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Loan pool program helping New Jersey communities. (Editorial Viewpoint).

Thanks to a suggestion made several years ago six more New Jersey municipalities can now pursue needed local projects and save on borrowing costs with the help of tax-exempt bonds totaling nearly $21.4 million sold through the New Jersey Economic Development Authority (EDA). The third EDA/New Jersey Conference of Mayors Governmental Loan Pool program bond issue brings the total financed through the program to more than $73 million for projects in 17 New Jersey communities.

The program was developed specifically for municipalities without access to a county-sponsored financing program for capital needs. Local governments can improve their purchasing power and save on borrowing costs, said Governor James E. McGreevey.

Caren S. Franzini, executive director of the EDA (, said the program was developed nearly three years ago at the suggestion of the New Jersey Conference of Mayors, which asked the authority to structure a lending program that could help municipalities in the Garden State borrow long term at more favorable rates than they could obtain individually.

"The resulting bond pool structure enables participating municipalities to take advantage of a superior credit rating and low market interest rates," she said. "Each municipality backs its own share of the pooled bond issue, so there is no financial exposure to the EDA."

The bond issue is backed by Ambac Assurance Corporation, which assures bond holders of repayment and helps reduce interest costs.

In some cases, the loans will be used to purchase public works vehicles and equipment, build new municipal buildings, and to improve sidewalks and roads.

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Publication:Public Works
Article Type:Editorial
Geographic Code:1U2NJ
Date:Mar 1, 2003
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