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Bond advisor outlines plan to authorize $11.295M and explains premium-bond option to raise extra capital
Summary
Bond advisor Joe Kinder told the board $11,295,000 of authorized par remains to issue; he recommended returning in January with a parameters resolution and explained premium bonds could yield roughly $1M additional capital under current market assumptions, noting estimated true interest cost around 4.2%.
Joe Kinder briefed the board on the remaining bond authorization and the mechanics of a parameters resolution that would permit sale timing flexibility. Kinder said the district has $11,295,000 of par left to authorize and that the plan is to return with a resolution in January to authorize sale under parameters but not lock final rates until the pricing window in February so the district can close after March 1.
Kinder described premium bonds as a way to access additional capital now: he explained that selling bonds at a premium to investors — by structuring denomination and yield — can generate extra upfront dollars to increase project funds while increasing the stated-rate cost over the life of the bonds. Kinder estimated that, in current market conditions, premium structuring could produce approximately $1,000,000 of additional project funds on top of the $11.295M remaining, producing roughly $43.5M of total project funds before interest. He cited illustrative yields in the 3.7%–4.2% range for true interest cost vs bond yield.
Kinder recommended returning in January with a parameters resolution and then pricing in February, explaining market behavior and the prudence of the timeline given recent market volatility.
