No relief to pay $24M bond early

WINNSBORO – During a presentation to County Council last month, County Comptroller General Laura Johnson answered a couple of burning questions that, for many in the County, even some County Council members, have remained elusive since March, 2013 – Can the County’s 2013 $24M installment purchase revenue bonds (IPRB) be paid off early and, if so, at what cost?

“Yes, the bonds can be paid off early,” Johnson said at the Sept. 24 meeting, “but there are certain requirements. The process to do this is called defeasance. You would have to pay the principal and interest for the bonds all the way up until 2023.”

“To pay the bonds off tomorrow, you still have to pay the principal and interest until 2023,” Johnson said, “After that, any bonds that are left, you would have to pay the principal only. “So for Series A bond ($3.7M), the maturity date is 2024. Maturity date for the Series B bond ($20.9M) is 2022. After 2023, you only have to pay the principal amount on any remaining bonds.”

“So to pay the bonds off now, we’re still looking at a payout of about $30,000,000,” Johnson said.

“What amount is left of the original IPRB’s that has not been spent to date?” Council Chairman Billy Smith asked.

“There’s about $10M left that has not been spent,” Johnson said. “We can’t just send that $10M back. We still have to follow defeasance regulations, paying the principal and interest until 2023.”

“It would be foolish to pay it all and still pay all the interest,” Councilman Jimmy Ray Douglas said.