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Huntsville council approves four‑series warrant issuance; officials say refinancing will net $5.9 million
Summary
The City Council voted to authorize four series of general‑obligation warrants and refunding warrants after staff and bond counsel described a competitive sale that yielded a 3.65% all‑in yield and estimated $5.9 million in net present‑value savings across the city and Huntsville City Schools.
Huntsville’s City Council on March 12 approved an ordinance authorizing the issuance of four series of general‑obligation warrants and refunding warrants for the city and Huntsville City Schools, citing a competitive sale that officials said produced favorable market rates.
City financial advisor Josh McCoy told the council the competitive sale drew nine bids and that the winning purchase offer produced an all‑in investor yield near 3.65% (3.68% all‑in cost to the city). McCoy said the transaction will refund just under $60 million in warrants and deliver an economic net present‑value savings of roughly $5.9 million — about $2.4 million to the city and $3.5 million to the school system. “We received 9 bids … and awarded verbally the bonds to Wells Fargo, who provided the lowest all in true interest cost at roughly a 3.65 yield,” McCoy said.
Rod Kantor, bond counsel, summarized the ordinance’s documents — authorizing the four warrant series, approving an escrow and refunding agreement, adopting a continuing disclosure agreement (to post financial information on EMMA) and approving the offering statement that informs investors. Kantor complimented city leadership and said the disclosure documents tell the city’s fiscal story to investors.
Council members agreed to consider the item under unanimous consent because staff said pricing obtained earlier that day would be lost if the sale was delayed. The motion to approve carried after a roll‑call assent that city staff recorded during the meeting.
What it means: City officials described the transaction as a refinancing and new‑money package that preserves a 20‑year debt‑service structure consistent with past practice. Staff said the market moved higher soon after the sale, which they said would have cost the city about $1.3 million more if delayed.
Next steps: The ordinance authorizes the issuance and the related disclosure and escrow steps necessary to close the financings; bond counsel and the city will complete closing mechanics and public disclosure consistent with the offering materials.
