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Calhoun County commissioners approve notice to issue 2021 pension obligation bonds, citing up to $11 million in estimated savings
Summary
The Calhoun County Board of Commissioners on Feb. 4 approved a Notice of Intent to issue 2021 pension obligation bonds to pay unfunded liabilities for two closed defined-benefit plans. County officials said the financing could save up to about $11 million over the life of the bonds and the bond sale is expected by June 30, 2021.
Calhoun County Administrator/Controller Kelli Scott told the Board of Commissioners on Feb. 4 that the county will publish a Notice of Intent to issue 2021 pension obligation bonds to pay unfunded liabilities for two of the county’s defined-benefit pension plans.
Scott said those two plans have been closed to new hires since February 2020 with agreement from the relevant employee unions, and that the financing is projected to create an estimated savings of up to 40%, roughly $11 million over the life of the bonds. Municipal advisor Bobby Bendzinski told the board current interest-rate conditions make the timing reasonable and said the county is aiming to complete a bond sale by June 30, 2021. Bill Danhof, principal attorney at Miller Canfield serving as the county’s bond counsel, told commissioners his firm prepared the resolution and supports the financing mechanism.
The board voted 7-0 to approve Res.021-2021, the Notice of Intent and the county’s comprehensive financial plan for the bonds. The motion was moved by Commissioner Gary Tompkins and seconded by Commissioner Kathy-Sue Vette. Chair Steve Frisbie later described the action as protecting employees and the county’s fiscal position.
Why it matters: The county seeks to convert unfunded pension liabilities into a financed obligation that officials say will reduce long-term costs. The resolution and financial plan authorize public notice and the steps necessary to proceed toward a bond sale; they do not, by themselves, finalize debt issuance or set the sale terms.
What was said and next steps: Administrator Scott described the plan and the anticipated savings; the municipal advisor outlined timing and market rationale; bond counsel confirmed the legal documents were prepared. The board approved the Notice of Intent, which triggers publication requirements and further procedural steps toward issuance. No public hearing on the bond sale was recorded in the minutes of this meeting; commissioners did not record any roll call dissent.
The board is expected to proceed with the public-notice and sale process consistent with Res.021-2021 and applicable legal requirements. No final bond sale terms were recorded in these minutes.
