Friday, October 18, 2019

NorCo Council Votes To Refi $61M in Debt, Expects $3.2M Savings

Northampton County Council voted 6-1 last night to approve up to $75 million in bonds to refinance about $61 million in debt. The sole No vote came from Peg Ferraro (by phone). Voting Yes were Council members Ron Heckman, Bob Werner, John Cusick, Matt Dietz, Tara Zrinski and Kevin Lott (by phone). Council members Bill McGee and Lori Vargo-Heffner were absent.

This debt is from a bond series with a call date in 2022. The current interest rate is around 4.81%. Under changes to our tax law, it is impossible to refund (refinance) them with tax exempt bonds until the call date. But they can be refunded with taxable bonds. If it is done at an interest rate under three per cent, the County would save $3.2 million. Alternatively, the County could wait until the call date and save more or less, depending on the interest rate.

By approving the refinancing last night, County Council has given financial adviser Scott Shearer the authority to pull the trigger if he can save the county $3.2 million.

There was some confusion among Council members about a $75 million issuance to refinance $61 million in debt. Shearer explained the refinancing would have to include the interest, which would increase the debt to about $67 million. He has no expectation of issuing $75 million in bonds.

He added the only purpose of this new bond is to refinance existing debt. There will be no new money.

In other business, County Council introduced an ordinance to condemn 150 South Union Street in Easton. This is adjacent to the county campus and is for a handicap-accessible parking lot to service the courthouse and jail. Interestingly, this property was just purchased in February September by Sunblest Holdings, LLC, and at a Sheriff's Sale, for $33,045.00.

As the meeting ended, Council President Ron Heckman announced that Vargo-Heffner was absent because her father passed away the previous day.He asked everyone to keep her and her family in their thoughts.

25 comments:

Anonymous said...

Ids this a way to pad the county coffers?

Anonymous said...

Here we go again. ANOTHER "SWAPTION" scandal for Northampton County?

Anonymous said...

Bernie any idea why Peg voted no?

And Sam, please go away.

Bernie O'Hare said...

I have no idea why Peg voted No. She participated by phone so I had no opportunity to ask her. But I was bothered by the lack of attention to the details of the actual ordinance. It required five amendments. The biggest of these - the requirement that there be a savings of three per cent - was completely missing. This omission was picked up by John Cusick, not the bond counselor financial advisor. That is their job. They failed.

I am told these errors are because of our Council Clerk, and I have seen her make errors before. But the ultimate responsibility for this is the bond counsel and administration. It was too sloppy for a major deal and I would have tabled the matter. It was hardly reassuring.

As far as the merits of it are concerned, the downside is that the county might save much more than three per cent by simply waiting. But it might not. This issuance gives the county a bird in the hand vs. two in the bush. But there is no risk like here was with the swaption.

Anonymous said...

What is it with this county and city and parking lots? Continuously taking property off the tax rolls in order to make parking. I've gone to the court house easily twice a week for my job for the past 12 years. Yes, you may have to walk a block but never had a problem finding a space. As for handicapped parking for the prison, why couldn't they just make some of the metered spots out front of the door handicapped parking? Seems a lot cheaper and easier of a solution. I guess when you're wasting other people's money, it doesn't matter.

Bernie O'Hare said...

Parking at the courthouse is a challenge. That is the reality. You may have to walk several blocks, and uphill. It is no waste of money to provide access to the people's building.

Anonymous said...

Smart move taking more properties off the tax rolls for parking. Before long Easton will be one large tax exempt parking lot for LAFAYETTE COLLEGE. Must be following Sal's lead in taking properties off the rolls. Brilliant !

Anonymous said...

The new lot the county is creating is already off the tax rolls and has been over 10 years. Get the facts straight.

Anonymous said...

"Interestingly, this property was just purchased in February by Sunblest Holdings, LLC, and at a Sheriff's Sale, for $33,045.00."

This is interesting.

Anonymous said...

Bernie, I must have missed it in the opening paragraphs of this thread, but who is Shearer? And at least Cusick caught the error. Still not reassuring. Thanks!

Anonymous said...

County has crazy amounts of parking on Union St, why do they want a half double. That's like 4 parking spots. Who advises the County on this stuff?

Anonymous said...

How does a blind voter vote?

Anonymous said...

"I am told these errors are because of our Council Clerk" and "but the ultimate responsibility for this is the bond counsel and administration". Which is it? You can't have it both ways or are you just trying to smear the Council Clerk again because you can't stand the fact that she earned this position through hard work and not being a political crony?

Bernie O'Hare said...

I think I was clear. I made no attempt to have it both ways. The ultimate responsibility for the accuracy of this proposed ordinance rests with the administration, the county financial advisor and its bond counsel.

Bernie O'Hare said...

"Bernie, I must have missed it in the opening paragraphs of this thread, but who is Shearer? And at least Cusick caught the error. Still not reassuring. Thanks!"

I should have been more clear. Scott Shearer is the county's financial adviser

Bernie O'Hare said...

"How does a blind voter vote?"

It shows you on the video

Bernie O'Hare said...

" you can't stand the fact that she earned this position through hard work and not being a political crony?"

She is a very good administrative assistant. She worked very hard in that role.

Anonymous said...

BERNIE, 150 S Union St was purchased by Sunblast 3 weeks ago. Stop publishing #FakeNews.

Bernie O'Hare said...

I stand corrected. I must have read it wrong. I find this quite strange bc the county could have bid in the property had it wanted it.

Anonymous said...

Why would the County pay for it when they can have some sucker buy it and take it from them for free. McClure is much smarter than the previous executive.

Bernie O'Hare said...

A condemnation will cost much more than it would to have bought at a Sheriff Sale.

Bernie O'Hare said...

As I reflect on this, it may be improper for a county to participate in a sheriff Sale it conducts

Anonymous said...

"She is a very good administrative assistant. She worked very hard in that role."

Obviously another snide slam on this woman. You attack her because you have been fed misinformation by the Admisntration whom tried to have her fired. Yet you are just fine with a clerical tech being called the executive administrative assistant being paid and getting raises our of class. You claim to help employees. You may help a few, that you like

Anonymous said...

The County Council Clerk gets paid WAY TOO MUCH of TAXPAYER dollars for her position. THAT NEEDS TO BE DEALT WITH. There are always errors in things coming from the office. Those positions get paid more than typical County payscale. Why? Check it out. Also, the Clerical Tech/Specialist that needed a job so she had medical benefits because didn't win her political run is TOTALLY A POLITICAL PAY. Please report back on her title and pay changes since her hire date. McClure needs to go!!!! Wasting taxpayer money!!!! Corruption at its finest. No better than Brown and possibly worse.

Anonymous said...

Blogger Bernie O'Hare said...
"As I reflect on this, it may be improper for a county to participate in a sheriff Sale it conducts"

Bank purchased at Sheriff Sale in January or February. Bank owned foreclosure sale took place in August.

...and you do title searches?