HomeMy WebLinkAboutA026 - Council Action Form dated July 27, 2021 ITEM # 12
DATE: 7/27/2021
COUNCIL ACTION FORM
SUBJECT: RESOLUTION APPROVING OFFICIAL STATEMENT FOR GENERAL
OBLIGATION CORPORATE PURPOSE BONDS, SERIES 2021A,
SETTING DATE OF SALE FOR AUGUST 10, 2021, AND AUTHORIZING
ELECTRONIC BIDDING FOR THE SALE
BACKGROUND:
The FY 2021/22 Budget includes General Obligation (G.O.) Bond-funded capital
improvement projects in the amount of $11,055,400. The City Council held a public
hearing on the issuance of these bonds and for the refunding of bonds on February 23,
2021. Council action is now required to approve the official statement, set the date of sale
for August 10, 2021, and authorize electronic bidding.
The Official Statement, or "Preliminary Official Statement," is the offering document for
municipal securities, in preliminary form, which does not contain pricing information. The
Statement provides several financial disclosures and information about the City. This
"Preliminary Official Statement" is on file in the City Clerk's Office and is attached to this
report.
Additionally, Council is asked to approve electronic bidding as the method to provide a
secure and highly competitive process for the sale of the bonds. The proposed issuance
is in compliance with the City Council approved debt policy.
Projects to be funded by this bond issue include the following:
Arterial Street Pavement Improvements (N. Dakota/Ontario) $ 800,000
Collector Street Pavement Improvements (Hoover Avenue) 2,400,000
Concrete Pavement Improvements 3,500,000
Asphalt Street Pavement Improvements 2,500,000
Seal Coat Pavement Improvements 750,000
Downtown Pavement Improvements (Duff to Sherman Alley) 245,000
Intelligent Transportation System 160,400
Downtown Plaza -General Corporate Purpose- 700,000
Subtotal Tax Supported Bonds $11,065,400
Refunding Bonds 11,056,000
Estimated Issuance Costs 294,600
Grand Total—2021/22 G.O. Issue $22,405,000
1
To take advantage of current lower interest rates, this authorization to sell bonds also
includes the current refunding of the Series 2013 G.O. Bond issue. It is estimated that
this refunding will yield approximately $900,000 in present value savings to the City, or
an approximate 8% reduction in total debt service cost over the life of the bonds. Our
policy target for current refunding is a 3% reduction in debt service.
ALTERNATIVES:
1. Approve the Official Statement for General Obligation Corporate Purpose Bonds,
Series 2021 A, setting the date of sale for August 10, 2021, and authorize electronic
bidding for the sale.
2. Refer the Official Statement back to City staff for modifications.
CITY MANAGER'S RECOMMENDED ACTION:
Issuance of these bonds is necessary in order to accomplish the City's approved Capital
Improvements Plan for the current fiscal year and savings can be realized by bond
refunding.
Therefore, it is the recommendation of the City Manager that the City Council adopt
Alternative No. 1 as stated above.
2