Prince George's County officials announced yesterday that they have secured $6.1 million in financing for a methane recovery project at an interest rate they say demonstrates renewed confidence in the county's fiscal stability.
The 5.4 percent interest rate granted for the bond issue last week by the Bank of Virginia for the methane recovery project was two points below what was offered by the nearest bidder, according to county officials. That difference, finance director William Brown said, will save the county $750,000 in debt repayments over the 10-year life of the bond issue.
The bond sale for the methane project is the first the county has marketed since voters in November modified TRIM (Tax Reform Initiative by Marylanders), the charter amendment that limited the amount of property tax collected by the county. Another general obligation bond issue, for $28.5 million, will be sold July 16, Brown said.
County Executive Parris Glendening called the rate "the lowest offering this county has seen" in recent years, and Richard Newman, a bond counsel at the law firm of Linowes and Blocher, called it "exceptional."
"It reflects substantial confidence in the county," said Newman, who markets municipal general obligation bonds for Prince George's County and other jurisdictions around the country. "Because there is nothing behind these bonds but the faith and credit of the county."
That confidence, Newman and Glendening said, represents a marked improvement over last year when New York bond houses hinted that the county's AA rating could fall because of the presence of TRIM.
The first of 43 wells will be drilled within four months at the county's Brown Station Road Landfill to extract methane gas produced by decomposing garbage, officials said yesterday. When the project is completed in 1987, the gas piped from the wells and purified in nearby boilers will be used to heat the county administration building in Upper Marlboro, a new drunk drivers' facility and the county courthouse.
The project, finance director Brown said, could save the county up to $1 million a year in energy costs when it is fully operational. Maryland Environmental Service, a private firm with 10 percent public funding, is financing the system with the aid of the county-backed bonds.
"The most important thing is that this is an example of the ability of state and local government and the private sector to work together . . . to recapture a natural resource and get one heck of an interest rate," said John Seyffert, the director of MES.