News From Terre Haute, Indiana

March 7, 2013

Officials look at refunding Juvenile Center bonds

Howard Greninger
The Tribune-Star

TERRE HAUTE — The Vigo County Building Corporation will stage a public hearing at 8:30 a.m. Friday at the Vigo County Annex to discuss refunding bonds issued to build the Vigo County Juvenile Center.

The county issued $3.2 million in bonds in 2002, however those bonds are now callable, said Vigo County attorney Michael Wright.

A study from Piper Jaffray, an investment bank and asset management firm, which has an Indianapolis branch office, shows the county could save $105,000 with lower interest payments through 2021.

The callable amount is $1.575 million. The county building corporation could decide Friday to call the bonds and pay them off. “We are able to do a private placement which forgoes the usual [bond] process …,” Wright said.

The current bonds have an interest rate of 4.4 percent this year, increasing each year until reaching 5 percent in 2021. Piper Jaffray is estimating a new finance interest rate of 1.9 percent, which includes closing costs on the bonds.

The 3-member building corporation will decide Friday whether or not to call the bonds. If bonds are called, the building corporation would adopt a resolution for that sale. The Vigo County Council and the Vigo County Board of Commissioners would then have to adopt a joint resolution at the council’s March 12 meeting, Wright said.

Once sold, the county would conduct a “pricing call,” with bids likely submitted from area financial institutions. Commissioners would then select the most appropriate bid, Wright said.

Reporter Howard Greninger can be reached at 812-231-4204 or howard.