HARKER HEIGHTS — The Harker Heights City Council on Tuesday clinched a lower-than-projected interest rate on a $9 million bond that will help fund construction of several city improvements, possibly within the year.
The council accepted an interest rate of 2.99 percent for a $9 million, 20-year loan to chiefly fund infrastructure improvements.
The rate “is about $1.3 million better than budgeted, or $65,000 per year,” said Garry Kimball, with Specialized Public Finance, the city’s financial adviser.
However, the 20-year note still will cost residents about $3.6 million in interest payments during the payoff period.
Money from the loan is being committed to at least 16 projects. Among them are widening and adding a left-turn lane and signal lights on Stillhouse Lake Road, reconstructing Comanche Gap Road and Amy and Pecan drives, upgrading the Cedar Knob pump station and Warrior’s Path lift station, and renovations to an expansion of City Hall.
The city hopes to have some of the projects started within the year, said Mark Hyde, the city’s public works director.
“We are in the process of getting cost estimates and revising (our current) estimates,” Hyde said, noting some projects still need engineering work.
Kimball originally estimated the city would receive a 4.25 percent interest rate, but several factors played into getting the lower amount, he said.
The city’s bond rating was reaffirmed and determined stable, and there are significantly fewer bonds on the market than a year ago.
Heights’ loan received 11 bids.
“That is pretty much everyone in the game,” Kimball said. “I haven’t seen a 20-year deal break through 3 percent in about nine months.”
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