Title
Consideration of and action on an ordinance amending the Fiscal Year 2015-2016 Budget for the Limited Tax Refunding Bonds, Series 2016.
Body
Summary: The Fiscal Year 2015-2016 Budget included a proposed debt issuance for new money bonds to fund water and sewer projects included in the City’s ten-year capital improvement plan. During the fiscal year, favorable market conditions provided the City an opportunity to achieve interest cost savings by issuing refunding bonds. The City issued the $6,260,000 Limited Tax Refunding Bonds, Series 2016 to refund $5,040,000 of the outstanding Certificates of Obligation, Series 2007 and $1,440,000 of the outstanding General Obligation Bonds, Series 2007 for interest cost savings of approximately $710,000. At closing, the City received $6,260,000 of bond proceeds plus a premium for a total $6,800,737. The City deposited $6,710,040 into the escrow account to defease the refunded debt obligations. Because a refunding was not contemplated as part of the Fiscal Year 2015-2016 Budget, the budget does not reflect an expenditure for the escrow deposit. A budget amendment in the amount of $6,710,040 is necessary to recognize the payment to the escrow agent.
Fiscal/Budgetary Impact:
Include the $6,710,040 payment to the escrow agent in the Debt Service Fund (Account No. 20-900-4524, Payment to Escrow Agent) with the offsetting revenue from the proceeds of the refunding bonds, including the net premium on the bonds.
Recommended action
Approve the ordinance amending the 2015-2016 Budget for the Limited Tax Refunding Bonds, Series 2016.