General Obligation Bond Refinancing Saves Taxpayers $12 Million

BATON ROUGE, LA – State Treasurer John Kennedy announced Wednesday that the refinancing of $228.54 million in general obligation bonds is complete, saving taxpayers $12 million.


“We refinanced to generate savings on money that was borrowed to fund construction projects across Louisiana,” said Treasurer Kennedy. “Just like homeowners refinance their mortgages, we refinanced bonds to take advantage of lower interest rates.”


The state refinanced the bonds after the Division of Administration agreed with Treasurer Kennedy’s insistence on informing potential investors of the state’s $140.6 million operating deficit. The state ended the 2013-2014 fiscal year with a budgetary shortfall.


Investors expressed great interest in the refinancing issue, placing more orders for the bonds than could be met. Louisiana was competing for interest against Hawaii’s $1 billion general obligation sale.


“We were upfront with investors about our budget problems, and interest did not diminish,” said Treasurer Kennedy. “We achieved great savings for Louisianians.”

Contact:
Michelle Millhollon
(225) 342-0012
mmillhollon@treasury.state.la.us