Florida Governmental Utility Authority Refinance Saves Customers $7.5 Million
Through smart, strategic financing decisions, the Florida Governmental Utility Authority (FGUA) has improved credit ratings and saved customers More than $7.5 million in interest payment on bonds for two of its systems. The details of this extraordinary accomplishment were presented to the FGUA Board of Directors at their December meeting Dec 13.
In November 2012, utility bonds for the Lehigh Acres (Lee County) and Golden Gate (Collier County) systems were refinanced by the FGUA.
Golden Gate customers will save approximately $3.2 million. Refinancing the existing bonds at a 3.16 percent interest rate resulted in a savings of $240,000 annually in interest payments. The Golden Gate Series 1999 Bonds had an interest rate of 5.02 percent. The transaction also resulted in an improved “A” rating with a stable outlook.
The savings to Lehigh Ares customers is even greater. Lehigh Acres customers will save approximately $4.4 million. This is an annual savings of $280,000. The Lehigh Acres System Series 2003 bonds had an average interest of 5.10 percent. The refinanced bonds had a 3.48 interest rate. The refinancing also resulted in the removal of a negative outlook for the system.
The refinancing received very strong, favorable comments from rating agencies. This is important because favorable ratings result in lower interest rates and therefore lower costs for customers.
“We are constantly looking for ways to improve the systems and manage costs while delivering quality service to our customers,” said Robert Sheets, System Manager. “This refinancing provided a great outcome for our customers. Our next steps will include a presentation to our board regarding alternatives for sharing these savings with our customers. Clearly, it’s our pleasure to do so.”
The Florida Governmental Utility Authority is comprised of member governments with common interests and responsibilities to acquire, own, improve, operate and maintain water and wastewater facilities for the benefit of local management and lower costs. The Florida Governmental Utility Authority provides services to approximately 90,000 Floridians every day.