The city will capture $893,536 in taxpayer savings by refinancing $16 million in bonds on a day when interest rates for municipal bonds were at record low levels, and demand for Milford bonds was high, Mayor Ben Blake said in a press release issued Thursday.

"I am pleased to announce today the city will be refinancing $16 million in bonds, securing a very favorable 1.96% net interest rate on bonds which were originally financed at an average rate of 3.7%,” Blake said. “The sale will yield a total savings of $893,536, or 5.07% of the initial obligation.”

In addition to the tax relief from the present bond refunding, the city realized savings of approximately $3.9 million in the last few years from four prior refunding issues, Blake said.

The mayor credited Matthew Spoerndle, director of Phoenix Advisors, LLC and Peter Erodici, Milford's director of finance, with the cost saving measure.

Blake also cited Milford's bond rating as a key to the transaction.

"Milford would not be able to secure these rates if we did not maintain excellent bond ratings,” Blake said. “The three rating agencies, Moody’s, Standard & Poor’s and Fitch – recently gave our city high marks for prudent fiscal practices amid the downturn in the real estate market. All three affirmed the city’s bond ratings — Aa1 for Moody’s, AA+ for S&P and Fitch.”

The Board of Finance discussed the refinancing during a budget meeting Thursday night, noting the positive impact it will have on the 2016-17 budget.