Financial adviser: Wells Fargo submitted low Series B bond bid; district retains $60.36M for capital projects
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Summary
The district's financial adviser reported eight bids for the Series B construction bonds with the low bid from Wells Fargo near 4.556%; the district will receive about $60.36 million for projects and must spend proceeds on capital within three years under arbitrage rules.
Scott Beardsley, the district's financial adviser, briefed the board during a workshop on bids for the district's Series B construction bonds, saying the district received eight bids and the low bidder was Wells Fargo at approximately 4.556%.
Beardsley explained that a defeated millage referendum does not change previously approved millage collections unless an increase is requested, and reviewed how the district modeled interest rates prior to recent market volatility. He told the board that the low bid was "Wells Fargo at 4.556007" and that other bids clustered above that (cover bid from Carty 4.605, JPMorgan 4.638, etc.).
Beardsley also told the board the paragraph-transfer balance of $60,360,287.35 will flow into the district's account at month-end and must be spent on capital projects consistent with what voters approved; 10% must be spent within six months and the remainder within three years, and bond proceeds cannot be used for salaries or recurring operating costs.
Board members asked about term length (confirmed as 30 years) and whether the district is required to use a specific bond attorney; Beardsley said the legal fees will be broken out under new municipal adviser rules and the district would be free to select a different firm if it chose to do so in future contracts.
Ending: Beardsley said staff will provide the district's debt schedule at a regular meeting and present official motions for formal board action.