The City and County of Honolulu has sold $112.4 million of Wastewater System Revenue Bonds at an interest rate of 4.617 percent, an all-time low borrowing cost for the wastewater system.

Proceeds will pay off $106.8 million in auction-rate certificates whose interest rates have risen because of a liquidity crisis affecting financial markets. The new bonds were sold with a fixed rate, with local retail investors grabbing about $30 million.

The balance were sold to institutional investors on the Mainland and in Hawai'i, the city said.

"Refinancing increasingly costly auction rate certificates at a low, fixed interest is very beneficial to our wastewater financial picture, said Eric Takamura, city director of Environmental Services, in a press statement.

The auction-rate bonds' interest rate jumped on March 6, triggering a default rate that was recently 5.163 percent.