Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
Kingman council approves up to $11.11 million in excise-tax obligations to fund Santa Rosa transmission main
Summary
On April 1, the Kingman City Council authorized the city to issue excise tax revenue obligations to finance the Santa Rosa transmission main, reimburse an internal loan for the Rancho Santa Fe interchange and cover issuance costs; the city reported a Standard & Poor's 'AA' rating and said water ratepayers will fund debt service.
The Kingman City Council on April 1 approved Resolution No. 5,550 authorizing the issuance of excise tax revenue obligations of up to $11,110,000 to fund the Santa Rosa transmission main and reimburse a capital projects advance for the Rancho Santa Fe Parkway traffic interchange.
Council and staff said the Santa Rosa transmission main will move water from the west side of Route 66 to the east side. The council was told the construction contract was awarded in December 2024 at a guaranteed maximum price of $7,100,000 and that $3,200,000 was borrowed from the capital projects fund earlier; the issuance will reimburse that internal loan if approved as planned.
City Manager Tina Walsh outlined the documents the council was authorizing: a trust agreement, a continuing disclosure certificate required by the U.S. Securities and Exchange Commission, an obligation purchase (underwriter) agreement, and a preliminary official statement for investors. Walsh told the council the city engaged Columbia Capital as financial adviser, Stifel as underwriter, and Gus Rosenfeld as special counsel. She said the city expects to market the obligations in April and sell them in May, with proceeds deposited with the trustee by May 22.
Walsh said the issuance is structured as a 20-year obligation and that, although some general-fund revenue is pledged for the paperwork, the city intends for water ratepayers to pay the debt service on the Santa Rosa transmission main. She also told the council the city had engaged Standard & Poor's and “we received a double A credit rating, which is almost the highest rating that you can receive,” a rating she said should lower the interest rate the city receives in the market.
The council moved, seconded and voted to approve the resolution. The motion carried with the ayes recorded and no opposing votes announced.
The city clerk will complete final execution of the documents and staff said proceeds that exceed immediate project needs or issuance costs will be placed into reserves or used toward future debt service, per the issuance documents discussed with the underwriters.
The council did not set a new water rate during the meeting; Walsh said the cost of this debt was already built into the city's adopted rates through at least fiscal year 2030. The timetable presented to the council shows marketing, sale and deposit of proceeds in April–May 2025 and later disbursements handled through a trustee.
