For Immediate Release:
March 22, 2016

MCIA pooled loan program saves towns millions
1.6 percent interest rate generated by County guarantee saves $3.5 million

FREEHOLD, NJ – Fifteen municipalities that participated in the Monmouth County Improvement Authority’s (MCIA) recent pooled loan refunding program saved a combined $3,511,897 by refinancing old debt. The level of savings was possible because the county guaranteed the bonds.

“Monmouth County municipalities participating in this bond sale see the value of using the MCIA to finance their debt,” said Freeholder Deputy Director Serena DiMaso, liaison to the MCIA. “They receive the benefit of the county’s AAA bond rating which provides them the lowest possible interest rate on the loans. They also receive additional savings by sharing costs and using the county guarantee rather than acquiring bond insurance on their own.”

With the county guarantee each of the towns achieved a present value savings of five percent or more. The participating towns are: Allentown, Bradley Beach, Eatontown, Freehold Township, Highlands, Holmdel, Keansburg, Manalapan, Middletown, Neptune Township, Ocean Township, Sea Bright, Shrewsbury Borough, Shrewsbury Township and Wall.

The tax-exempt bond market, which continues to experience some of the lowest rates in history, is another factor that contributed to the savings. That, combined with the County’s perfect bond rating, netted a true interest cost of 1.642 percent, creating $3.5 million in savings.

In this latest pooled bond sale, each refinancing generated significant savings for the participating municipalities without extending the life of the loans.

“I urge municipalities not involved with the MCIA to use the county’s pooling power and funding power keep expenses low,” DiMaso said. “This program has been run annually since 1993 and it is a great way to save money and keep bills under the 2 percent cap.”

“Helping municipalities, school districts and other eligible agencies save money through the MCIA’s programs can go a long way toward helping local governments keep their taxes low,” said Al Rosenthal, chairman of the MCIA.

The MCIA has generated $140 million in savings since it was formed in 1986. The MCIA is a County agency whose singular focus is on finding alternatives to traditional methods of public finance that generate savings for Monmouth County, its municipalities and other local government entities.

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