Title
Approval of the Refunding of Water Sewer Revenue Bonds and Revenue Bond Anticipation Notes
Action
Action:
A. Adopt a bond order and resolution that makes certain Statements of Fact concerning the refunding of Water Sewer Revenue Bonds and Revenue Bond Anticipation Notes (BAN),
B. Provide for the issuance of Water Sewer Revenue Bonds in an amount not to exceed $470 million to refund outstanding 2008 Revenue Bonds and 2015 BAN, and
C. Authorize City Officials to take necessary actions to complete the financing, including making the application to the Local Government Commission.
Body
Staff Resource(s):
Randy Harrington, Management and Financial Services
Angela Lee, Charlotte Water
Explanation
* This action provides for the refunding of both the 2008 revenue bonds and the 2015 BAN. The 2008 bonds are being refinanced at a lower rate to achieve savings. The 2015 BAN is replacing short-term debt with long-term permanent debt.
* In 2008 revenue bonds for water and sewer projects totaling $343 million were issued at a fixed rate. Approximately $288 million are outstanding and currently available for refunding. As of March 20, 2018 this refunding will save approximately $2.5 million annually, over 20 years ($50 million) in debt service expenses.
* In 2015 the City obtained a $180 million BAN to fund projects on an interim basis and planned to convert it to permanent debt at the end of the twenty-four to thirty-six month construction period.
* The projects being funded by this refunding are concentrated in four different areas:
* Capacity for growth
* Regulatory requirements
* Rehabilitation and replacement
* Commitment to public projects and utility operations
* This action does not require rate increases.
* In early fiscal year 2019 there will be a request for Council to authorize a new program to provide construction period funding for upcoming water and sewer capital improvements.
Fiscal Note
Funding: Water Sewer Debt Service Fund
Attachments
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