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Tea council approves conduit refunding bonds for University of Sioux Falls
Summary
The City of Tea approved a TEFRA public hearing and adopted a resolution authorizing conduit refunding revenue bonds for the University of Sioux Falls in an amount not to exceed $9.9 million; the council emphasized the bonds will not be obligations of the City.
The City of Tea held a public hearing and adopted RESOLUTION 26-02-03 authorizing the issuance of refunding revenue bonds to benefit the University of Sioux Falls. City Attorney Todd Meierhenry explained the City would serve only as a conduit issuer and would not provide funding or guarantee repayment.
Meierhenry told the council that “the bonds are not a debt of the City; [they] do not pledge taxes or City Revenues; and repayment comes solely from the University of Sioux Falls.” The resolution authorizes refunding bonds in a principal amount not to exceed $9,900,000 and approves related documents including a loan agreement, bond form and tax regulatory agreement.
Councilmember Lynn DeYoung moved to adopt the resolution and Councilmember Terry Woessner seconded; the motion passed with all members voting AYE. The minutes note the Series 2020 Bonds had been issued in the original aggregate principal amount of $18,000,000 and that the Series 2010 bonds had been originally issued in the amount of $11,157,000. Officials said the Refunding Bonds, if issued, are intended to be qualified 501(c)(3) bonds under Section 145 of the Internal Revenue Code and that the council’s public hearing satisfied the requirements of Section 147(f).
Next steps in the minutes direct city officials and bond counsel to execute documents required to effectuate the issuance, sale and delivery of the bonds if a financing is pursued.
