Hibbing council approves $19.77 million interim bond sale to fund public safety facility

The Hibbing City Council on Oct. 22 approved awarding an interim bond sale worth about $19.77 million to Baird to provide interim financing for a new public safety facility, with closing scheduled for Nov. 5. Ehlers told the council the transaction is structured as short-term, interest-only bonds intended to be refinanced within one to three years.

Nick Anhut of Ehlers said the city received four competitive bids and recommended awarding the sale to Baird, which offered the lowest cost. “Their indicated rate was, 3.144, percent,” Anhut said, and he told the council that with the pricing the borrowing amount could be reduced by roughly $70,000 from the original presale authorization. Anhut also reported that Standard & Poor’s affirmed the city’s AA long-term rating and assigned an SP-1+ short-term rating for the transaction.

The bonds are intended to be repaid from the new local-option sales tax and the annual interest-only payment in 2026 was estimated at about $586,000. Anhut said the structure gives flexibility to refinance next year if market conditions allow. The sale documents were updated by the city’s bond attorneys to reflect the winning bid and the council approved the recommendation to award to Baird on a motion by Councillor Bayless with support from Councillor Hildebrand; the motion carried.

The council’s action authorizes the city to accept the bid and proceed to closing and to use the state funds set aside for the project when available. The next procedural step is the scheduled closing and wire of funds on Nov. 5, after which the interim financing will be available for construction work on the public safety facility.