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Council authorizes RFP for interim financing to bridge PENNVEST loan for wells-and-mains project
Summary
Concord Public Finance recommended refinancing a $1.7M interim note (2022 series C) to a 2026A note and creating a $1.5M drawdown construction loan; council authorized an RFP to banks and will consider ordinance action in March.
Lock Haven's council authorized staff to issue a request for proposals seeking interim financing to bridge the city's wells-and-mains project to a PENNVEST loan, after a presentation by Darryl Peck of Concord Public Finance.
Peck explained that the city's 2022 general obligation bond series C (about $1.7 million) will mature on April 1, 2026, and recommended issuing a 2026A note to extend maturity as late as Aug. 1, 2027, with prepayment allowed. He also recommended a second, drawdown series B loan of about $1.5 million to provide construction-phase liquidity and cover PENNVEST retainage and reimbursement timing.
"The 2022 C bond matures on 04/01/2026 ... so you're basically gonna need to refinance or restructure that note," Peck said, recommending the 2026A note for the outstanding $1.7 million and a $1.5 million drawdown loan to use only as needed during construction.
Peck outlined a schedule: issue an RFP to banks (he cited a sample outreach to about 30 banks), gather proposals, consider a first-reading ordinance at the March 2 meeting (and a potential special meeting on Feb. 16), and return to council with recommended proposals for final action. He cautioned that PENNVEST disburses on a reimbursement basis, so interim liquidity is required to pay contractors and be reimbursed later.
Council moved and seconded a motion to proceed with the RFP for interim financing; the motion passed by roll-call vote as recorded in the meeting transcript.
Next steps: Staff and Concord Public Finance will circulate the RFP, collect proposals (Peck said proposals could be targeted to return by Feb. 24), and present options to council for formal ordinance action on March 2.
