COLLINSVILLE — The city plans to refinance its loans to save about half a million dollars.

The Collinsville City Council voted unanimously Tuesday to refinance part of its 2006 series of bonds. The $20 million bonds were taken out to expand the city's sewer plant, with a 4.3 percent interest rate.

However, the city's advisory firm, Speer Financial, has recommended refinancing the remaining debt in two batches for a total savings of $500,000.

"I'm happy to see this happen," said Councilwoman Nancy Moss.

This year the city will refinance $10 million, and another $6.5 million next year. The cost for the refinance will be about $150,000, but total savings will be about $650,000, for a net gain of $500,000, according to Speer Financial.

"Reducing the interest rate helps us pay down the debt quicker and gets us back where we should be," said Mayor John Miller.

The council also voted to set public hearings in its proposal to create a business district along St. Louis Road and expand the existing business district near Collinsville Crossing. Councilman Jeff Kypta voted against the hearings, restating his opposition to the projects.

Contact reporter Elizabeth Donald at edonald@bnd.com or 239-2501.