County Commissioners agreed Monday to a plan that would allow them to refinance more than $4 million in outstanding state gas tax bonds and save more than $200,000 if interest rates hold at the current level.

Reid Cavnar with Merchant Capital presented commissioners with the plan, which would not extend the term limit on the bond measure. Cavnar said the commission should capitalize on the decrease in interest rates, which are at a historic low.

“All this would do is lower the interest rate,” Cavnar said. “It would not extend the bond or extend the term limit. Of course, the rates could change between now and the time we get the paperwork done, but you have the option of waiting until you choose to execute the paperwork.”

Before the bonds can be sold to investors, Cavnar said the county must put together a prospectus, which will outline general information about the county and its finances for investors, as well as get its bonds rated.

“When we get that information together – at no cost to you – we’ll see what the rates are and go from there,” he said. “The market can go up or it can go down.”

Commissioners have three options for utilizing the savings from the refinancing – one, an up-front payment to be used for road projects; two, apply it to the first payment on the bond measure; or three, lower the payment by $15,000 to $20,000 over the life of the bond.

“I think this is a great opportunity for the county,” said Commissioner David Ellis.

“There’s no new money involved with this. It’s just refinancing existing debt.”

Chairman Lynn Sasser said the move could represent “substantial” savings for the county.

In other business, the commission:

• re-authorized the Covington Area Transit System to enter into third-party contracts.

• renewed the county’s contract with Southeast Alabama Regional Council on Aging for in-home service, as well as the juvenile long-term detention contract with the state that provides one bed at the Dothan detention center.

• approved a contract with the Florala and Andalusia Farmer’s Co-Ops for seed and fertilizer, as well as a contract with J.D. Fields for steel piling.

• signed a resolution to contract with the state to replace road signs in the northern part of the county. County Engineer Darren Capps said the $36,259 grant requires a 10 percent match and will be utilized to replace the signs on paved roads.