Authorization of Resolution #11-12-XXX Accepting Sale of $3,090,000 General Obligation Improvement Crossover Refunding Bonds, Series 2011B

In 2005 the City issued $4,335,000 General Obligation Improvement Bonds with an average interest rate of 4.41%.  Given current market conditions, the proposed bond sale would net a savings of approximately $186,000 with an average interest rate of 2.30%.  The savings is net of all costs and would be realized through the term of 2025.

The September 27, 2011 Finance Committee and October 10, 2011 City Council meeting authorized the issuance of refunding bonds to take advantage of lower interest rates.  The actual sale is being brought forward at this later date, as the market had fluctuated and the net savings to the city fell substantially.  By waiting, the city was able to achieve an appoximately $14,000 in additional savings on debt service costs.

Annually, the city receives payment from Anoka County to cover debt service on the current issue.   The payment schedule is documented in the JPA between the City and County in regards to the AUAR improvements in the COR project area.

Debt service is covered by an annual appropriation from the County.

Motion to recommend that Council adopt Resolution #11-12-XXX Accepting Proposal on the Negotiated Sale of $3,090,000 General Obligation Improvement Crossover Refunding Bonds, Series 2011B.