Cumberland County supervisors will hear public comment Tuesday on the proposed issuance of a general obligation bond from the Virginia Public School Authority (VPSA) for up to $18.5 million as part of restructuring the county’s debt load. The hearing will be held at 7 p.m. in the circuit courtroom at the courthouse on Route 60.

“An obligation that’s outstanding to SunTrust would be paid off through this,” County Administrator and Attorney Vivian Seay Giles said. “And, to restructure that, based on the numbers we’re looking at right now, over time, over the remaining life of the loan, the projection is it would save the citizens over $600,000.”

According to Giles, roughly $17 million is currently outstanding on the loan. She also projected lower interest rates would result in savings for the county as part of the restructuring.

The hearing comes after supervisors gained direction during an Aug. 25 workshop regarding how it would like to restructure part of the county’s debt. A majority of the board favored an option to refinance its 2012 bonds through the VPSA following a presentation by Davenport & Company.

“What it would mean (is), on an annual basis — and we don’t know the final interest rate yet because that won’t be set until October — so right now we’re looking at projections and we’re continuing to monitor it,” Giles said. “It … is a real dollar savings because of the lower interest rate.”

She said the proposed bond would be paid off in fiscal year 2030.

“Based on the market right now, it seems that VPSA would be the most advantageous,” Giles said.

According to the public hearing notice, the resolution, if approved by supervisors, would authorize the issuance of an estimated maximum of $18.5 million principal amount of general obligation school bonds of the county. More than 10 percent of the bond proceeds are proposed to be used to finance and refinance the county’s high school complex school facili-ties located in the county, all of which constitute capital projects for public school purposes.

According to the Davenport presentation, the 2012 bonds were a direct bank loan from SunTrust issued to refinance the county’s 2008 lease revenue bonds. Those bonds were incurred through the construction of the county’s middle school/high school complex. Giles said the amount left to be paid on this debt is a little less than $17.9 million, representing about half the county’s total debt.

Under the current arrangement, that debt should be paid off by July 15, 2029, but with a fixed interest rate of 2.96 percent only good through Jan. 1, 2025.

The restructuring option the board is pursuing, called Option 1, will see the debt paid off by Aug. 1, 2029, with a fixed interest rate throughout the term and potentially lower than 2.96 percent.

“The rate won’t be set until October,” Giles said in August, adding the county would re-evaluate the debt restructuring proposal if the interest rate ends up being more than 2.96 percent.