Choke Canyon Bond Refunding Saves City $22 Million
CORPUS CHRISTI, TX – On Tuesday, December 19, the Corpus Christi City Council approved a refunding with the Texas Water Development Board for debt associated with Choke Canyon Dam which will reduce the number of payments as well as the amount owed.
This refunding consolidates two debts owed to the Bureau of Reclamation into one bond issuance of Utility System Revenue Bonds. The first of these is for the Choke Canyon Reservoir for $36.1 million scheduled to be paid off in 2029. The second was for fish and wildlife recreation in the amount of $12.1 million to be paid off in 2044. Both debts were consolidated and are scheduled to be paid off in 2029.
The “refunding of a bond” is when its interest rate is renegotiated, and, most cases, lowered to make it more financially viable. The refunding of this debt lowers the interest rate from 5.116% to 2.45% and shortens the payment schedule by 15 years. This results in a savings of over $22 million.
For more information, contact Director of Finance Constance Sanchez at (361) 826-3227 or by email at ConstanceP@cctexas.com.