Title
Consider/Discuss/Act on an Ordinance Authorizing the Issuance of “City of McKinney, Texas, General Obligation Refunding Bonds, Series 2017”, and Delegating Matters Relating to the Sale to an Authorized City Official(s)
Summary
COUNCIL GOAL: Financially Sound Government
MEETING DATE: July 18, 2017
DEPARTMENT: Financial Services
CONTACT: Mark Holloway, Chief Financial Officer
RECOMMENDED CITY COUNCIL ACTION:
• Approval of Ordinance
ITEM SUMMARY:
• The City has the option to refund in whole or in part the General Obligation Bonds, Series 2008, and aggregating in par amount of $14,525,000.
• The City also has the option to refund in whole or in part the Certificate of Obligation Bonds, Series 2008, and aggregating in par amount of $7,540,000.
• Refunding bonds is similar to refinancing debt obligations to take advantage of lower interest rates.
• Additionally, approval of this Ordinance will designate the City Manager, Chief Financial Officer, and Director of Finance as Pricing Officers to execute the transaction. This will enable pricing of the bonds at such time as the market conditions are most favorable.
BACKGROUND INFORMATION:
• Applications have been made to both Standard and Poor’s (S&P) and Moody’s Investors Services, Inc. (Moody’s) to review the bond rating.
• The 2008 General Obligation and the 2008 Tax and Limited Pledge Waterworks and Sewer System Revenue Certificates of Obligation Bonds were issued, sold, and delivered subject to the right and authority of the City to refund them prior to maturity.
FINANCIAL SUMMARY:
• Total debt savings of not less than $3,000,000.
• The current interest rate for the bonds ranges from 4.00% to 5.00% per annum.
BOARD OR COMMISSION RECOMMENDATION: None.