Loan refinancing to save New Kensington water authority $350K
The New Kensington water authority will refinance two loans that total $6.4 million that will save more than $350,000.
The authority board gave the business to First Niagara Bank on Thursday night.
The 10-year loan will retire a $4 million loan owed to Citizens Bank to pay for a 2008 water meter project and a $2.4 million PennVEST loan for a water mainline extension in Lower Burrell, Upper Burrell, Allegheny Township and Washington Township.
Five banks submitted proposals, according to Joseph Muscatello, managing director with Boenning & Scattergood, a financial services firm.
First Niagara came in with the lowest interest rate, 1.95 percent.
“The low rate says a lot about the authority and how it has been run,” Muscatello said.
The refinancing of both loans will save the authority at least $355,000, he said.
The authority could save even more money as the repayment of the loan will be twice a year, instead of the current monthly payments. With favorable interest rates, the authority can hold its loan payments longer, accruing interest, he said.
A closing date has not been set.
Mary Ann Thomas is a staff writer for Trib Total Media. She can be reached at 724-226-4691 or email@example.com.