Mayor Cooper announces plans to refinance Metro Nashville debt

NASHVILLE, Tenn. (WTVF) — To take advantage of currently low interest rates, the Metro Nashville government plans to refinance debt in an effort to save taxpayers’ money, Mayor Cooper’s office announced Thursday.

This strategy will materialize through two refinancing actions.

First, the Metro Finance Office and Mayor Cooper’s office will file a Metro Board resolution on Friday to authorize the refinancing of $629 million in general obligation bonds. This plan was approved by the Tennessee comptroller earlier this week.

According to Mayor Cooper’s office, this refinancing plan is expected to save Davidson County taxpayers more than $44 million over the next 20 years.

“Hard-working families in Nashville need to manage their budgets responsibly, and we need to do the same in the metropolitan government,” Mayor Cooper said. “Just as any resident would seek the best terms available for a mortgage or auto loan, my job is to make sure the ratepayers of Nashville get the best deal possible.”

In recent years, debt service costs have become a larger part of Nashville’s overall operating budget. This refinancing plan will help the metropolitan government prioritize other city needs, including schools and emergency response. It will also create an investment opportunity in neighborhood infrastructure.

Mayor Cooper’s office also plans to file the second refinancing resolution on Friday. This resolution will authorize the refinancing of $650 million of short-term debt commercial paper into long-term, low-interest general purpose bonds.

Nashville could reach its $700 million commercial paper cap in early 2021. With this resolution, the Nashville government would have restored access to commercial paper, providing flexibility and the ability to resume previously allowed capital expenditures . These projects include non-emergency repairs to sidewalks and roads, as well as planned projects for schools, libraries, bike paths and community centers.

Non-essential capital spending was frozen in the spring due to the impact of COVID-19 on Nashville’s revenue. This freeze will remain in effect until both refinancing resolutions are completed.

Mayor Cooper will introduce the next annual capital spending plan for Nashville in early 2021. Mayor Cooper’s office says this will address deferred maintenance needs and an initial round of projects in Nashville’s transportation plan.

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