HomeMy WebLinkAboutA001 - Memo from Finance Director dated August 6, 1998 - Refunding Analysis AExcephowl
emo
Finance Department
TO: Steve Schainker, City Manager
FROM: Alice J. Carroll, Director of Finance
DATE: August 6, 1998
SUBJECT: Refunding Analysis, 1992 G. O.
I had a call from Dave Dirks yesterday suggesting we go ahead with the authorization for this
refunding so we can move when the market is good. He is going to ask Helmick to update the
proceedings for the August 25 Council meeting. The action requested would be to authorize the
refunding and authorize the City Manager and Finance Director to set the date of sale. A copy
of their July 15 updated analysis is attached.
EVENSEN DODGE INC
July 15, 1998
Ms. Alice Carroll
Finance Director
City of Ames
515 Clark Avenue
Ames, Iowa 50010
Re: Updated Refunding Analysis
$6,010,000 General Obligation Bonds, Series 1992
Dear Alice:
Enclosed please find the periodically revised refunding schedules which update and modify the
refunding analysis letter dated March 30, 1998. Interest rates are approximately the same as in
early January and therefore the total and present value savings remain the same. However, with
the passage of time, the structure of the refunding has changed. The items which have been
updated are discussed below.
1. The dated and delivery date are September 1, 1998.
2. The first interest payment date is December 1, 1998.
3. First maturity payment is June 1, 1999.
4. No cash contribution from the City.
Current market conditions are approximately the same as June 23, 1998 for the City's $5,130,000
General Obligation Corporate Purpose Bonds, Series 1998A. Therefore, I have used the reoffering
yields from that bond sale. The results in the current market equal: 1) $106,500 for total savings;
and 2) $96,800 for present value savings or 3.09%of the refunded 1992 par amount..
Please review the assumptions and schedules and call Dave Dirks or me with any questions or
comments.
Sincerely,
EVENSEN DODGE, INC.
Brian T. McQuillan
Vice President
cc: Dave Dirks
Enclosures
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601 Second Avenue South, Suite 5100, Minneapolis, MN 55402
612/338-3535 800/328-8200 FAX 612/338-7264
ATTACHMENT A
CITY OF AMES, IOWA
General Obligation Refunding Bonds,
Series 1998
List of Assumptions
1. Dated date: September 1, 1998
2. Delivery date: September 1, 1998
3. First interest payment date: December 1, 1998
4. First maturity payment date: June 1, 1999
5. Last maturity payment date: June 1, 2004
6. Fiscal year end: June 30, 1997
7. The Refunding Bonds are expected to be rated:
S&P-"AA" /Moody's-"Aaa'
8. Bond insurance: Qualify Refunding Bonds for
insurance
9. Issuance costs: $30,000
10. Underwriter's discount: $5.00/$1,000
11. Refunding Bonds'redemption date: Not subject to redemption
12. Equity contribution from the City: To be determined.
13. The$6,010,000 General Obligation Bonds, Series 1992 to be refunded are identified below:
Maturities Included Redemption Redemption
Par Amount From To Date Premium
$3,125,000 2000 2004 6/1/99 PAR
14. Escrow account securities: To be determined.
ATTACHMENT B
Preliminary Refunding Analysis
City of Ames, Iowa
$3,255,000 G.O. Refunding Bonds, Series 1998
Uniform Savings 11 Market is 07/14/98 11 Scale = 6/23/98 Sale
Sources and Uses of Funds
---------------------- -
Delivery Date: 9/ 1/98
Sources of Funds
----------------
----------------
Par Amount of Bonds................... $3,255,000.00
+Premium /-Discount................... $0.00
Bond Proceeds........................................... 3,255,000.00
-------------------
S3,255,000.00
Uses of Funds
Deposit to Escrow Account............................... 3,207,935.49
Cost of Issuance........................................ 30,000.00
Underwriters Discount...................( 0.500000%)... 16,275.00
Contingency............................................. 789.51
-------------------
S3,255,000.00
Prepared by Evensen Dodge, Inc.
