Seward County and Southwest Medical Center got some great news at the County Commission meeting on Monday, March 15th. County Commissioners approved a resolution authorizing the issuance of a $4,650,000 bond issue to refund the remaining outstanding general obligation bonds issued in 2010 for improvements to the hospital in Liberal. The refunding bonds sold at a financing cost of 1.72% for the 18-year bond issue.
The 2021 bond issue refinanced the County’s Series 2010-A bonds that were outstanding at rates from 3.4% to 5%. The lower interest rates resulted in debt service savings of $2,424,068.79 for Southwest Medical Center. Although the bonds were issued by Seward County, Southwest Medical Center has always paid the principal and interest on the debt. The refunding will reduce debt service payments for the hospital by approximately $75,000 per year and actually pay off all debt one year earlier than the original plan of finance.
The refunding transaction was structured and marketed by the Wichita Public Finance office of Stifel. Managing Director Steve Shogren stated “We are extremely proud to provide underwriting services to Seward County on this cost-effective transaction. With near historically low interest rates, the County and Southwest Medical Center were prudent to lock-in tremendous savings at this time. The savings result is one of the largest ones percentage-wise that our office has ever accomplished”.
The Series 2021 General Obligation Refunding Bonds were rated “AA-” by S & P Global. This was a significant upgrade in credit rating for the County.
With approval by County Commissioners, the transaction will be submitted to the Kansas Attorney General’s office and closing is planned for March 31.