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Bond refinancing to save Emerald PUD $3 million

From the July 22, 2013 issue of Public Power Daily

Originally published July 22, 2013

The Emerald People’s Utility District in Eugene, Ore., executed a $34.28 million refinancing bond sale of Electric System Revenue Bonds on July 9 that the utility said will generate $3 million in savings for customers over the next 13 years. The bond refinancing was completed to take advantage of currently low interest rates and to secure cheaper financing of existing Emerald PUD debt.

As part of the sale, the Emerald PUD’s A1 rating was reaffirmed by Moody’s Investors Service in June. Several key factors for the rating were cited, including the utility’s declining debt burden and the stability of the Eugene metro area economy.

"Refinancing at a lower interest rate means we will pay less on our debt each year" said Chief Financial Officer Tiffany Collier. "The utility will see an annual savings of over $330,000 in the first nine years."

The new bonds will mature between 2014 and 2026. Emerald PUD sold the bonds at borrowing rates between 2 percent and 5 percent, less than the previous rates held on the 2003 and 2006 bond series.

"The reaffirmation of the A1 rating is a testament to the hard work of the Emerald PUD board, staff and community," said Katherine Schacht, Emerald PUD board treasurer. "We are very pleased with the outcome of the bond sale and the savings we were able to capture for our customer-owners."

Emerald said it is on track to be debt-free in 2026.


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