Vol. 6 No. 2 Fall 1998
A Newsletter About New Jersey's Water Quality Programs

The Trust, as part of the Financing Program, sells revenue bonds each year to capitalize low-interest loans for wastewater, stormwater, and drinking water projects. The Financing Program provides two loans to each borrower. One loan, capitalized with state and federal dollars, is a 0% interest loan to cover half of a project's costs. The Trust provides a second loan to cover the remaining portion of a project's cost at the interest rate received on Trust revenue bonds. Together, the two loans provide full funding of a project's costs at half the market rate.

On April 30, 1998 the Trust refinanced portions of seven series of outstanding bonds issued in 1988, 1989, 1991, 1992, and 1994. Proceeds of the original bonds-that totaled $107.8 million at the time of closing-were used to provide loans to 35 borrowers for construction, repair and replacement of wastewater treatment systems.

The Trust periodically reviews outstanding bond issues to determine if advanced refunding will produce debt service savings for program participants. The savings for each refunded series is allocated among the borrowers within that series based on their allocable share. Because the original loans remain in place, these savings are applied as credits to the original debt service schedule for each loan. The 1998 Refunding Bonds realized a Total Savings of $4,185,000.

"I am proud the Environmental Infrastructure Trust has again executed a successful refinancing," said Trust Chairman Ellis S. Vieser. "Our job is to help New Jersey municipalities and their agencies achieve the greatest possible gains in cleaner water at the least cost to their taxpayers and ratepayers. By carefully monitoring the financial markets and acting when circumstances are favorable, we are assuring that New Jersey citizens get the most for their money," he said.

The Trust refinancing issues are as follows:

Refunding Bonds, Series 1998A	Wastewater Treatment Insured Bonds, Series 1988A
Participants:	Township of Roxbury
Aggregate principal amount: $640,000 Insured by MBIA True interest cost: 4.66% Original true interest cost: 7.43% Awarded to Paine Webber Net Present Value Savings: $66,325 Net present value savings as a percentage of refunded principal: 9.67%
Refunding Bonds, Series 1998B	Wastewater Treatment Bonds, Series 1988B
Participants:	Borough of Princeton, Township of Princeton
Aggregate principal amount: $3,960,000 True interest cost: 4.51% Original true interest cost: 7.35% Awarded to Salomon, Smith Barney Net Present Value Savings: $422,191 Net present value savings as a percentage of refunded principal: 10.31%
Refunding Bonds, Series 1998C	Wastewater Treatment Bonds, Series 1991A (Refinancing Program)
Participants:	Bayshore Regional SA, County of Burlington, Camden County MUA, Township of Cedar Grove, Hackettstown, Township of Holmdel, Montville Township MUA, Borough of Paramus, Pequannock, Lincoln Park & Fairfield SA, Town of Phillipsburg
Aggregate principal amount: $36,815,000 True interest cost: 4.48% Original true interest cost: 6.39% Awarded to Salomon, Smith Barney Net Present Value Savings: $1,181,811 Net present value savings as a percentage of refunded principal: 3.004%
Refunding Bonds, Series 1998D	Wastewater Treatment Bonds, Series 1992A
Participants:	Berkeley Township SA, Camden County MUA, Borough of Hawthorne, Phillipsburg Town, Wayne Township
Aggregate principal amount: $6,330,000 True interest cost: 4.67% Original true interest cost: 6.32% Awarded to First Union Capital Markets Net Present Value Savings: $421,338 Net present value savings as a percentage of refunded principal: 5.21%
Refunding Bonds, Series 1998E	Wastewater Treatment Insured Bonds, Series 1992B
Participants:	Clinton Town, Delran SA, Hammonton Town, Middlesex County UA, Millville City, Woodstown
Aggregate principal amount: $14,610,000 Insured by MBIA True interest cost: 4.64% Original true interest cost: 6.24% Awarded to Merrill Lynch Net Present Value Savings: $1,063,119 Net present value savings as a percentage of refunded principal: 5.20%
Refunding Bonds, Series 1998F	Wastewater Treatment Insured Bonds, Series 1994A
Participants:	Berkeley Township SA, City of Gloucester, Borough of Hawthorne, Township of Manchester, Township of Morris, Borough of New Providence, Ocean County Utilities Authority, Pequannock River Basin SA, Township of Randolph
Aggregate principal amount: $10,950,000 Insured by MBIA True interest cost: 4.78% Original true interest cost: 6.37% Awarded to Merrill Lynch Net Present Value Savings: $380,753 Net present value savings as a percentage of refunded principal: 3.28%
Refunding Bonds, Series 1998G	Wastewater Treatment Insured Bonds, Series 1994B
Participants:	Township of Allamuchy, Mt. Laurel Township MUA, City of Newark, Borough of North Arlington,City of Trenton
Aggregate principal amount: $17,090,000 Insured by MBIA True interest cost: 4.79% Original true interest cost: 7.43% Awarded to Merrill Lynch Net Present Value Savings: $646,782 Net present value savings as a percentage of refunded principal: 3.35%