Rates jump prior to signing of library loanWritten by Becky Johnson
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Hints of an up tick in the economy are good news to say the least, but a resulting rise in interest rates came a little too soon for Jackson County taxpayers.
Interest rates jumped almost 0.75 percent on the eve of locking in a construction loan, costing the county $500,000 over the 15-year life of the loan. The county is taking out a $10.295 million loan. The first $7 million will pay for the new library and renovate the historic courthouse, and $3.2 million is slated for construction on the campus of Southwestern Community College.
The county was quoted an interest rate of 3.97 percent on a loan from BB&T. But the county had to wait to lock in the rate until it was within a 45-day window of signing. Just days before the county moved into that 45-day window, the rate went up to 4.63 percent.
The taxpayers are still coming out ahead on the project, however. Construction for the library and renovations to the historic courthouse were roughly $1.5 million less than expected, presumably because contractors hungry for work were offering their best price.
The annual payments on the loan will cost about $1.1 million a year initially, decreasing over time as the principle is paid down and interest decreases.
In addition to the $7 million being put up by the county for the library, Friends of the Library is raising $1.5 million to furnish the interior.