Legislative session addresses airport's request to refund bond
It was day three today of the August legislative session.
Senators discussed a bill to allow the airport to refund a portion of an existing bond to take advantage of lower interest rates, and then to use the savings for more capital improvements.
The Guam International Airport borrowed $245 million in 2013 for several major projects, primarily the construction of a new third floor arrivals corridor. But budget Director Lester Carlson says this would be a good time to take advantage of favorable market conditions.
"The request before you today is to get your approval so that we can refund a portion of the bonds, always ensuring that the net present value of the savings of a minimum of 2 percent is achieved at any juncture," he said.
The airport expects to save about $2 milllion a year in interest as a result of the refunding. The bill by Sen. Joe San Agustin would also extend the same refunding authorization to all other outstanding portions of the airport bond, as Guam Economic Development Authority Deputy Administrator Ricky Hernandez explains.
"And so if there's a portion sometime in the future that is within the parameters of the savings, 2 percent net present value savings in the future, then the bill essentially requests for that authorization for that period of time," he said.
The airport says the money would go to a variety of capital improvements such as runway and apron rehabilitation.
Senators were clearing out the remaining bills on the agenda ahead of next week's expected debate over the fiscal year 2020 budget bill.