Kent County board may back airport bonds

February 9, 2009
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County commissioners could purchase another piece of property for the Fuller Avenue Campus this week and also authorize a bond issuance for the Gerald R. Ford International Airport on Thursday, if commissioners follow the recommendations laid out by the county’s Finance Committee last week.

The bond issue can’t exceed $34 million and would redeem a 1995 series that was worth $40 million back then. Those bonds financed improvements to the airport’s runways. The new bonds would carry the county’s triple-A rating, a mark the county didn’t have in 1995.

“In today’s municipal bond market, there is no market unless you have triple-A,” said GFIA Executive Director James Koslosky, who added that other airports with a lower bond rating haven’t been able to secure financing from the market.

“We’re looking at $200,000 in savings per year on our bonds,” he said.

County Fiscal Services Director Robert White said the new bonds would generate a gross interest-rate savings of roughly $3 million over the securities’ remaining life. He estimated the net “present value” savings at $2.4 million, or 7.6 percent of the bonds being refunded.

The new bonds are expected to offer buyers a tax-free interest rate of no more than 5.5 percent. Pricing is expected to happen late next month, and it’s hoped the securities will go to market in mid-April. The bonds will be sold in denominations of $5,000.

The county has an opportunity to buy property at 1230 Bradford NE for $125,000 plus closing costs estimated at $1,500. The parcel is adjacent to the Fuller Avenue Campus, which the county is upgrading.

County Administrator and Controller Daryl Delabbio said Network 180, the county’s designated substance abuse counselor, will contribute $14,580 toward the purchase.

“They will benefit from it,” said Delabbio.

Network 180 is expanding its location on the Fuller campus and has contributed to another property purchase the county made. The county’s share of the purchase price, $111,920, will come from its capital improvements fund.

County Assistant Administrator Mary Swanson said there are two more properties the county is looking to purchase near its northeast side campus.

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