The Idaho Transportation Department is refinancing the state’s GARVEE bonds for highway improvements for a second time, and says the state will save $13.1 million in interest costs as a result. The first time the GARVEE bond debt was refinanced to a lower interest rate, in 2015, the state saved $12.7 million.

The GARVEE acronym loosely stands for Grant Anticipation Revenue Vehicle, and is a special type of bonding authorized by Congress that allows states to borrow against their future federal highway allocations, to complete bigger projects sooner. Idaho’s used the program to pay for $857 million in road and bridge work in the last 10 years; it first ventured in the bonding program at the urging of then-Gov. Dirk Kempthorne, who proposed a “Connecting Idaho” initiative aimed at upgrading key highway corridors throughout the state.

“Through GARVEE, we are investing wisely by spending the money now to solve the transportation problems of tomorrow,” ITD Director Brian Ness said in a news release. “We are paying less than the anticipated cost of inflation for the same construction work in years to come.”

ITD Chief Administrative Officer Charlene McArthur said, “ITD continues to look for opportunities to take advantage of favorable market conditions and ensure that we are managing our finances wisely for the taxpayers of Idaho. We apply those savings back to maintenance and improvement of our roads and bridges.”

ITD and the Idaho Housing and Finance Association are projecting the $13.1 million in savings by refinancing the current $101 million in debt to move interest rates from 4.5 percent to 2.3 percent. In the 2017 legislative session, lawmakers approved an additional $300 million on GARVEE bonding authority.