Philadelphia has cut $1.4 million a year from its budget-busting legacy-borrowing costs by refinancing $102 million in 5.39% bonds to a lower 3.10% rate.

"We reduced debt service by $19.9 million in total" from next year through 2026, said city treasurer Nancy Winkler, on her way back to Philadelphia from the New York sale this afternoon.
The deal refinanced bonds originally issued to pay for ex-Mayor John Street's slum-wrecking Neighborhood Transformation Initiative program. 
A group led by Citibank and including Loop Capital, Barclays, Janney Capital Markets and PNC paid the city a $12.4 million premium for the old bonds. The city issued $91.3 million of the lower-rate bonds.
The savings, compared to the city's most recent previous bond issue, works out to about 50 basis points -- half a percent -- thanks to the combination of low U.S. interest rates, an improved Standard & Poor's bond rating (now BBB+ with a "positive outlook", up from BBB), and "knowing how to push the banks," said Winkler, who worked at muni bond advisor PFM before joining the city administration under Mayor Nutter.