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REQUEST FOR COUNCIL ACTION Date: 10/23/00 Item No.: F-6 Department ApprovaL ManagerReviewed Agenda Section Reportsand � � ��' Recommendations Item Description: Full Call of General Obligation Improvement Bonds, Series 18 Background In a timely manner, city staff reviews outstanding debt for either refunding or calL The refunding depends on the level of interest rates and whether savings can exceed 3% or better. At current interest rates, refunding becomes either very marginal or not within the statutes of savings. Bond ca11s depend on how well assessments have been paid on specific bond issues, whether the ca11 date is current and whether sufficient assets are on hand to institute the call. We have reviewed the Series 18 issue and have determined that a full call of the remaining bond issues can be made. The maturities being recommended for call are: Year Interest Amount 2002 5.75% 160,000 2003 5.80% 165,000 This ca11, which will be effective on March 1, 2001, will provide for significant interest cost savings of $18,770 on an annual basis and will decrease our proj ected 2001 total outstanding debt by $325,000 or appro�mately $10 per capita. Financial Implications The funds to be used are derived from revenues specifically received from the projects financed by Series 18 and are reserved for payment of debt service only. There will be no effect on the City's general operating budget except that future interest obligations will be decreased. Policy Objective The City's Debt Policy provides that refunding or refinancing may be undertaken when the economic advantage is significant to the City (Policy Debt Policies). As outlined within the background and fmancial implications sections, calling this bond issue will provide a significant economic advantage. Staff Recommendations Staff is recommending that the City Council approve the attached resolution, prepared by the City's bond counsel.