Market conditions are considered ripe for Gahanna to take advantage of low-interest rates, so Gahanna City Council is considering a measure to refinance bonds and issue new municipal bonds to finance street improvements.

Market conditions are considered ripe for Gahanna to take advantage of low-interest rates, so Gahanna City Council is considering a measure to refinance bonds and issue new municipal bonds to finance street improvements.

City finance director Jennifer Teal said the administration is recommending the city issue municipal bonds to complete one-third of the city's remaining Detroit-style streets. That style of street originally was all concrete pavement and wasn't designed for the addition of an asphalt surface.

As funds became limited to properly repair the concrete street, that style of street began receiving a thin asphalt overlay, creating problems with drainage.

The city rebuilds them to current standards, including an asphalt surface, concrete base and separate curb and gutter.

Teal said she anticipates a three-year construction program involving the streets.

She said those bonds would be issued in conjunction with an advanced refunding of the city's remaining 2005 bonds that were not included in a 2013 refunding, as well as the bulk of 2007 outstanding bonds.

The city's financial adviser Brad Sprague, of PRISM Municipal Advisors LLC, reviewed the proposed general-obligation bond issue during the March 23 council committee meeting.

Sprague said the deal would consist of two basics: raising new money for street projects and refinancing portions of two series of bonds issued in 2005 and 2007.

He said the street-improvements component, raising $5,150,000, would include bonds expected to mature in 2015-2034, with an average annual debt service of about $365,000. The interest cost would be about 3.25 percent.

The 2005 bonds include a refunding of up to $1,035,000, with bonds maturing in 2016 and 2017.

The 2007 bonds would refund up to $6,970,000, with bonds maturing from 2018-2027.

Sprague said the savings earned over the life of the new bonds from refinancing would be about $620,000.

"This is called an advanced refunding," he said. "If you refinance an issue prior to the call date of bonds, it's advanced. According to general practice, if you can't save 3 percent by refinancing, you should probably wait.

"The federal government decided you can only refinance only once during their life, so you want to make sure it's worth taking advantage."This would be a 6.9-percent savings."

Mayor Becky Stinchcomb said quality streets are one of the basics the city provides.

"I think when we look back to our priorities, streets are one of the basic things we do," she said. "It's a fundamental responsibility we do. There are a lot of things we'd like to have. What's essential to local government is the quality of the streets. It can't be underemphasized. It's a definite concern and an essential responsibility we have."

A first reading for the bond-related legislation is scheduled for April 6. Council may discuss the proposal further during the April 13 committee meeting.

If approved, Teal said, "we wouldn't sit around. We would pull the trigger quickly."

She said city administrators would prefer to get the deal completed and in the books by Memorial Day.