City Eyes Lower Interest Rates

By Bruce Kettelle

Trotwood leaders are eyeing lower interest rates to convert most of the city’s debt into long-term notes.
During most of the past decade Trotwood has used short-term one-year notes to finance the city’s investments.

“This was a conscious strategy to wait,” said Jeff Rink of Key Bank, the city’s bond advisor. Rink presented the case at the March 1 city council meeting. He said the time is close to convert the debt into long-term bond notes.

Rink said the short-term rates have been very favorable but things look like they are beginning to change. He expects the city to qualify for a rate around 5%.

Acting city finance director Patricia Shively said the city would combine several existing debts into one for six months to give the bank time to arrange the long-term package. The components include $3.8-million for the Salem Mall acquisition, $2.5-million for the Toys-R-Us acquisition, $1.7-million for improvements along Olive Road for the GM distribution facility, and $100,000 for the East Main St water line replacement.

The city council voted unanimously to issue the 6-month bond anticipation note for $8,255,000.
Rush said he would prepare by August a 20-25 year bond package for the funds. He expects the city will attract favorable rates.

Council member Mary McDonald asked Rush if it would be difficult to find someone to purchase the city’s bonds. He said, “Cities as fine as Trotwood are having no trouble selling their debt.”