Long Island Power Authority Saves $131 Million on Refinancing

New York’s Long Island Power Authority saved $131 million through a refinancing of about $2 billion of debt, according to Mark Gross, a spokesman for the agency.

The Utility Debt Securitization Authority, created by the state legislature to handle the borrowing, issued AAA bonds this week to refinance LIPA debt that’s graded at least six steps lower.

The deal marked the first time a U.S. municipal utility issued debt backed by a separate charge on customers. Savings will be used to freeze rates for the next two years and reinvest in the utility to improve reliability, Chief Financial Officer Mike Taunton said in an interview.

To contact the reporter on this story: Martin Z. Braun in New York at mbraun6@bloomberg.net

To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net

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