Laserfiche WebLink
Debt Issuance Service <br />Therefore, IRS rules regarding the amount of interest that the City may <br />earn on bond proceeds is more of a concern. Because the City is issuing <br />less than $5,000,000 in this calendar year (GO Improvement Portion of the <br />Bonds), the proceeds can earn interest without restriction for three years. <br />The City will also need to keep its debt service funds within IRS <br />parameters to avoid penalties on carrying too high of a balance during the <br />life of the issue. <br />It should be noted that pre -paid special assessments may cause the Debt <br />Service Fund to be higher than IRS parameters. <br />Rating: It is anticipated that Standard and Poor's will rate the Bonds a "AA". <br />Bank Qualification: Because the City is issuing less than $10,000,000 in the calendar year, the <br />City will be able to designate the Bonds as "bank qualified" obligations. <br />Bank qualified status broadens the market for the Bonds, which can result <br />in lower interest rates. <br />Term/Call Feature: GO Improvement Portion of the Bonds. This portion of the 2011A Bonds <br />are being issued for a 15 -year period plus six months of capitalized <br />interest. Interest is payable each six months thereafter beginning August 1, <br />2012. Principal on this portion of the 2011A Bonds will be due on <br />February I in the years 2013 through 2027. This portion of the 2011A <br />Bonds maturing February 1, 2022, and thereafter will be subject to <br />prepayment at the discretion of the City on February 1, 2021. <br />GO .Refunding Portion of the Bonds. This portion of the 2011A Bonds will <br />retain the same repayment period as the 2003A Bonds. Principal on this <br />portion of the 2011A Bonds will be due on February I in the years 2012 <br />through 2019 and will be non -callable. <br />Other We have reviewed all outstanding indebtedness for the City and have <br />Considerations'. found that the 2004A and 2005A will be current refunding opportunities <br />for later this fall and will likely produce appropriate savings for the City. <br />We will review the opportunity for refunding these issues later this year <br />and discuss their feasibility with staff. <br />'resale Repoil <br />FebrUary 22, 20-H <br />Naga :, <br />