By Leah Justice

leah.justice@tryondailybulletin.com

The Polk County Board of Commissioners approved a resolution on May 4 agreeing to lower interest rates on three loans that should save the county $300,000 over the life of the loans.

Polk County Manager Marche Pittman told commissioners during his manager’s report that during conversations with the finance office, he directed finance officer Sandra Hughes to reach out to BB&T to negotiate interest rates.

Hughes said the county would not be able to finance the loans through another bank without going through the N.C. Local Government Commission (LGC) process and BB&T came back with great savings.

Hughes said through her estimates, the county should save approximately $300,000 total through the renegotiations of three loans. She clarified that she has not received the bank’s figures.

Polk’s $10 million loan, borrowed to construct the middle school was negotiated from 4.03 percent interest to 1.83 percent interest, according to Hughes, for a savings of approximately $132,000 over the life of the loan. The $10 million loan ends on March 29, 2019.

Another $7.4 million loan was negotiated from 4.11 percent interest to 1.98 percent interest, according to Hughes, which is a savings of $144,500. The $7.4 million loan Nov. 29, 2019.

The remainder of the savings comes from the county’s department of social services (DSS) building construction. Hughes said that loan was negotiated from 3.56 percent interest to 2.68 percent interest. The DSS loan ends on Dec. 9, 2025.

Hughes said the savings is from the remaining lives of the loans. She said she recreated the amortization schedule as it is currently, made sure it matched, then changed the interest rates to the new rates and computed the difference in the remaining interest to figure the county’s savings. Hughes also said the new rates do not have to be approved by the LGC, but the county does have to get the LGC’s permission before moving forward.

Pittman said the new rates will not extend the life of the loans, it is just a rate negotiation.

Commissioners unanimously approved the resolution.