A bond refinancing this week should save the state Parkways Authority about $330,000 a month in interest payments on $59 million in bonds, Parkways General Manager Greg Barr said Monday.

That savings should help offset a 5 percent downturn in Turnpike toll collections since March, a trend that appears to have continued in June, he said.

That would mean about a $318,000 drop in tolls from June 2007, when toll revenues topped $5.29 million.

"That's why it's imperative to get this bond issue done," Barr said.

Originally, the Parkways bonds were financed through the Financial Guaranty Insurance Corp. to take advantage of the company's "AAA" bond rating, which provided lower interest rates on the bonds.

However, FGIC's rating has since dropped to near-junk bond status because of the company's investments in subprime mortgage lenders.

As a result, Barr said, interest rates on the Parkways bonds soared to more than 10 percent.

"With the 10 percent rate that went into effect about six weeks ago, it's costing us probably $330,000 a month," he said.

The plan is to refinance the bonds, using the Parkways Authority's own "AAA-" bond rating, he said.

A bond refinancing this week should save the state Parkways Authority about $330,000 a month in interest payments on $59 million in bonds, Parkways General Manager Greg Barr said Monday.

That savings should help offset a 5 percent downturn in Turnpike toll collections since March, a trend that appears to have continued in June, he said.

That would mean about a $318,000 drop in tolls from June 2007, when toll revenues topped $5.29 million.

"That's why it's imperative to get this bond issue done," Barr said.

Originally, the Parkways bonds were financed through the Financial Guaranty Insurance Corp. to take advantage of the company's "AAA" bond rating, which provided lower interest rates on the bonds.

However, FGIC's rating has since dropped to near-junk bond status because of the company's investments in subprime mortgage lenders.

As a result, Barr said, interest rates on the Parkways bonds soared to more than 10 percent.

"With the 10 percent rate that went into effect about six weeks ago, it's costing us probably $330,000 a month," he said.

The plan is to refinance the bonds, using the Parkways Authority's own "AAA-" bond rating, he said.

Barr said bond counsel and financial advisers believe the bonds can sell at a 4.387 percent interest rate.

"The savings are significant by getting the new bonds in place as quickly as possible," he said.

The Parkways Authority has scheduled an emergency meeting for this afternoon to authorize the bond refinancing. Barr said the bond likely will go to market on Wednesday.

Meanwhile, Barr said Parkways will carefully watch traffic trends over the upcoming Fourth of July weekend, hoping to break a four-month stretch of 5 percent declines in Turnpike traffic.

Barr said he's hopeful with July 4 falling on a Friday, the three-day weekend will encourage more holiday traffic.

He said he also wants to see whether recent increases in costs for air travel will encourage vacation travelers to drive, rather than fly.

"With all the hassles with flying, and all the additional charges, people will be flying less," he said.

"It's been a nightmare for us for the last three or four months," Barr said of the combination of higher interest rates and lower toll revenues. "With higher fuel prices and a decline in traffic, we can't afford any other losses."

Reach Phil Kabler at ph...@wvgazette.com or 348-1220.