(Spirit Lake)– The Dickinson county board of supervisors Thursday awarded a bid on the issuance of 10 million dollars in general obligation bonds for the courthouse project. The bid was awarded to RBC Dain Rauscher of Chicago with the lowest interest rate of 4.29 percent a year over the 20 year life of the bonds.
Seven firms submitted bids.
Tim Oswald of U-S Bancorp Piper Jaffray is assisting the county in the bonding process. He told KUOO news the 4.29 percent interest rate came in lower than the four and-a-half percent rate used in informational flyers prior to the bond issue election.
Oswald says that will translate into a savings of about 500-thousand dollars in interest costs over the life of the issue.
A bid will be awarded on the remaining 4.9 million in G-O bonds after the first of the year.
Oswald says the issue was split to take advantage of a tax exemption that exists under federal law for those that borrow 10 million or less during a calendar year. He says that’s important since banks pass that tax exemption along to the county in the form of lower interest rates.
Oswald says a contributing factor to the lower-than-expected interest rate in the bid awarded Thursday is the county’s excellent A1 bond rating from Moody’s Investors Service. Oswald says a rating that good is unheard of among rural Iowa counties.
