Title
GO Bond Refunding Opportunities - Discussion Only
History
Recently, the Village’s financial advisor, Speer Financial, Inc., advised staff of potential refunding opportunities on the Village’s outstanding Series 2006 and 2004 General Obligation Bonds. The 2006 bonds were originally issued to partially fund construction of the new police facility. As per the attached Refunding Analysis, the estimated net present value savings to be realized by refunding the 2006 bonds is approximately $294,000, or 3.565% of refunded principal. This savings amount is net of all issuance costs and reflects the “Bank Qualified” status that would be given to the refunding bonds, as the total issuance is less than $10 million. As per the attached tentative Bond Sale Timetable, the bond sale is scheduled for Monday, July 2nd. All applicable Ordinances, as well as the results of the sale, will be brought before the Board for approval on this date. The overall sale process will begin with the circulation of the Official Statement to the financing team scheduled for June 6, 2012.
The 2004 bonds were originally issued to refund the 1998 bonds; the 1998 bonds were originally issued to fund expansion of the Centennial Pool, open lands purchases, Sportsplex architectural and engineering fees, and Orland Parkway construction. As per the attached Refunding Analysis, the estimated net present value savings to be realized by refunding the 2004 bonds is approximately $290,000 or 5.409% of refunded principal. This savings amount is net of all issuance costs and reflects the “Deemed Bank Qualified” status that would be given to these refunding bonds, as the issue that these bonds are refunding was bank qualified. The original series was an advanced refunding and we are not legally able to refund until within 90 prior to the call date, which is December 1, 2012. Therefore, we will begin the refunding process on these bonds later this year and if possible, refund at the same time we are issuing bonds for the Ninety 7 Fifty on the Park project.
On May 7, 2012, this item was discussed with the Finance Committee and is being presented to the Board for discussion.
...Recommended Action/Motion
For discussion only.