ALBANY ALBANY — City leaders tentatively agreed Tuesday to refinance $225,000 in outstanding debt originally used to help MacGregor Golf Company, possibly saving $44,000 over the life of the note, officials say.
In 2000, the Albany City Commission entered into a bond agreement with the Payroll Development Authority to essentially underwrite $500,000 to finance the MacGregor Golf Company project.
Fast-forward nine years and MacGregor, a worldwide name in golf clubs and other sporting equipment, shuttered its world manufacturing headquarters here in Albany and sold its name and intellectual property rights to Texas-based Golfsmith. The move left local taxpayers holding the tab that was originally drafted to help keep them in business.
Since that time, the PDA has worked to pay down the existing debt. That $500,000 note is more than half paid. Tuesday, city officials shaved off another $44,000 by refinancing the remaining $225,000 at a dramatically lower interest rate.
LaToya Cutts, director of the city’s Community and Economic Development Department, told commissioners that market conditions would allow the city to refinance the remainder of the balance at 1.34 percent, far below the current 6.37 percent on the note.
“The end result is that we think we’ll save a good bit of money without extending the length of the note,” Cutts said.
The commission’s move to refinance the Section 108 note doesn’t impact a second loan drawn on the property by SunTrust Bank in which the city and the PDA is a guarantor on, Cutts said.
That note, which is currently worth somewhere between $650,000 to $700,000 based on a estimate by City Manager James Taylor, continues to be paid down on schedule by the PDA.
Albany Mayor Willie Adams asked Taylor and Cutts if it wouldn’t be prudent to approach SunTrust and ask if they would consider a refinancing of that amount as well.