from 3 percent to 5.25 percent, JAA spokeswoman Debbie Jones said. The loan was made with Miami-based Sabadell United Bank.
The move is part of a JAA plan to convert all of its bonds to fixed rate bank loans, she said, “in order to take advantage of the current low interest rate environment.”
The agency in December converted $53 million worth of bonds, with interest rates ranging from 4.40 percent to 4.625 percent, to a fixed rate loan with TD Bank, at an interest rate of 1.73 percent. That will save $15.3 million over an eight-year term.
It plans to convert another $55.8 million worth of bonds in 2016.
JAA instituted the program as a best business practice in order to reduce the authority’s expense cost and improve operating margin and cash flow, Jones said.