City of Alexandria, Virginia
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MEMORANDUM
DATE: FEBRUARY 5, 2014
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
FROM: RASHAD M. YOUNG, CITY MANAGER /s/
DOCKET TITLE:
TITLE
Consideration of a Resolution Authorizing the Issuance and Sale of General Obligation Refunding Bonds. [ROLL-CALL VOTE]
BODY
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ISSUE: Consideration of a resolution authorizing the issuance and sale of General Obligation Refunding Bonds.
RECOMMENDATION: That City Council adopt the attached resolution, which:
1) Authorizes the issuance and sale of the General Obligation Refunding Bonds;
2) Approves the form and other details of such bonds;
3) Authorizes the City Manager and the Director of Finance to take all actions as shall be required in connection with the issuance, sale and delivery of such bonds; and
4) Provides details with respect to the issuance of such bonds.
DISCUSSION: Interest rates on long-term municipal bonds continue to hold at historically very low levels and are not forecasted to move dramatically in the coming months. This means the City may be able to refund some portion of existing outstanding City general obligation bonds and have some savings debt service costs. Staff will continue to monitor the bond and treasury markets to determine what City bond issues, if refunded, would result in an overall savings of at least 3 percent on a present value basis. The 3 percent threshold is the commonly followed industry standard for refunding of municipal bonds. At this time, it appears that about $19.0 million in existing City bonds may be able to be refinanced.
The proposed resolution gives the City Manager and Director of Finance the authority to issue new bonds to refund the callable portion of the bonds that have at least 3 percent savings on a present value basis. To refund existing outstanding bonds, the City would issue new refunding bond...
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