City of East Providence prices first financing for $189.5M high school
East Providence, RI – The city of East Providence has locked in an attractive 1.5 percent interest rate on the initial short-term borrowing for the City’s new $189.5 million high school. The first financing is a Bond Anticipation Note for $78 million that will mature in 17 months. The BAN provides financing for the first phase of construction. At the time the Bond Anticipation Note matures, the City plans to issue the long-term bonds to permanently finance the new high school complex. The 1.5 percent rate is below the City’s initial October 2019 projection, saving more than $1.5 million in interest costs.
“We continue our efforts to be as cost-effective as possible,” Mayor Bob DaSilva said. “After a request for proposal process we directly placed this financing with Bank of America.
“Not only did we accomplish a low rate, but we saved an estimated $50,000 on transaction fees.”
The City, together with Shechtman Halperin Savage LLP (bond counsel) and Hilltop Securities Inc. (municipal adviser), has been working on the overall high school financing plan for nearly a year.
“Our team has considered a number of scenarios, made projections and met with the Rhode Island Department of Education and the Rhode Island Infrastructure Bank in order to be as efficient as possible and lock in the lowest cost of borrowing for our citizens,” DaSilva added.
The transaction is expected to close on Jan. 21, 2020. The next financing to provide for continued funding for the project is scheduled for January 2021.