By Philip Haldiman | The Arizona Republic
Cave Creek is refinancing a loan that helped purchase the Cave Creek Water System because the town has not met the revenue-to-debt-service coverage the lender requires.
The Town Council has allowed staff to split a $20.1 million loan to the town by the Water Infrastructure Finance Authority of Arizona so it can meet its requirements and pay it off more easily.
The debt-service coverage ratio is a benchmark lenders use to measure a town’s ability to have enough revenue to pay its debt service.
The loan, which allowed for the purchase of the Cave Creek Water System in 2007, is one of nine loans the town has with WIFA that have funded improvements over the years in the town and the surrounding area.
