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Mankato sells roughly $14.5M in general obligation bonds at competitive rate; S&P assigns AA
Summary
The city sold general obligation improvement and utility bonds originally sized at $14.62M; strong bids and a premium allowed the issue to be reduced to $14,455,000, with a true interest cost of about 3.159 and an S&P AA rating (stable outlook). Proceeds will fund street and utility projects over a 10‑year term.
The Mankato City Council on May 11 received results from a competitive sale of general obligation improvement and utility bonds and approved awarding the issue to the low bidder.
Sale results: Chris Hogan, director at Baker Tilly and the city's municipal advisor, told the council the city sought about $14,620,000 in bonds (series 2026A). Piper Sandler submitted the winning bid with a true interest cost of about 3.159. Because the winning bid produced a premium, the city reduced the bond issue size to $14,455,000. The bonds carry a 10‑year amortization and an optional redemption date after Feb. 1, 2034.
Credit and repayment: Hogan said Standard & Poor's assigned the city a AA rating with a stable outlook, citing disciplined budget practices, strong management scores and improving debt metrics. Repayment sources include combinations of general tax levies, special assessments and net revenues from water, wastewater and stormwater enterprise funds.
Council action: After questions about bidder participation and competitiveness, Council Member Lavin moved and Council Member Mettler seconded approval of the resolution to award the bonds to Piper Sandler; roll call votes were unanimous.
Next steps: The city will proceed with issuance as approved; council authorized execution of related documents and staff will monitor debt levels and reserve performance per standard financial practice.
