SHAMOKIN - The city is again attempting to refinance outstanding debt that could free up hundreds of thousands of dollars.
A refinancing plan under review by city council could reduce debt payments on three outstanding loans by more than a combined $293,000 over the next four years and nearly $318,000 total until the loans mature in 2031.
Interest rates would drop by as much as 2.6 percent on one of the loans, and one maximum rate cap would plummet by 11 percent.
Council members voted 5-0 during a special meeting Wednesday to approve the plan.
Final approval is expected during Monday's regularly scheduled council meeting, putting the plan in effect for 2013.
A similar plan approved by city council in September 2011 faltered when a Berwick bank reviewed the plan and turned it down based on the city's financial standing at the time, said Councilman William Milbrand.
"We've improved a lot financially since then," said City Clerk Steve Bartos, who added that Susquehanna Bank, of Shamokin, is on board with the latest financial restructuring attempt.
Council worked with Concord Public Finance on both plans.
The city currently owes a combined $1,883,876.75 on three bank notes taken between 2003 and 2006. Interest rates for the three are (with the maximum capped rate in parentheses): 3.98 percent (17 percent), 7.11 (11.11), 4.95 (7.25).
After restructuring, each rate would drop: 3.4 percent (6 percent), 4.5 (8), 3.4 (6).
All three rates would be fixed for seven years.
Under the current debt service plan, $172,889.30 is due annually until 2027.
Restructuring would drop the annual amount due between 2013 and 2016 to $77,433.24, $107,423, $106,139 and $106,905. After that, an average annual savings of roughly $8,000 on the payments would be realized until 2027.
The last four years of the proposed plan see comparatively slight increases in payments compared to the current plan.
Mill Road renovations
City council and the city's Redevelopment Authority each voted during Wednesday's special meeting to contract with a Shamokin firm to renovate the lone vacant space at Mill Road Square on North Franklin Street.
The renovated space will be occupied by Dr. Sanjay Sen, according to city officials.
Evolutions Contracting submitted the lowest of two bids for the work when it proposed $91,426.80.
The second bid from Tycon Construction LLC, of Doylestown, totaled $139,607 plus an alternative of $1,110.
There were no bid bond requirements.
The bidding was reopened after previous bids of $162,765 from Bognet Inc., Hazle Township, and $118,980 from Moore Renovations, Coal Township, were rejected in October.
Jim Moore, of the latter firm, was at Wednesday's meeting and told a city official his firm was working with Evolutions Contracting on the project.