Guin bond issue reduces debt service

GUIN — The City of Guin held a meeting on Tuesday, May 20, to discuss and approve the city’s new bond issue ordinance.
The new bond issue will allow the city to consolidate its debt at a more affordable rate by allowing the city to avoid previously scheduled rate increases.
The new bond issue will also prevent the city from having to use city property as collateral, since it is a general obligation debt.
Matt Adams with Birmingham-based firm Raymond James, who assisted the city with the bond issue, spoke during the meeting to explain the details of the bond issue and how it would help the city.
Adams said the bond market response to the issue had been positive that morning, with one investor in particular expressing consistent interest in the city’s offering.
Adams explained the city had previously been making total annual payments on its debt that ranged from $720,000-$840,000. At the new rate, the city will be making fixed annual payments at around $640,000.
The new bond issue also lowers the interest rate down to 5.08 percent, which dropped from an initial 5.4 percent due to the strong investor interest.
That interest in the bonds allowed the bond term to be reduced from 18 years as previously expected down to 15 years.
The council had to reach unanimous consent for immediate consideration of the issue, which it did, before also unanimously voting to accept the new bond issue.
The new bond was scheduled to be locked in and go into effect beginning today, June 4.