Like a family refinancing its home mortgage, Upper Arlington officials are looking to take advantage of a user-friendly bond market.

Like a family refinancing its home mortgage, Upper Arlington officials are looking to take advantage of a user-friendly bond market.

Upper Arlington City Council voted unanimously Sept. 26 to approve an ordinance authorizing staff to refinance some of the city’s general obligation bonds to take advantage of the market. Savings to the city are estimated to be more than $400,000, according to finance director Catherine Armstrong.

“Currently, rates in the municipal bond market are very low,” Armstrong told council in her report. “This provides an opportunity for the city to refinance the current bonds with a lower interest rate.”

In 2003, Upper Arlington issued $10 million in general obligation bonds as part of the city’s ongoing capital improvement program, according to Armstrong. From that original $10 million, $7.285 million is still outstanding, with $5.8 million available to be refinanced for savings.

Patrick King, first vice president, public finance at Stifel Nicolaus, presented council members with the figures regarding the refinancing. King said that typically when municipalities investigate refinancing their debt, a savings of at least 3 percent is recommended before moving forward.

“The city’s savings would be about 7.5 percent — way beyond the industry threshold,” King said. “Municipalities all over the country, and all over Ohio, are seeing this opportunity as well. We want to get in and get out as soon as possible, to be in the market before the demand goes away.”

Armstrong said that members of the city staff, including incoming city manager Ted Staton, will be in Chicago on Oct. 19 to make presentations on the refinancing for the city’s bond rating agency.

The full text of the ordinance can be viewed on Upper Arlington’s website, www.uaoh.net.