New Ulm council approves award of 2025 general obligation bond sale after Moody’s reconfirms AA2 rating

The New Ulm City Council voted Tuesday to authorize issuance and award the sale of its 2025 general obligation bonds and to accept Moody—s reconfirmation of the city—s AA2 rating.

City finance staff and municipal finance advisor John Burmeister of PFM reported that the city solicited proposals for $5,300,000 in general obligation bonds, series 2025, and received eight bids. Burmeister said the winning bid recommended was from Piper Sandler of Minneapolis at a true interest cost (TIC) of about 3.563 percent, with an adjusted par amount reported in the presentation as $4,000,009.30 after applying premiums. Burmeister said the city—s AA2 rating and the bond size attracted competitive interest from underwriters across the country.

The council also received a staff report that Moody—s Investors Service had reconfirmed a double-A2 rating for the city—s series 2025 general obligation debt, noting stable finances, a strong fund balance, low unemployment and steady local economic activity.

In action, the council approved a resolution authorizing issuance, awarding the sale and fixing the form and details for the general obligation bond series 2025 and authorizing city officials to execute bond documents on behalf of the city. Director Jorgensen called the roll; Councilors Christian, Schmitz, Mack and Womack voted yes and the motion carried.

Councilors asked staff to confirm the final par amount and to reflect the premium adjustments described in Burmeister—s report in the final bond documents. Burmeister also reported Moody—s would lower the city—s fee by $6,500 after the final par crossed a pricing threshold.

The bonds were described in the staff report as financing various municipal street, alley and airport improvements. Council discussion was limited and centered on confirming the corrected par amount for the bond documents and the competitiveness of received bids.