If Congress passes bailout, interest on Saratoga water bonds could fall
The council has adopted a resolution to issue $2.4 million in water-revenue bonds for the development of secondary water systems on the south end of the city between Redwood Road and Utah Lake.
The bonds mature in 25 years and could carry an interest rate as high as 7.5 percent, but city accountant Chris Pavia is expecting the rate to be closer to 5 percent or 6 percent or even lower.
"Seven-and-a-half percent is really high. If the bailout passes, it may go lower," he said. "The bonds are repaid with impact fees so there isn't much risk associated with these bonds."
A public hearing is scheduled for Oct. 14 for residents to discuss the economic impact of the bonds on their property with the council. The hearing begins at 7 p.m. in City Hall.
The bonds more directly affect developers, city recorder Lori Yates said.
Future subdivisions are already laid out with some further advanced than others, Pavia said. The bonds will finance the secondary water systems for those homes. When builders pay the $1,800 impact fee for secondary water for each home they build that money goes toward paying back the bonds, Pavia said.
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