Debt refinancing to save nearly $800,000
After refinancing current debt over the past few years, the city is now in position to save nearly $800,000 in annual debt service.
"Interest rates have dropped, so it was in our favor [to refinance], Finance Director Bragg Farmer said.
The debts include the Town Center CRA, the Harbor CRA, a city-issued debt in 2002 and a second city-issued debt in 2005.
The town center debt was issued in 2005 and refinanced in 2014 saving $340,000 and restructured in 2015 saving an additional $257,000 annually. Projects in the town center included Main Street and Airport Road improvements.
The harbor debt was issued in 2009 and refinanced in 2015 saving the city $45,000 annually. Projects in the Harbor CRA included Mountain Drive improvements, construction of the harbor boardwalk, construction of the Marler Street parking lot and purchase of the Capt. Royal Melvin Heritage Park property.
The city-issued debt in 2002 was used for replacing the harbor pump, a new stormwater and floodplain management plan, and new sidewalks near Destin Elementary School. The debt was refinanced in 2013, saving $107,000 annually.
The 2005 city issued debt funded various recreation projects as well as public facilities maintenance and capital projects. The debt was refinanced in 2005 and equates to $50,000 in annual savings.
Looking at the current landscape, Farmer told The Log the Harbor CRA debt should be paid off by 2029, the 2002 city-issued debt by 2031 and the 2005 city-issued debt by 2029.
"In only 16 years, of our current debt, three of these will be paid off," he said. "That's pretty exciting."
As for the Town Center CRA debt, it should be paid off by 2036.
The savings from refinancing should benefit the city as a whole, Farmer said.
"This is going to allow us to step up and do some of the capital projects we have lined up," he said.