Jersey Shore State Bank offers top fixed rates for $3.6M in refinancing loans

The Lock Haven City Council meeting on July 11, 2022, focused on financial strategies for upcoming projects, particularly concerning loan options for infrastructure improvements. Key discussions revolved around securing fixed-rate loans to finance ongoing and future projects, with a strong emphasis on the benefits of locking in lower rates amid rising interest forecasts.

The council reviewed several loan proposals, highlighting Jersey Shore State Bank's offer of a fixed rate of 2.21% for a two-year term as the most favorable option. This rate was deemed superior compared to variable rates, which are expected to increase. The discussion included a sensitivity analysis indicating that even a slight rise in rates could lead to higher costs for the city.

Additionally, the council addressed the need to refinance a $1.3 million Series B note, which is set to mature in one year. This refinancing is necessary due to delays caused by the COVID-19 pandemic and other factors affecting the project timeline. Jersey Shore State Bank again provided the best fixed rate for this loan at 2.11%.

The meeting also covered a Series C note for $1.7 million, aimed at funding preliminary design and engineering for ongoing projects. The council reiterated the importance of securing fixed rates, with Jersey Shore offering a competitive rate of 2.37% for this loan as well.

All proposed loans are structured as drawdown loans, allowing the city to pay interest only on the amounts utilized, with the flexibility of prepayment without penalties. This financial strategy aims to ensure that the city can effectively manage its cash flow while advancing critical infrastructure projects.

The council plans to continue discussions on these financial options in future meetings, emphasizing the importance of making informed decisions to support the city's development goals.