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Monona approves $3.15 million notes; financial adviser cites low rates and net premium
Summary
The council authorized issuance of $3,150,000 in general obligation promissory notes (Series 2026A). The city's financial adviser reported a successful sale, an issuance premium of roughly $220,000 and a true interest cost near 3.61% at closing, with effective borrowing cost likely lower after fund earnings.
The Monona Common Council authorized the sale of $3,150,000 in general obligation promissory notes (Series 2026A) to fund 2026 capital priorities.
Finance staff (Mark) and the city's financial adviser, Jeff Balange, presented sale results. Balange said the transaction produced enough to cover issuance costs and left a net premium of a little over $220,000 to offset the first interest payment. He summarized yields by maturity and said the condensed true interest cost at closing was about 3.61%, while noting that earnings on the construction fund would likely reduce the effective cost closer to the mid-2% range over time.
The council asked about buyers; Balange said institutional investors including large firms participated and offered to send a buyer list to staff. Following a motion and second, the council approved the borrowing by roll call vote.
