The Kentucky Municipal Power Agency (KMPA) and Paducah Power System (PPS) each successfully executed bond refinancings this week, capitalizing on historically low interest rates. KMPA's refinancing will stabilize debt service and prevent an increase in bond payments of approximately $4.4 million scheduled for next year, directly benefiting its members' (PPS and Princeton Electric Plant Board) rate payers. Overall, the refinancing will levelize and lower KMPA's bond payments for the foreseeable future. PPS's refinancing results in approximately $1.275 million in savings over the next five years.
"Today's refinancings went even better than expected," KMPA Board Chair Hardy Roberts said. "Demand was very high for our bonds, and we had a good mix of new and previous investors."
PPS General Manager Dave Carroll said, "We chose the opportune time to go to market. We had great pricing and structure on our bonds and we came away with results that directly benefit our customers."
KMPA refinanced more than $148 million in bonds, while PPS refinanced $26.5 million in bonds. Closing is scheduled for early September.