News Section: Local Government
Port Manatee to Save Big on Debt Consolidation
Palmetto -- Good news is always welcomed especially in the financial world. At Thursday's Port Authority/BOCC special meeting, commissioners voted to get their economic house in order. With the adoption of Resolution PA12-17 and PA12-18, it did just that. Much like a mortgage modification, they knocked a little off and locked their debt payments down to a very manageable rate.
Municipal bond interest rates are at historically low levels and Port Manatee is making a move. Mr. Ed Bulleit, of MBS Capital Markets, has orchestrated a consolidation of the Port's current outstanding bonds to a lower interest rate and their commercial paper debt away from its variable rate to a low fixed-interest rate of 3.6 percent.
Resolution PA12-17 Authorized the Authority to issue revenue bonds from time to time in order to finance and refinance port facilities, while PA12-18 authorized the Port Authority to negotiate the sale, with a cap on the amount.
The 3.6 percent is fixed for a 30-year period. The goal was to produce a vehicle that could provide revenue when needed, and in the process absorb all of the past debts and dealings the port has encountered to put them under one umbrella. In the resolution, the port accepts more responsibility for their financial decisions.
The caveat to this being a real success story is the economy improving, and the port refraining from any further borrowing. A healthier economy would raise interest rates, and being locked into a low rate brings an added advantage to the finances of the port.
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