ALPENA - The Alpena Regional Medical Center Board of Trustees unanimously voted to refinance the 1999-2000 general obligation bond resolution at a cost not to exceed $7 million with continuing disclosure during its Tuesday meeting. The two resolutions were advised by John Axe of Axe & Ecklund of Grosse Pointe Farms, who was involved in the bond council when it was originally issued.
"What you're doing here is nothing different, it's like refinancing a house," Axe said. "Interest rates are so low right now. My guess would be interest rates will remain on the floor for a long time, I don't think they will go back up any time soon."
Under Axe's advisement the board approved refinancing the 1999-2000 general obligation bond resolution in order to save money on interest costs.
"Net savings spread over a number of years, until 2019 will total an estimated $570,000 in savings. We'll know the actual number after we receive bids on bonds in September," Axe said.
George Smart, vice president for finance and information systems, said the 1999 bonds were at an interest rate of 4.875 percent and the 2000 bonds were set at 5.2 percent, but the new refinancing rate is expected to be as low as 2 percent and will generate savings over time.
"At this point it's important to be prudent and look for opportunities to decrease our overall costs," Smart said.
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