West Windsor is taking advantage of historically low interest rates to refinance $8.1 million of bond debt. The sum is composed of outstanding bonds the township issued in 2007 and 2009, and the refunding is expected to ultimately save the township more than a quarter million dollars. Council approved the refunding ordinance at the Aug. 29 meeting.
“The bonds were very low, at the time they were issued the rate was 3.6 percent,” said township financial advisor Sherry Tracey. “But now we’re in a place where they’ve come even lower.”
Bond counsel Ed McManimon said the town could get rates as low as 1 to 1.5 percent.
The process of refunding the $8.125 million in existing bonds through private securities companies is expected to cost half a million dollars, but the administration projects net savings of $257,000.
To repay the outstanding 2007 and 2009 bonds, the township will issue new bonds that will be paid back at a lower rate. The funds from this refunding will be used to pay off $3.55 million in bonds from 2007, which are eligible for redemption. However, the $4.5 million in bonds from 2009 do not have a “call option” until 2019. In the interim, the township will place the surplus money in ultra-safe state and local government securities with interest rates yields under 1 percent.
The refunding will be part of an additional issuance of $16.53 million in new bonds, which includes existing short-term obligations and previously approved bond ordinances.
The new bonds are for capital projects from as early as 2010, including road programs, park improvements and vehicle and equipment purchases. The overall $25 million issuance this fall will be the township’s first long term bond sale since 2011.
Tracey said West Windsor’s AAA bond rating will aid with the issuance, noting that every rating level trades has a five to 10 basis point differential in interest rate. (One basis point is one hundredth of one percent.)
Total municipal debt service has remained constant the past few years at $5.56 million, or roughly 15 percent of the annual municipal budget.
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West Windsor council will hold a special meeting on Thursday, Sept. 22 to discuss the redesign and repaving of Canal Pointe Boulevard. The meeting starts at 7:15 p.m.
The last to-do item is the awarding of a construction contract, but the project has been caught up in mayor-council rancor. The administration is seeking to redesign the pockmarked four-lane roadway into a two-lane road with one center turn lane and bike lanes on each side, but council members Linda Geevers, Hemant Marathe and Peter Mendonez have expressed a preference to repave the road and maintain the current lane configuration.
Mayor Shing-Fu Hsueh and township planning officials, meanwhile, argue that the traffic calming efforts are consistent with the township’s long-term goal for the roadway to make the road safer for residential communities off Canal Pointe Boulevard.
Under West Windsor’s mayor-council form of government, council cannot directly determine the roadway design. However, the award of a bid for the construction contract requires council approval.
Council President Linda Geevers said no action will be taken at the Sept. 22 meeting, which is a special work session to discuss the project.
Hsueh said the engineering department is preparing requests for proposals for the project. He said that the goal is to finish construction before the end of the year.
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The general public can now rent the Schenck Farmstead for one-day events at a bargain rate: $100. The township decided to reduce prices dramatically after seeing little demand.
Weddings were previously $850 and corporate events were $500. Now any social event costs $100, plus a $150 security deposit. An event tent can be erected on the property, which features restrooms and has a 50 person maximum.
