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Council authorizes up to $5M in bond anticipation notes to continue sewer capital program
Summary
Finance presented a plan to issue up to $5 million in bond anticipation notes (BANs) to fund sanitary and storm-sewer improvements as part of a 10-year capital plan; municipal advisor reported recent BAN pricing in the 2.65%–2.8% range and council approved the ordinance on first reading under suspension.
Director Potts and municipal financial advisor Matt Stusinski explained that the city will issue up to $5,000,000 in bond anticipation notes as a short-term financing step to fund sewer projects and to replace prior one-year BANs coming due. Director Potts said the 10-year sewer capital plan totals roughly $35 million and that the debt service will be funded by sewer fees.
Matt Stusinski told council other municipalities have issued BANs recently at yields between about 2.65% and 2.8%, and that city pricing is scheduled for April 21 "so we have a little bit of breathing room." Council asked about the multi-year structure; staff explained the practice of issuing one-year BANs and rolling them until a consolidated longer-term bond (expected next year) is executed. Council approved the ordinance on suspension with unanimous committee recommendation.
