Taking advantage of current low interest rates, the Brookfield Village Board voted unanimously Monday evening to refinance nearly half of its long-term debt. This fall, the village plans to call and pay off approximately $5.3 million of two series of 20-year general obligation bonds that it sold in 2006. To raise the money to pay off the existing bonds, the village will sell new 10-year bonds. The lower rates on the new bonds is projected to save the village about $246,000 over 10 years.
“It’s not a tremendous amount of money,” said Village President Kit Ketchmark. “We’re talking about $25,000 a year, but there is a cost savings there. This isn’t exciting, but we’re just trying to be as careful as we can with the residents’ money, and over the course of 10 years, we end up saving almost a quarter million dollars.”
The money was originally borrowed to pay for street projects. The revenue backing the bonds is water and sewer taxes for one series of bonds and sales tax revenue for the other bond series.
The bonds are expected to be sold sometime this fall. The board hired the Chicago-based firm of Bernardi Securities to act as the underwriter of the new bonds. Bernardi will be paid out of the bond proceeds at a rate not to exceed 0.80 percent of the par value of the bonds it sells. The board hired the law firm of Chapman and Cutler to act as bond counsel.
The village currently has about $10.8 million in long-term debt according to finance director Doug Cooper. The refinancing is not expected to affect residents’ tax bills.