Micro-Muni Sizing Date: 07-14-1998 a 13:54:05 Filename: AMES Key: REF
City of Ames, Iowa
$3,255,000 G.O. Refunding Bonds, Series 1998
Uniform Savings 11 Market a 07/14/98 11 Scale = 6/23/98 Sale
--------------
--------------
Savings Report
--------------
--------------
- - - - - - - - Proposed Debt Service - - - - - - - - Prior Cumulative
Date Principal Coupon Interest Total Debt Service Savings Savings
12/ 1/98 32,803.75
6/ 1/99 60,000.00 3.650000 65,607.50 158,411.25 179,375.00 20,963.75 20,963.75
12/ 1/99 64,512.50
6/ 1/ 0 655,000.00 3.900000 64,512.50 784,025.00 804,375.00 20,350.00 41,313.75
12/ 1/ 0 51,740.00
6/ 1/ 1 650,000.00 4.000000 51,740.00 753,480.00 769,375.00 15,895.00 57,208.75
12/ 1/ 1 38,740.00
6/ 1/ 2 640,000.00 4.050000 38,740.00 717,480.00 734,062.50 16,582.50 73,791.25
12/ 1/ 2 25,780.00
6/ 1/ 3 630,000.00 4.100000 25,780.00 681,560.00 698,125.00 16,565.00 90,356.25
12/ 1/ 3 12,865.00
6/ 1/ 4 620,000.00 4.150000 12,865.00 645,730.00 661,875.00 16,145.00 106,501.25
-------------- -------------- -------------- -------------- --------------
3,255,000.00 485,686.25 3,740,686.25 3,847,187.50 106,501.25
ACCRUED
3,255,000.00 485,686.25 3,740,686.25 3,847,187.50 106,501.25
Dated 9/ 1/98 with Delivery of 9/ 1/98
Bond Years 11,936.250
Average Coupon 4.069002
Average Life 3.667051
N I C % 4.205351 % Using 99.5000000
T I C % 4.218719 % From Delivery Date
Net Present Value Savings at: 4.0685% Equals 96,798.97 or 2.9739% of Par of the Current Issue
or 3.0976% of Par of the Prior Issue 4
Prepared by Evensen Dodge, Inc.
Micro-Muni Debt Date: 07-14-1998 8 13:54:15 Filename: AMES Key: REF
City of Ames, Iowa
$3,260,000 G.O. Refunding Bonds, Series 1998
Market a 07/14/98 Less 0.25% 11 Scale = 6/23/98 Sale
Sources and Uses of Funds
Delivery Date: 9/ 1/98
Sources of Funds
Par Amount of Bonds................... $3,260,000.00
+Premium /-Discount................... $0.00
Bond Proceeds........................................... 3,260,000.00
-------------------
$3,260,000.00
Uses of Funds
PV of Defeasance Requirements........................... 3,211,492.57
Cost of Issuance........................................ 30,000.00
Underwriters Discount...................( 0.500000%)... 16,300.00
Contingency............................................. 2,207.43
-------------------
$3,260,000.00
Prepared by Evensen Dodge, Inc.
