$1.9 million savings to seed strategic investment fund
Brian Coddington, Communications Director, 509.625.6740
Monday, January 11, 2016 at 12:17 p.m.
The City of Spokane announced today plans to refinance bonds that were sold as part of a settlement related to the River Park Square parking garage.
Refinancing will save the City and its citizens about $190,000 a year in payments over 10 years. Mayor David Condon and the City Council plan to use the savings to develop a strategic investment fund that would support economic development.
“This makes better use of public money by investing it in economic development in Spokane instead of larger interest payments,” Condon said. “Our vision is for Spokane to be the fastest growing job market in the Inland Northwest and this helps us get there.”
“Establishing a strategic investment fund for economic development with this savings is the right thing to do for our citizens,” said Ben Stuckart, City Council president. “We need to invest in our economic future by putting money where it will pay us back with jobs and economic growth.”
Details of the fund must be defined through Council action, but the goal is to fund public improvements that will help bring in new businesses or grow existing ones. The City will refinance the bonds with a loan with U.S. Bank for about $16.4 million. The interest rate for the new loan will be 3.24 percent, down from the 5 percent interest rate on the old bonds.
Term of the loan will be 10 years, with the loan paying off about two years earlier than the original bond. The loan includes a balloon payment in year 10, which will be repaid for parking meter revenues. That’s the same source of repayment as the original bonds.