County Board of Commissioners voted last week on a
refinancing deal that will save the county nearly $40,000
per year between now and the middle of 2020, when the Nash
Farm property is paid off.
agreement with the current lender, De Lage Landen Public
Finance LLC, will see the interest rate on the installment
sale agreement drop from its current 4.42 percent to 2.75
percent effective Nov. 1, when the first payment under the
new rate is due.
means a reduction of about $3,327 from the current monthly
payment of $73,577.84 under the original agreement, which
began July 1, 2008 and runs through June 1 2020. That comes
out to $39,927 per year, and the total savings over 68
months will amount to $226,258.04.
refinancing does not change the amortization schedule, a
fact that District II Commissioner Brian Preston reiterated
after county finance director Fred Auletta’s presentation of
than have the life of the loan extended as often happens
when a 15-year or 30-year home loan is refinanced, in this
case the loan will be paid off at the same time as
originally planned, Preston pointed out.
said his office looked at another proposal which would have
kept the monthly payments the same but ended the payment
schedule a couple of years earlier. He recommended the lower
payment which would put money back into the county’s coffers
acquiring the 192-acre Nash Farm property, the county sold
it to the Association of County Commissioners Georgia (ACCG)
in May of 2008 for $8,208,200. The ACCG then sold it back to
the county and assigned the ISA to DLL as the lender.
county approached DLL recently about possible refinancing
options, Auletta said, and DLL came back with the
will be no fees or expenses to the county from the
refinancing, but the county will be responsible for its own
legal/advisor fees, according to Auletta, who added that the
county’s bond counsel expects those costs to be below
receiving the DLL proposal, the county gave two local banks
– Heritage and United Community – the opportunity to compete
for the business, along with SunTrust, the county’s current
Heritage nor United Community has an “appetite for
tax-exempt lending,” said Auletta. Heritage offered a
4.35-percent rate while United Community’s proposal was 3.42
percent, both of which were far above DLL’s new rate.
came up with a 1.79-percent offer that would have saved
another $127,100 but could not complete the same financing
agreement, so the bank proposed that the Henry County
Develop-ment Authority be the borrower supported by an
intergovernmental contract. The main difference is that this
loan would be come with a full faith and credit pledge of
the county, whereas the DLL agreement is only collateralized
by the land itself.
said that, according to the county’s bond counsel, this
financing would not be appropriate because of the “unique
constitutional and statutory provisions that limit the
projects and parties that it may provide financing for.”
spent the last couple of weeks trying to come up with
another plan but could not, Auletta added.
staff recommended the DLL proposal and that it be ready to
close by Oct. 1, with formal acceptance no later than Sept.
21 to meet the 60-day condition of acceptance before DLL’s
July 24 offer becomes null and void.
The proposal was approved