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Council approves parameters resolution so Mountain Regional Water can refinance when market improves
Summary
Mountain Regional Water asked the council to approve a parameters resolution authorizing up to $18 million of refunding bonds; advisors said recent market volatility reduced immediate savings, so the district sought council authority to move when rates are favorable and the council approved the resolution unanimously.
The council, sitting as the Mountain Regional Water Service District governing board, approved a parameters resolution authorizing the issuance and sale of up to $18 million in water revenue refunding bonds so the district can refinance an earlier direct-placement bond if market conditions improve.
Steve Anderson, the district’s chief financial officer, and Brian Baker of Zions Public Finance explained that a 2023 direct-placement bond had a true interest cost (TIC) of roughly 5.17% and that a planned market refunding had looked attractive until recent rate volatility reduced projected savings. Baker advised the board to adopt the parameters resolution so staff and a pricing committee could act quickly when rates move back to a favorable window; he said the resolution can remain effective up to a year and that staff would only execute the refunding if it yields meaningful net savings.
Councilmembers asked about timing, the market drivers behind recent rate moves and the trade-offs of a public sale versus a bank placement. The finance advisors noted that issuance and call features affect the effective rate and that waiting for calmer market conditions could increase total expected savings. The council approved the parameters resolution by voice vote.
