Placement: Second Reading of Ordinances / Public Hearing
Action Requested: Motion / Vote
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Ordinance 23-36, Public Hearing, Amending and Supplementing Ordinance 94-29; Authorizing the Issuance of Not to Exceed $25,000,000 for Refunding the City’s Outstanding Utility System Refunding Revenue Bonds, Series 2014, in Order to Achieve Debt Service Savings.
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Submitted By: Stephen Okiye, Finance Director, Finance Department.
Strategic Plan Link: The City’s Mission to be financially responsible.
Executive Summary (General Business): To support one of City Council’s Strategic Plan goals to reduce debt, staff has determined that the City should issue Utility System Refunding Revenue Bonds, Series 2023, to refund the City’s outstanding Utility System Refunding Revenue Bonds, Series 2014 to achieve debt service savings.
Presentation Information: A short PowerPoint presentation will be available upon request.
Staff Recommendation: Move that the Council adopt Ordinance 23-XX, Amending and Supplementing Ordinance 94-29; Authorizing the Issuance of Not to Exceed $25,000,000 for Refunding the City’s Outstanding Utility System Refunding Revenue Bonds, Series 2014, in Order to Achieve Debt Service Savings.
Alternate Recommendations:
1. Move that the Council amend the recommendation and adopt Ordinance 23-XX, Amending and Supplementing Ordinance 94-29; Authorizing the Issuance of Not to Exceed $25,000,000 for Refunding the City’s Outstanding Utility System Refunding Revenue Bonds, Series 2014, in Order to Achieve Debt Service Savings.
2. Move that the Council provide staff direction.
Background: The City’s Utility System Refunding Revenue Bonds, Series 2014 are outstanding in the par amount of $25,005,000 maturing in years 2023-2034 with tax-exempt interest rates of 5.00%. The 2014 Utility Bonds are callable September 1, 2023 at par and are thus eligible to be currently refunded 90 days prior to this initial call date. By currently refunding the 2014 Utility Bonds, we estimate the City could realize approximately $2.4 million of net present value debt service savings.
Issues/Analysis: N/A
Financial Information: Under the current market conditions, it is estimated that the City would realize a net present value debt service savings of $2.4M, which equates to an annual savings of approximately $240,000 through 2034.
Special Consideration: N/A
Location of Project: N/A
Attachments:
1. Ordinance 23-XX Draft
2. Exhibit A - Form of Official Notice of Sale
3. Exhibit B - Preliminary Official Statement
4. Exhibit C - Continuing Disclosure Certificate
5. Exhibit D - Form of Escrow Deposit Agreement
6. PowerPoint Presentation
NOTE: All of the listed items in the “Attachment” section above are in the custody of the City Clerk. Any item(s) not provided in City Council packets are available upon request from the City Clerk.
Internal Reference Number: N/A
Legal Sufficiency Review:
Reviewed/Prepared by Special Bond Counsel. Approved as to Legal form and sufficiency by James D. Stokes, City Attorney.