Sherman recently approved a measure to refinance several outstanding bonds, while also issuing new bonds for water projects.
The series of bonds will be issued through the Greater Texoma Utility Authority and include $5.8 million of new debt while simultaneously refinancing four older bonds from 2008 and 2009. GTUA General Manager Drew Satterwhite said new bonds would allow Sherman to pursue some water projects while the refinancing would save the city approximately $274,000.
The bulk of the package was $5,815,000 worth of new bonds set to be used toward new projects, including sewer construction and water line improvements.
The projects included three related to work at the city’s wastewater treatment plant along with sewer pipe work near First Street and Rosedale, among others. A new sewer line will also be constructed along Moore Street as part of the city’s five-year list of capital improvements.
Sherman Director of Utilities Mark Gibson said many of the projects are slated to see work begin within the next year.
One project Satterwhite talked about was the Lake Texoma Pump Station’s cathodic protection improvements, which would finish Sherman’s two-year project to add cathodic protection to a 72-inch water line that goes from Lake Texoma to Howe.
Satterwhite said typically it would have been two separate bond measures. However, the cost of the packages and the opportunity to save the city money on refinancing led to the recommendation to make it a single issue, he said.
Satterwhite said the projects in question were all of a scope that would not make them worth the city’s time going to the development board, thus he was recommending GTUA to approve the bonds, which was also done by the council Monday evening.
The bonds in question to be refinanced are a pair of bonds from 2008 and a pair from 2009. Satterwhite said GTUA’s financial advisor Garry Kimball had identified these bonds as prime for refinance. He said the goal is to save at least 3 percent on the outstanding principal before it makes sense to refinance and the bonds the city was looking at met that test with a 3.76 percent savings.
Satterwhite said the bonds currently have an average interest rate of 3.59 percent. He said the goal is to get them closer to 2.6 percent, which he believed was possible.
“We would save the city of Sherman $274,000 over the final 11 years of those notes,” Satterwhite said. “It seems like a fairly obvious action to perform, in my opinion. What we are asking for is to combine these into one bond issue.”
Herald Democrat reporter Michael Hutchins contributed to this article. Richard A. Todd is a reporter for the Herald Democrat. Contact him at firstname.lastname@example.org.