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Fraser says bonds priced; June 4 closing expected to repay interim loans for wastewater project
Summary
Town staff reported the wastewater bonds priced at a 6.17% interest rate and that the June 4 closing should reimburse interim loans, including a second interim loan of about $5.3 million; Prop 123 and a Fraser River Valley Housing Partnership award are expected to close the same day.
Fraser — Town staff told the Fraser Board of Trustees May 20 that municipal bonds for the wastewater project priced and the town expects a June 4 closing that should reimburse interim loans and improve the town’s cash position.
"We actually priced our bonds today," a town staff member reported at the meeting, adding that the deal was oversubscribed and priced at about a 6.17% interest rate. Staff said investors were interested at roughly four times the amount the town sought, and that the closing will allow the town to repay a previously issued second interim loan (about $5.3 million) and reimburse other bridge financing.
Staff also said the closing will coincide with receipt of Prop 123 funds and roughly $1 million from the Fraser River Valley Housing Partnership that had been awarded the previous year, all of which will help restore the general fund once the bonds and reimbursements are in hand. A DOLA (Division of Local Affairs) grant was described as a grant, not a loan, and staff praised the finance team and outside counsel for their efforts on the deal.
The board heard the finance update in response to a public question about the status of the St. Louis financing; staff said they believe they are in a strong position and will not need additional board funding at this time. Specific bond documents and final numbers will be confirmed at closing.
