Discussion and possible action on any and all matters regarding Resolution No. 2304. A resolution of the Mayor and City Council of the City of San Luis, Arizona, approving the sale, execution, and delivery of pledged excise tax revenue refunding obligations, series 2024; approving the form and authorizing the execution and delivery of necessary agreements, instruments, and documents; delegating authority to determine certain matters with respect to the foregoing; and declaring an emergency.  (Mark Reader, Managing Director at Stifel, Nicolaus & Company, Inc.)

(6 votes in favor are required in order to pass immediately as an emergency measure per A.R.S. § 19-142)

This item is to approve the refunding of the Bonds Series 2014A to take advantage of lower interest rates and achieve substantial savings for the city, enhancing the city's financial stability and freeing up resources for other critical projects and services for the city's residents. The exact savings will be determined based on the prevailing market rates at the time of the transaction but are anticipated to be significant based on Stifel's preliminary analysis. It is to be passed as an emergency so that the bonds may be on the market at the an advantageous interest rate.

The 2014A Bond Series is secured by Pledged Revenue derived from Excise Taxes. Stifel, our underwriter, has conducted a comprehensive analysis of our outstanding debt portfolio and identified the 2014A Series as a prime candidate for refunding due to its callable feature and the current favorable interest rate environment.

Stifel has conducted a comprehensive analysis of the estimated savings opportunities for our outstanding debt. Key points of consideration are:

• Interest Rate Environment: Current market conditions present a significantly lower interest rate compared to the rates at which the 2014A Bonds were originally issued. Refunding these bonds under the lower rates will decrease our interest payments and increase savings over the life of the bonds.

• Callable Feature: The 2014A Bond Series includes a provision that allows for these bonds to be called and refunded on a tax-exempt basis. This provision becomes actionable for a current refunding transaction closing on or after April 2, 2024, with the call date of July 1, 2024, or sooner.

• Estimated Savings: Preliminary analysis by Stifel projects considerable savings opportunities through the refunding process. While specific figures will be dependent on market conditions at the time of the transaction, the strategic timing of this refunding is expected to maximize savings.

The exact savings will be determined by the prevailing market conditions at the time of the issuance of the refunding bonds. However, preliminary estimates suggest that the city stands to achieve significant savings in debt service payments, enhancing our fiscal flexibility and ability to allocate resources to other critical needs of the city.

The item is now before the City Council for consideration and possible adoption of a resolution approving the form and authorizing the refunding of the 2014A Bond Series. This authorization will empower the Acting City Manager, Acting Finance Director, and other designated officials to execute agreements, contracts, and other documents necessary to complete the refunding transaction.