HomeMy WebLinkAboutA024 - Council Action Form dated August 25, 2015, Item #37 ITEM # 37
DATE: 8-25-15
COUNCIL ACTION FORM
SUBJECT: SALE AND ISSUANCE OF ESSENTIAL CORPORATE PURPOSE
GENERAL OBLIGATION BONDS SERIES 2015A ISSUE IN AN
AMOUNT NOT TO EXCEED $21,345,000
BACKGROUND:
The 2015/16 budget and Council-approved changes include General Obligation (G.O.) Bond-
funded capital improvement projects in the amount of $14,253,975. The City Council held public
hearings on the issuance of these bonds and refunding bonds on March 3, 2015, as part of the
budget process, and on July 14, 2015, to include an additional amount for the Grant Avenue
extension project. Council action is now required to authorize the sale.
Projects to be funded by this bond issue include the following:
East Industrial Area Sewer Extension $ 2,000,000
ISU Research Park Improvements 2,938,990
Grant Avenue Extension (Assessment) 360,985
Airport Terminal 943,000
Debt to be Abated by Other Revenues $ 6,242,975
Flood Mitigation $ 144,000
West Lincoln Way Improvements 450,000
Asphalt Street Improvements 1,300,000
Grand Avenue Extension 280,000
Concrete Pavement Improvements 1,100,000
Arterial Street Pavement Improvements 400,000
Downtown Street Pavement Improvements 800,000
Seal Coat Pavement Improvements 350,000
Bridge Rehabilitation Program 2,320,000
Airport Terminal Building 867,000
Subtotal Tax Supported Bonds $8,011,000
Refunding Bonds 5,950,000
Issuance Cost and Allowance for Premium 1,141,025
Grand Total Not to Exceed -2015116 G.O. Issue $21,345,000
On the morning of August 25, 2015, the City will accept bids for the bonds per the terms
of our offering statement. The bids will be evaluated by our financial advisor, Public
Financial Management, by the City's Bond Counsel, and by City staff to recommend
award to the bidder with the lowest cost. A report of bids will be provided to Council at
the August 25 meeting. The City Council will then be asked to adopt a resolution
accepting bids and authorizing that the sale of bonds be awarded to the chosen bidder.
ALTERNATIVES:
1. The City Council can adopt a resolution accepting bids and authorizing the sale and
issuance of Essential Corporate Purpose General Obligation Bonds in an amount not to
exceed $21,345,000.
2. The Council can reject the bond sale resolution and delay the capital projects.
MANAGER'S RECOMMENDED ACTION:
Issuance of these bonds is necessary in order to accomplish the City's approved capital
improvements during this fiscal year and savings can be realized by bond refunding.
Therefore, it is the recommendation of the City Manager that the City Council accept Alternative
No. 1, thereby adopting a resolution accepting bids and authorizing the sale and issuance of
Essential Corporate Purpose General Obligation Bonds in an amount not to exceed
$21,345,000.
The City Council should be reminded that this bond issue includes $2,000,000 to extend
a sanitary sewer line just east of Highway 35 along Lincoln Way. This project will help
facilitate the development of the East Industrial Area annexation which is a priority of the
City Council. It was hoped that the issue regarding which entity would be supplying
water to this area (the City of Ames or the Central Iowa Water Association (CIWA)) would
be resolved prior to moving ahead with this project. While progress has been made in the
negotiations between City staff and representatives from the CIWA, an agreement has
not yet been finalized. Rather than omit this project from this bond sale which will result
in a one year delay in starting the project, the action tonight will borrow $2,000,000 to
finance this sanitary sewer extension. Even under the worst case scenario where the
City Council decides not to annex and extend infrastructure into this area, these
borrowed funds can be used to finance street projects planned for in second year of the
CIP. This action will allow the City to issue fewer bonds in FY 2016/17.
�De a� k Parity Calendar Deal List
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FTN Financial Capital Markets-New York, NY's Bid :,4y����j
Ames
$20,085,000 General Obligation Corporate Purpose and
Refunding Bonds, Series 2015A
For the aggregate principal amount of$20,085,000.00.we will pay you$21,678,720.00,plus accrued interest from the date of issue to the date of delivery.The
Bonds are to bear interest at the following rate(s):
Maturity Date Amount$Coupon%Yield%Dollar Price
06/01/2016 2,260M 5.0000 0.3500 103.209
06/01/2017 2,575M 5.0000 0.6600 107.288
06/01/2018 2,670M 5.0000 0.9700 110.680
06/01/2019 2,155M 5.0000 1.1500 113.874
06/01/2020 1,130M 5.0000 1.4000 116.290
06/01/2021 1,155M 2.0000 1.7000 101.619
06/01/2022 1,195M 5.0000 1.9000 119.390
06/01/2023 1,215M 5.0000 2.0000 121.286
06/01/2024 1,250M 2.5000 2.2000 102.110
06/01/2025 1,295M 3.0000 2.5000 103.476
06/01/2026 1,340M 3.0000 2.7000 102.068
06/01/2027 1,380M 3.0000 2.9000 100.682
06/01/2028
06/01/2029 105M 3.0000 3.0000 100.000
06/01/2030
06/01/2031 110M 1 3.0000 3.12001 98.517
06/01/2032
06/01/2033 120M 3.1250 3.2300 98.590
06/01/2034
26/01/2035 130M 3.2500 3.3000 99.277
Total Interest Cost: $4,116,018.13
Premium: $1,593,720.00
Net Interest Cost: $2,522,298.13
TIC: 2.145498
Time Last Bid Received On:08/25/2015 10:59:54 COST
This proposal is made subject to all of the terms and conditions of the Official Bid Form,the Official Notice of Sale,and the Preliminary Official Statement,all of
,which are made a part hereof.
!Bidder: FTN Financial Capital Markets,New York,NY
(Contact: Vincent Pietanza
;Title: Senior Vice Presiden
I Te l e p h o n e:212-418-5 0 0 5
!Fax: 212418-7999
Issuer Name: City of Ames Company Name:
Accepted By: d-41acepted By:
Date: � ✓�� Date:
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