Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
New Prague EDA approves $10.04 million lease revenue bonds to finance police facility
Summary
The City of New Prague Economic Development Authority approved Resolution 25-10-8-1 to award lease revenue bonds (Series 2025C) to fund the police facility; Ehlers reported an S&P AA- rating and a true interest cost of 4.485%, allowing the award to Baird at a reduced principal of $10,040,000.
The City of New Prague Economic Development Authority voted to approve Resolution 25-10-8-1 awarding the sale of lease revenue bonds (series 2025C) to finance the city’s new police facility.
Rebecca Kurtz, a representative from municipal-finance firm Ehlers, told the board that Standard & Poor’s assigned an AA-minus rating with a stable outlook to the EDA bonds and that the sale drew a single bid from Baird with a true interest cost of 4.485%. "The bid that Baird provided had a true interest cost of 4.485%," Kurtz said, and she reported that the underwriter’s premium allowed the city to reduce the funded principal from the originally anticipated $10,130,000 to $10,040,000.
The rating and the bid results, Kurtz said, reflect the city’s healthy finances and growth. She explained the difference between the EDA lease structure and a city general-obligation bond, noting that EDA lease debt typically carries a slightly lower credit backing than the city’s GO debt because it lacks the broad levy pledge.
Board members asked for context and comparisons to past sales; Kurtz said recent market moves helped produce a more favorable sale than the presale estimate, and she walked through payment timing and estimates. She reported an estimated first interest payment in August 2026 of about $341,000 and a combined principal-and-interest payment on Feb. 1, 2027 of roughly $287,000. Kurtz also noted the estimated annual levy—accounting for a Minnesota statutory 5% requirement—at about $660,000.
Chair moved to approve the resolution, the ground lease between the city and the EDA, and the lease-purchase agreement; the motion was seconded and approved by voice vote. No opposing votes were recorded on the audio transcript.
The bond proceeds are expected to be available to the city on Oct. 30, according to Ehlers. The board packet and the S&P report were referenced during the discussion; the board did not request additional action beyond the approval vote at this meeting.
