HomeMy WebLinkAboutA001 - Council Action Form dated June 13, 1995 ITEM #
DATE June 13, 1995
COUNCIL ACTION FORM
SUBJECT: PROPOSED REFUNDING - 1987 AND 1987B SEWER REVENUE BONDS
BACKGROUND:
The City's outstanding bonds include two Sewer Revenue Bonds initially issued in 1987
with total outstanding principal equal to $4,275,000. The financial consulting firm of
Evensen-Dodge has prepared an advance refunding analysis that indicates savings of
4.7455% if the City were to issue refunding bonds to pay the remaining principal on those
outstanding bonds. A Sources and Uses of Funds report is attached showing a total
estimated bond issue of $3,960,000. Issuance costs are included in the total. The
balance of the amount issued plus the balance in the City's existing Sewer Reserve Fund
will equal the outstanding principal of $4,275,000.
The refunding issue would be an advance refunding, with both issues being called on
December 1, 1995. In a savings report prepared June 5, 1995, cumulative interests
savings are projected to be $255,713.56 over the remaining eight years of the bonds.
The present value savings equals $220,554.87. A copy of that report is attached.
The resolution before the City Council is to authorize the City Manager and the City
Finance Director to set the terms and the date of sale and arrange for the advertisement
of the bonds. This action allows staff and Evensen-Dodge to monitor the market, proceed
with the preparation and issuance of an Official Statement, and set the date of sale. The
actual results of the sale will be presented to the City Council for acceptance.
ALTERNATIVES:
1. Adopt the resolution authorizing the City Manager and the City Finance Director to set
the terms and the date for the sale of not to exceed $4,500,000 Sewer Revenue
Refunding Bonds, series 1995.
2. Deny approval of the issuance of refunding bonds for the Sewer Revenue Bonds.
3. Request staff to return to the City Council and propose a specific date for the sale of
refunding bonds to be approved by the City Council.
MANAGER'S RECOMMENDED ACTION:
It is the recommendation of the City Manager that the City Council adopt Alternative #1,
Adopt the resolution authorizing the City Manager and the City Finance Director to set the
terms and the date for the sale of not to exceed $4,500,000 Sewer Revenue Refunding
Bonds, series 1995.
COUNCIL ACTION: