Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
Council committee schedules bond/note rollover ordinance for Feb. 11; finance staff outline plan to pay down notes
Summary
Finance staff and outside counsel recommended rolling over one-year notes due April 3 while applying a planned $350,000 paydown; council committee approved placing a bond/note renewal ordinance with emergency on the Feb. 11 agenda.
Finance staff and outside legal and financial advisers told the council finance committee on Jan. 28 that the city plans to roll over short-term notes coming due April 3, 2025, while applying a budgeted paydown, and the committee voted to place the ordinance on the Feb. 11 meeting agenda with an emergency designation.
Director Frank introduced bond counsel Catherine Schwartz and a finance advisor, who said the city budgeted $350,000 to pay down outstanding notes and typically rolls over one-year notes rather than issue long-term bonds at the current scale. Catherine Schwartz, bond counsel, told the committee the legislation is similar to last year's and that notes may be rolled for another year while the city retains flexibility "to go to bonds" at a later time.
Bond counsel said legal compliance is governed by the Ohio Revised Code and federal tax law: "Everything we do as it relates to debt issuance here at City of 7 Hills must comply with the Ohio revised code, federal tax law, and state law." The advisers said $3,795,000 in notes plus interest are due April 3 and that the plan has been to roll the notes while paying down available amounts.
A finance advisor said the city is monitoring the net interest margin between borrowing costs and investment returns. He noted that notes were being priced in the low to mid 3.5 percent range while investments such as STAR Ohio were returning roughly 4.5 percent; that dynamic informed a strategy of retaining some cash to invest when the carry is favorable. He said the team would revisit the strategy if market rates change and could accelerate paydown if conditions warrant.
The committee approved putting the bond/note renewal ordinance on the Feb. 11 council agenda with emergency after a motion; the roll call recorded Mara yes and Curiosus yes. Staff said the legislation language largely follows the prior year's structure, with a maximum maturity referenced for long-term bonds if the city chose to convert.
What happens next: the ordinance will be on the Feb. 11 agenda with emergency and, if approved, the city will continue the plan of rolling short-term notes while applying budgeted paydowns and monitoring market rates to determine whether to accelerate debt reduction or convert to bonds.
