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Pleasant Prairie to Refinance Nearly $2,635,000 in General Obligation Bonds for TID #2
On Monday, October 1, 2012 the Pleasant Prairie Village Board authorized the issuance and sale of General Obligation Refunding Bonds totaling nearly $2,635,000. The refunding, or refinancing, of the bonds will generate a savings of approximately $24,500 in interest payments. The bonds were originally issued for work within Tax Increment District (TID) #2 and will come due in February of 2013.
The debt will continue to be paid with property taxes from businesses within TID #2. During 2012, the Property Tax Increment, or the amount allocated to pay down all of the district’s debt, was $7,241,268. Property taxes collected from the general population, or properties outside of the TID boundaries, are not used to pay for any TID improvements, programs or debt.
The Village established the district in 1999 and has made improvements throughout the last decade to make the area suitable for economic development. Improvements within TID #2 have included the acquisition of land, the installation of fiber optic cable to accommodate high-speed internet and digital media services, the construction of sanitary sewer and water mains, and the construction of roadway improvements to prepare the area for future traffic.
“The current refunding will offer the Village an interest savings of $24,500,” explained Kathy Goessl, Finance Director for Pleasant Prairie. “The Village has consistently taken a thoughtful approach to managing both debt and investment in development. Our goal is to be as prudent as possible with every dollar.” Standard & Poor’s recently maintained the Village’s credit rating of AA. The Village’s favorable credit rating, along with current market conditions, contributed to the interest savings. The 7-year note sold at a premium, which resulted in a net interest rate of approximately 1.36%.