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Priceville recalls bonds, lowers debt by $573,000

Priceville Mayor Melvin Duran and City Clerk Kelly Dean sign documents to refinance $2.55 million in general obligation bonds at a lower interest rate. Directing the signing is Attorney Jody Smith with the Maynard Cooper law firm in Birmingham. | Clif Knight

Priceville Town Council generated a $311,000 nest egg for capital improvements by recalling a general obligation bond debt totaling $1,725, adding $850,00 in new warrants and selling them at a lower interest rate at its regular meeting Thursday. At the same time a $223,000 reserve fund, which was set aside to make the final payment on a 1999 bond issue, was released and applied to the overall long-term debt.

The refinancing project was managed by the Birmingham law firm of Maynard Cooper and the bonds were purchased by Branch Banking and Trust Co. of Charlotte, N.C., at a fixed interest rate of 3.7 percent. This lowers the town’s interest on its bonded indebtedness by 2.36 percent over the next 15 years.

Warrants totaling $825,000 were issued for the purpose of financing the purchase of a $375,000 fire truck and relinquishing an existing loan that was used for the acquisiiton, construction and improvement of a maintenance and fire department building.

The other warrants were issued in 1999 for the acquisition, construction and improvement of a new town hall.

Savings will be accrued in annual installments through fiscal 2015.

The new fire truck will be delivered next week after being displayed at a conference of the Alabama League of Municipalities in Huntsville.

Mayor Melvin Duran expressed appreciation to Greg Cochran, president of the Alabama Municipal Funding Corp. and Maynard Cooper’s representatives for their help in putting together a new long-term debt-financing plan for Priceville.

“We have a good history of managing the money of the people we serve and that’s a credit to our council members and employees, Duran stated.  By refinancing our long-term debt at a much lower interest rate we’re reducing debt cost and generating cash for capital improvement at the same time. That’s a win-win for our community.”

The governing body acted on other matters as follows:

• Accepted a low bid of $21,000 from LSI Chuck Long for construction of  30’ x 20’ and  50’ x 20’ tractor sheds at Fire Station #1.

• Approved payment of bills totaling $142,440.58 during the month of May 2011.

• Approved the rezoning of property owned by Charles Williams (located on the south side of Robinson Street) from R-1, single family residential, to C-2, central and highway commercial district.  Prior to approval, a public hearing was conducted and a motion was made and approved to give the proposal immediate consideration.

• The 2010 Morgan County Multi-Hazard Mitigation Plan was approved after Mayor Duran pointed out that not to do so would disqualify the town for federal assistance in the event of a natural disaster.

• Approved the purchase of a two-color, double-sided advertising sign at Priceville Bulldog Stadium at a cost of $300,

• Approved the purchase of a $150 gun rack for Corporal Rick Williams’s patrol car.

• Approved the purchase of a new set of tires from OK Tires for Chief Billy Peebles’s

Tahoe. at a cost of $532,53.

• Approved an expenditure of up to $5,000 for speed breakers in Churchhill Downs Subdivision and noise violation warning signs.