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City hears analysis of possible refunding for three bond issues; potential long‑term savings estimated
Summary
Financial advisors presented preliminary analysis of refinancing three prior bond issues (streets LTGO, 2015 UTGO, and 2014 water/wastewater) and said timing will depend on market rates and a 1% net present value threshold in the ordinance.
City financial advisors told the Finance & Administration Committee they have opened a process to evaluate refinancing three outstanding municipal bond issues — the limited tax general obligation (LTGO), a 2015 UTGO that financed Riverfront Park improvements, and a 2014 water/wastewater issue that funded treatment and stormwater projects — and outlined projected savings that would be realized if market rates fall further.
Scott Bauer of Northwest Municipal Advisors summarized the refunding timeline and the types of savings the city could capture if they proceed. The process would prepare bond ordinances, an offering statement, ratings, and then a sale if market conditions meet thresholds set in the ordinance.
Key figures: Bauer said today—s net present value estimates total roughly $4.1 million across the three issues if all qualified. As of the presentation, the LTGO savings were small (about $115,000, roughly 0.2% of principal) and under the city—s 1% NPV threshold; the 2015 UTGO and the water/wastewater refunding showed larger NPV savings (about $1.5 million and $2.7 million respectively, roughly 2.4–2.6%). Committee members were told the city will not extend final maturities and that any refinancing would preserve original final maturity dates.
How savings would be used: Officials emphasized that NPV savings are realized over the life of the bonds and are not an immediate cash deposit. Matt Boston and city staff said departments that back the debt (parks and utilities) would discuss how to allocate annual debt‑service savings and that the administration plans internal thresholds (roughly 3% historically used) and department conversations to determine use of savings.
Next steps: Staff and the advisors said draft ordinances appear in committee packets and will return for an advance briefing April 14 and full council action April 21. Advisors said they will continue market monitoring and only proceed to sale when the CFO and administration approve execution.