Micro-Muni Sizing Date: 07-14-1998 a 14:08:52 Filename: AMES Key: REF-S
City of Ames, Iowa
S3,260,000 G.O. Refunding Bonds, Series 1998
Market a 07/14/98 Less 0.25% 11 Scale = 6/23/98 Sale
--------------
--------------
Savings Report
--------------
--------------
- - - - - - - - Proposed Debt Service - - - - - - - - Prior Cumulative
Date Principal Coupon Interest Total Debt Service Savings Savings
-------- -------------- ---------- -------------- -------------- -------------- -------------- --------------
12/ 1/98 30,808.75
6/ 1/99 65,000.00 3.400000 61,617.50 157,426.25 179,375.00 21,948.75 21,948.75
12/ 1/99 60,512.50
6/ 1/ 0 660,000.00 3.650000 60,512.50 781,025.00 804,375.00 23,350.00 45,298.75
12/ 1/ 0 48,467.50
6/ 1/ 1 650,000.00 3.750000 48,467.50 746,935.00 769,375.00 22,440.00 67,738.75
12/ 1/ 1 36,280.00
6/ 1/ 2 640,000.00 3.800000 36,280.00 712,560.00 734,062.50 21,502.50 89,241.25
12/ 1/ 2 24,120.00
6/ 1/ 3 630,000.00 3.850000 24,120.00 678,240.00 698,125.00 19,885.00 109,126.25
12/ 1/ 3 11,992.50
6/ 1/ 4 615,000.00 3.900000 11,992.50 638,985.00 661,875.00 22,890.00 132,016.25
-------------- -------------- -------------- -------------- --------------
3,260,000.00 455,171.25 3,715,171.25 3,847,187.50 132,016.25
ACCRUED
3,260,000.00 455,171.25 3,715,171.25 3,847,187.50 132,016.25
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Dated 9/ 1/98 with Delivery of 9/ 1/98
Bond Years 11,920.000
Average Coupon 3.818551
Average Life 3.656442
N I C % 3.955296 % Using 99.5000000
T I C % 3.967762 % From Delivery Date
Net Present Value Savings at: 3.8179% Equals 119,725.62 or 3.6726% of Par of the Current Issue
or 3.8312% of Par of the Prior Issue
Prepared by Evensen Dodge, Inc.
Micro-Muni Debt Date: 07-14-1998 a 14:D9:34 Filename: AMES Key: REFS
SENT BY 10- 9-08 � 9:42AM EVENSEN DODGE INC- 515 239 5325:# 3/ 3
J-I'__
City of Ames, Iowa
13,280,000 G.O. Refunding Bards, Series 1998
Uniform Savings 11 Market 8 10/06/98 11 Scale - 6/23/98 Sale
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Savings Report
. . . . . Proposed Debt Service - - - - - - - - Prior Cumulative
Date Principal Coupon Interest Total Debt Service Savings Savings
........ .............. .......... .............. .............. .............. ..............
121 1/98 14,791.88
6/ 1/99 80,000.00 3.250000 57,881.25 152,673.13 179,375.00 26,701.88 26,701.88
12/ 1/99 56,581.25
6/ 1/ 0 665,000.00 3.350000 56,581.25 778,162.50 804,375.00 26,212.50 52,914.38
12/ 1/ 0 45,442.50
6/ 1/ 1 655,000.00 3.450000 45,bb2.50 745,885.00 769,375.00 23,490.00 76,404.38
12/ 1/ 1 34,143.75
6/ 1/ 2 640,000.00 3.550000 34,143.75 708,287.50 734,062.50 25,775.00 102,179.38
12/ 1/ 2 22,783.75
6/ 1/ 3 625,000.00 3.650000 22,783.75 670,567.50 698,125.00 27,557.50 129,736.88
12/ 1/ 3 11,377.50
6/ 1/ 4 615,000.00 3.700000 11,377.50 637,755.00 661,875.00 24,120.00 153,856.88
------------ ............. .............. .............. --------------
3,280,000.00 413,330.63 3,693,330.63 3,647,187.50 153,856.88
ACCRUED
3,280,000.00 413,330.63 3,693,330.63 3,847,187.50 153,856.88
Dated 10/15/98 with Delivery of 10/15/98
Bond Years 11,529.111
Average Coupon 3.585104
Average Life 3.514973
N I C % 3.727353 % Using 99.5000000
T I C % 3.738025 % Fran Delivery Date
Net Present Value Savings at: 3.5833% Equals 140,992.93 or 4.2983% of Par of the Current Issue
or 4.5115% of Par of the Prior Issue
Prepared by Evensen Dodge, Inc.
Micro-Muni Debt Date: 10-07-1998 a 16:16:58 Filename: AMES Key: REF