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22 22: <br /> REQUEST FOR COUNCIL CONSIDERATION Agenda Section: 2. <br /> Report Number: 93-452WS <br /> STAFF REPORT111706 <br /> AGENDA SESSION DATE April 5, 1993 Report Date: 4-1-93 <br /> DISPOSITION <br /> Item Description: Consideration of Issuance of Advanced Refunding Bonds <br /> Administrator's Review/Recommendation: <br /> - No comments to supplement this report <br /> - Comments attached. 1' <br /> Explanation/Summary (attach supplement s Bets as necessary.) <br /> FUMMARY% <br /> Bob Thistle of Springsted, our financial advisory firm on bond issues, <br /> will be present at the April 5, 1993 Council Work Session to discuss the <br /> feasibility of advance refunding two City bond issues. Advance <br /> refunding is the issuance of bonds to pay off outstanding bonds before <br /> their due date. A cost savings is realized because the new(refunding) <br /> bonds are issued at a lower interest rate than the old(refunded) bonds. <br /> Attached is a copy of Mr. Thistle's recommendations. The bond issues <br /> being considered are: <br /> • General Obligation Water Revenue Bonds, Series <br /> 1991A($2,875, 000) <br /> • General Obligation Tax Increment Bonds, Series 1989B($930, 000) <br /> Mr. Thistle's recommendations outline the advance refunding procedures <br /> and provide an analysis of each issue being considered for advance <br /> refunding. Basically what is being proposed is capsulized in the <br /> following paragraphs. <br /> The net interest rate on the callable maturities of the General <br /> Obligation Water Revenue Bonds, Series 1991A is 6.77%. Based on current <br /> market conditions it is estimated that refunding bonds could be issued <br /> at a net interest rate of 5.37% which would result in a total savings of <br /> $166, 000. <br /> The net interest rate on the callable maturities of the General <br /> Obligation Tax Increment Bonds, Series 1989B is 6.71%. Based on current <br /> market conditions it is estimated that refunding bonds could be issued <br /> at a net interest rate of 4 . 69% which would result in a total savings of <br /> $42, 900. <br /> RECOMMENDATION: Don Brager, Fin ce Director-Treasurer <br />