The City of Knoxville wants to help Knoxville Hospital and Clinics save money as they refinance debt. The hospital asked the city to assist in up to $3.5 million worth of conduit bonds. With the city’s assistance, the hospital can receive a more favorable interest rate on their debt.

City Manager Harold Stewart compares the action to co-signing on a loan without being liable for the debt. Cities may issue up to $10 million in conduit bonds each calendar year. Stewart says that it allows communities to assist non-profits in their projects.

A public hearing on the measure has been set for November 5th. Stewart notes that the city would not be liable for anything if the hospital for some reason would not be able to pay it off. The conduit bonds do not impact the city’s debt limit or credit rating.