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Executive Summary of Proposed Qebt <br />Proposed Issue: <br />Purpose: <br />Authority: <br />Term/Call Feature: <br />1577i.00I Goneral Obligation Refunding. Bonds, Scries 20I5A <br />TO crossover .reliritd the C:ity':s ouisiandi.ng Gellera.l Obligation Capital <br />InIPravelnenf Plan tie n(k.,, .Series ?OU7A l >:r:an irueresccostsavings. <br />Debt service will he paid thorn od valpretn property tu.xcs. <br />Interest raieti on the itE; i_. 1tiiJnS proposed to be refunded. are 4.00% to 3:50%. <br />'f]I" Til:iti e,\I)CClCd TO redilce illtc.resi expense by approximately <br />S6S,30.", over the next 1.3 )cars. The Net. Present Value Benefit of the <br />refunding is csliniate:-t to be `y60.39.3, equal to 8.2.73% of the -rellgrided <br />Pr. <br />ne.i.pal. <br />This refunding, is coo idered an -advance' refunding as the new Bonds.will be <br />issued 111ore .tharl 00 clays prior to the call date of the obligations being <br />rcflitld.d. <br />Bond:are (}L1r.SWInt to .Minnesota Statutes. Chapter475. <br />I The Bolick will 1w genetll obli-adonis of the Cify !or which its full faith, credit <br />l and t1a.xi , powers are p€edpeci_ <br />The Boild;. are beint, issuei for a 13=year terin. Principal. on the Bonds will :be <br />date on I-ebruary I in the dears 2017.through 20.28. Interest is payable every <br />six niorlths beginnillr, Fcbrt. ary 1. 2016. <br />The Bonds inaturim,, on and after Februxry 1; 2025 will be subject to <br />prepaiynicnt of the discretiotl of the City on February 1, 2Q24 or any .date <br />tlierdaf'ter. <br />Bank Qualification: B3�call etile t: its, r:. i";Llh;� less Than S f 11.Iiflrl.hfl(t in tlic calendar Year. the City <br />ill 11c� able to dcsi`t..11al,� the Bonds zis "bank- qualified" obligations, flank <br />rfUldi[M] SIZILls.bl'O_CICI tllc market IiUr the 13orids, which ,,an result h1*1 ewer <br />j intt'rest rates, <br />Rating: 11 i I c commend selling this issue non -rated as the cost of the rating would not. <br />he expected to be: rrITWI by the potential Battier interest rates. resulting.:fiom <br />lztiiillin�1 as rarin �.. i tit' it bond issue., a r1aiing might broaden the market <br />j for the Bonds. and restift In all ()V eralI NdLlC.t.i011 ill inLQ1TS1 COOLS. <br />Basis for Recommendation' 1 13as6d on our kn(. t, ledge of om situation. your tiiijeciive5 .cotzlinunic<tied to <br />u}, .c,}utr lclvitic ry lClIvionship a; well as .charitc.lelistles .Of varodus municipal <br />financing optioll�.. v.e are recommending the issuatiae of general obligation. <br />1 bands as a suitable firilancing option because the City's policy and past practice <br />hits been to rcfin lace .0 tstanciill ;.bonds with this type of debt issue, and there <br />are linliwd other options available to finance -these iypcs.arbonds. <br />Presale Report <br />City of Gem Lake, Minnesota <br />April 21, 2015 <br />Page i <br />