By JB Clark/NEMS Daily Journal
GUNTOWN – Future Guntown taxpayers will see less of their tax money going toward paying off debt thanks to a loan refinance.
The town has four long-term loans for general infrastructure improvements totaling $1,836,007.83 that date back to 1992 and don’t expire until 2040. The interest on the loans range from 4.25 percent to 5.5 percent.
“We got word the other day that by refinancing, it will save the town $268,649.16 over the lifetime of the debts,” said Mayor Robert Herring, who is retiring this year. “I was going over the town’s financial situation to see how we stand because I wanted to make sure I’m leaving it in good shape.”
Instead of adjusting the city’s yearly debt payment, Herring said they will continue to pay $91,934.83 each year and absolve their debt obligation seven years early.
“This will be something worth a lot to this town by taking seven years off and give them more flexibility,” he said. “They can maybe buy something they need or just have some extra money. It worked, and I’m quite proud of it.”
The yearly debt payment is about 6 percent of the city’s annual budget.
Herring said the debt consolidation and reduction will help the city, especially if it continues expanding at the current rate because infrastructure upgrades will be needed. So far in 2013, 28 residential building permits have been written.