A recent restructuring of debt through the re-funding of $14.6 million in bonds issued in 2005 will save East Hampton Town $3.3 million over the nine-year life of the bonds.
Richard Tortora of Capital Markets Advisors, a financial advisor to the town, and Len Bernard, the town budget officer, said in a joint release this week that the recent offering drew “an extraordinary amount of investor interest,” from 11 different banks and securities firms. In addition to providing a low 1.8-percent interest rate, the winning bidder, Jefferies, a Manhattan limited liability corporation, will pay the town a $2.26 million premium to purchase the bonds.
The premium will be used to reduce the value of the bonds to be issued to $12.45 million, helping to lower the town’s overall long-term indebtedness.
Mr. Bernard said the demand for East Hampton’s bonds “portends well for the future, seeing that one thing that rating agencies like Moody’s look for in evaluating our credit is the demand for our debt.”
An analysis by Moody’s prior to the sale “showed its continued faith in town management,” said Mr. Bernard, promising that the new administration will continue to improve the town’s financial condition.
“Len Bernard and the finance team deserve credit for their outstanding work improving the town’s financial standing,” Town Supervisor Larry Cantwell said in the release.