By Conrad Dudderar
EL RENO – Canadian County this spring will pay off early $3.4 million left on a loan for the county Expo & Event Center construction project.
Canadian County Commission Chairman Dave Anderson will notify BancFirst of the county’s intention to “pay in full” a series 2019 use tax revenue note that helped fund the new fairgrounds’ complex that opened in July 2021.
To finance construction of the facility on Jensen Road East, the CCPFA secured construction loans from BancFirst for $10 million in 2018 (at a 3.5% interest rate) and $3.5 million in 2019 (at a 3.85% interest rate).
Canadian County commissioners, as members of the county’s Public Facilities Authority, voted in late December to refinance the 2018 note at a lower, fixed interest rate – $2.8% over 19 years.
Commissioners have expressed a desire to aggressively retire the debt early using Canadian County use tax revenues – which continue to rise.
These construction loans were secured by a pledge of those use tax revenues, which have been averaging more than $150,000 monthly.
“Our use tax has really been doing well,” Chairman Anderson said at the commissioners’ Feb. 14th meeting.
Use tax is a tax on goods purchased in another state for use in the taxing state, in lieu of local sales tax.
Anderson on Monday suggested commissioners pay off the 2019 note instead of refinancing that portion of the debt.
“Our note requires that we give BancFirst 30 days’ notice if we’re going to pay it off early,” he said.
Fellow commissioners authorized Anderson to notify BancFirst on March 1.
On the proposed April 1st payoff date, Canadian County would owe $3,414,999 on that 2019 note.
Canadian County now has nearly $1.4 million of use tax collections and appropriations held in four accounts that can be applied toward that amount.
“We need $2,025,052 to pay off the $3.5 million 2019 series note,” Anderson said. “This would be like loaning ourselves money, if we loan out of the general fund.”
Based on use tax collections staying flat, he estimated it would take 18 months “to pay ourselves back.”
NEW COURTHOUSE COMPLEX
Canadian County has almost $8 million in a future capital improvements’ account that has been earmarked for construction of a new county courthouse complex.
“Currently, our loan is on a variable rate of 3.85%,” Chairman Anderson explained. “If we were to refinance it at a lower rate like we did the $10 million, we’d have to pay some fees.”
He believes paying the note off early is a wise move “since we have the money and don’t have an immediate need for the dollars.”
District 3 County Commissioner Jack Stewart said he does want an architectural firm to meet with Canadian County officials in coming weeks to make a presentation “about the way they see the courthouse project proceeding.”
“But there’s no way we could ever get anything going prior to 18 months,” Stewart added.
District 1 Commissioner Marc Hader called the proposed early loan payoff “good fiscal stewardship.” He likes the idea of retiring debt and saving on interest.
Hader noted that Canadian County’s expo center remains busy with event bookings, most recently last weekend’s Oklahoma Tackle, Hunting & Boat Show.
He called the event a success as vendors shared rave reviews about the new county facility.