Lynchburg College is seeking industrial revenue bonds through the city to finance its initiatives to use less electricity and water.
A subsidiary of SunTrust Bank has agreed to loan the college up to $5 million at 4.35 percent interest if the city of Lynchburg issues the bonds, said Steve Bright, LC’s vice president of financial affairs.
On Thursday morning, Lynchburg’s Economic Develop-ment Authority approved up to $5 million in bonds. The board’s approval is a recommendation to City Council, which will discuss the matter in February and make the final decision.
Although the city would issue the bonds, the college would bear all responsibility to repay them, EDA attorney Ted Craddock said.
Banks usually charge lower in-terest rates on industrial revenue bonds issued by the city because they can claim tax exemptions for some of the cost of providing the loan, Craddock said.
In December, LC announced a plan to reduce its utilities costs and environmental impact. It involves replacing light bulbs, upgrading heating and air condi-tioning systems and replacing water faucets and showerheads.
After the changes, LC could reduce its water usage by 38 percent and its electricity usage by 34 percent, Bright said. Con-sidering the rising price of elec-tricity, “that is a very good thing,” Bright said to the EDA board members. “The (cost) reduction is going to pay the debt.”
“It’s a very exciting (project) for us because not only does it make business sense, but it also makes sense for the environment,” he said.
Bright said he will meet with energy services company Ameresco next week to discuss the implementation of the changes around the campus.
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