AGENDA ITEM REPORT
TITLE:
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AN ORDINANCE AUTHORIZING THE ISSUANCE OF A CAPITAL IMPROVEMENT REFUNDING REVENUE NOTE OF THE CITY AND THE EXECUTION AND DELIVERY OF A LOAN AGREEMENT IN AN AMOUNT NOT TO EXCEED $8,500,000 TO REFUND THE CITY'S OUTSTANDING CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2018; ACCEPTING THE PROPOSAL OF LENDER; APPROVING THE FORMS OF LOAN AGREEMENT AND NOTE; AND PROVIDING FOR THE PAYMENT OF SUCH NOTE FROM THE NON-AD VALOREM FUNDS OF THE CITY. (SECOND READING)(PUBLIC HEARING)
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BACKGROUND:
This item was approved on First Reading at the February 25, 2021, City Commission Meeting. However, the interest rate changed from 0.879% to 1.123% based on current market conditions, resulting in a revised total economic gain of approximately $392,400.
This ordinance provides for the issuance of Capital Improvement Revenue Note, Series 2021, to refinance the City's outstanding Capital Improvement Revenue Note, Series 2018.
DISCUSSION:
The City, in conjunction with its Financial Advisors, issued a Request for Proposals (RFP) for a Non-Ad Valorem Bank Note to refinance the City's outstanding Capital Improvement Revenue Note, Series 2018. This ordinance accepts the proposal from PNC Bank, National Association at an indicative fixed rate of 0.879% to refinance Capital Improvement Revenue Note, Series 2018, which has an interest rate of 2.74%. The interest rate of 0.879% is subject to change with market conditions through closing in March 2021, although the indication from financial markets is that interest rates are unlikely to move substantially in the short time until closing. The rate of 0.879% is 15 basis points below the next lowest proposal received. Staff will ensure the final rate is the most economical for the City. The maturity date of October 1, 2028, remains unchanged. The estimated total economic gain is $579,000 over the life of the note.
RECOMMENDATION:
Staff recommends approval of this ordinance.
FISCAL IMPACT:
REVENUES: $ 8...
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