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Beltrami County approves $33.715 million bond sale to finish jail project
Summary
The Beltrami County Board approved a $33.715 million general obligation bond sale to fund remaining construction of the county jail; advisers reported lower-than-expected borrowing costs and projected debt-service averaging about $2.58 million a year to be paid from local option sales tax.
Beltrami County commissioners on Monday approved a resolution awarding $33,715,000 in general obligation bonds to fund the final phase of the county jail project.
Bruce Kimmel of Eller’s, who presented the sale-day report, said the county received eight bids and accepted a winning syndicate bid from Raymond James with a true interest cost of about 3.68%. "The final bond amount is $33,715,000," Kimmel said, adding that yields on the bonds ranged roughly from 2.26% to 4.3% and the sale produced roughly $2.7 million in premium that was applied to lower the par amount.
Kimmel summarized the financing terms the board approved: the bonds carry an eight-year call feature, and debt service is projected to average about $2,575,000 per year. He told commissioners the county will repay the bonds with local option sales tax revenues already being used to pay other county debt service.
The presentation also compared the current two-issuance approach to an earlier plan to issue a single larger bond. Kimmel said splitting the issuance and shortening the second bond term from 25 years to 20 years will reduce total interest costs over the life of the borrowing and yielded what he estimated as about $12 million in lifetime savings versus the original single-issuance approach.
Commissioner Mister Carlson moved to adopt the resolution "to provide for the issuance, sale and delivery of $33,715,000 general obligation jail bonds;" the motion was seconded and the board approved the resolution. The transcript records the motion and the chair’s announcement that the resolution was "approved," but it does not contain a detailed roll-call vote tally.
The county also received an affirmed AA stable local rating and a state-level credit enhancement that Kimmel said helped attract competitive bids. Kimmel and staff told commissioners the county’s loss and surplus balances were factored into the sources-and-uses schedule for project costs and debt service.
The board distributed a revised resolution at the meeting reflecting the sale-day numbers and asked staff to file the official closing documentation following the sale.
Next procedural steps: the bond award will be closed and delivered according to the terms in the resolution; no additional board action was recorded at the meeting to change the financing plan.
