County to save $415,000 after refinancing

Officials say the county is set to save more than $415,000 following Tuesday’s approval of the 2007 bond refinance.

The Jasper County Board of Supervisors approved BOSC, Inc. of Dallas, Texas to refinance $3.66 million in taxable general obligation bond at a rate of 2.23 percent, down more than 3 percent from the previous rate of 5.37 percent.

“About a year ago, we started watching your 2007 bonds. They are paying about a 5 to 5.5 percent interest rate, which is very high in today’s market,” financial advisor Jon Burmeister said. “We have been working with Dennis (Parrott) to keep an eye on this and low and behind interest rates have come down a little bit lower again. We thought this was an opportune time to lock in today’s rates, put the money in an investment that will then be used to pay off the 2007 bonds.”

While working to refinance, Burmeister visited with Moody’s Investors Service, a national company that provides credit ratings and researches covering debt instruments and securities, to acquire the county’s rating. Currently, Jasper County is rated an Aa2.

“The county is two notches from the highest rating you can get, a Aaa. For a county your size, you have really achieved the highest rating you can get with the Aa2. You should be really proud of that,” Burmeister said. “All of your budgeting processes that you have implemented in terms of maintaining a strong general fund balance, generating real conservative budgets, you debt balance is low and the economic vitality and activity of the county is strong.”

The refinancing was opened up for bid and seven bids were received electronically Tuesday morning. Bids were received from BOCS, Robert W. Baird & Co., of Milwaukee, Wis., UMP Bank of Kansas City, Mo., Fifth Third Securities, of Cincinnati, Ohio, Piper Jaffray & Company of Chicago, Ill., Raymond James & Asso., of Memphis, Tenn. and FTN Financial Capital Markets also of Memphis, Tenn.

BOCS was selected as the lowest bidder with a final interest rate half a percentage lower than what Burmeister originally planned.

“The savings is in excess of $50,000 per year. We were hoping for $366,000 and came out at $415,093,” Burmeister said. “This a great refunding.”

In other business:

• The board approved a memorandum of understanding between the county and the Iowa Department of Corrections to bring female parole offenders directly to the Iowa Correctional Institution for Women in Mitchellville rather than bringing them to the Iowa Medical and Classification Center in Oakdale.

Contact Jamee A. Pierson at 641-792-3121 ext. 6534 or jpierson@newtondailynews.com