Oct. 19, 2010
Huntington Council Finance Committee Listens to Bond Re-Financing and Big Sandy Bond Issuance Proposals
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – Council’s finance committee listened to refinancing, consolidation and new bond issuance proposals at the Monday, Oct. 18 meeting.
First, the committee listened as Loretta Covington, Sanitary Board Executive Director, explained the bonds sold to complete council’s already approved gravity sewer rehabilitation (13th St. W and 19th St. E.) and replacing pumps at the Richmond Street, Oak Street, 22nd Street and Krauts Creek pump stations. These bonds total $2.6 million.
“The rates are in place for the issuance of these bonds,” Covington told finance chairman, Steve Williams.
In addition, the Sanitary Board “may” ask for the issuance of an additional $1.3 million in bonds, which are already in the package but not yet specified for specific use. Council will have to approve that use.
Second, the committee heard about the possible bond sale and refinancing package which would bring improvements to the Big Sandy Super Store Arena (all new seats, boiler, exterior concrete/plaza upgrade, ice hockey infrastructure) and refinance existing bond for the previous interior renovations of the Jean Dean Municipal Building.
The refinancing of the Dean Building bonds will likely save about $100,000 in interest due to the historic low rates, explained Brian Nurick of Director of Public Finance for Ross Sinclaire & Associates. The firm has been retained by the city to explore the possible bond sale and refinancing.
The City has about $3.9 million dollars outstanding on Jean Dean Building bonds and the BSSA bonds would be Recovery Zone Bonds with a total indebtedness of $9,120,000. According to bond counsel Anthony Caldwell the state Economic Development Board should this week approve the issuance of the Recovery bonds for which the federal government repays a portion of the interest (called a subsidy payment).
However, the bonds must be sold and finalized before Dec. 31, 2010.
The fixed interest would be about 4.05%. The city which now pays $670,000 for the Jean Dean Bonds would pay $690,000 a year for the 20 year AARA bonds.
Steve Williams asked if this would be a public or private offering to which Nurick responded “public.”
Delicately choosing words , Williams inquired if the city’s current financial status would hinder finding an investor for the bonds.
“We have seen a revival in the municipal sector as a whole,” Nurick explained , adding, “we’re less concerned than two years ago. People are looking for yields. I have no concern we could do a non-rated placement for the city.”
The Huntington Municipal Development authority would issue the bonds.
Huntington City Council must approve the ordinance and three readings are required.
In other business, the Finance Committee favorably recommended the purchase of two Chevy Tahoe’s for the Huntington Police Department from JAG grant funding and three grants for the Huntington Fire Department.
One of the grants for $20,000 would provide for a portable generator to be installed at Station One. The other grants allow for hazardous awareness and confined space training as well as a continuity of operations plan.
The latter assures that in the event of a catastrophe the succession of city officials and spending specifications are on paper. Williams pointed out that the charter calls for the Mayor to be succeeded by the Director of Finance and Administration.
The mayor can designate a succession order in writing and city council could assemble to elect a mayor. Williams stated that the succession plan could be an item placed on the 2012 ballot for charter revisions.
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Huntington Council Finance Committee Listens to Bond Re-Financing and Big Sandy Bond Issuance Proposals
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – Council’s finance committee listened to refinancing, consolidation and new bond issuance proposals at the Monday, Oct. 18 meeting.
First, the committee listened as Loretta Covington, Sanitary Board Executive Director, explained the bonds sold to complete council’s already approved gravity sewer rehabilitation (13th St. W and 19th St. E.) and replacing pumps at the Richmond Street, Oak Street, 22nd Street and Krauts Creek pump stations. These bonds total $2.6 million.
“The rates are in place for the issuance of these bonds,” Covington told finance chairman, Steve Williams.
In addition, the Sanitary Board “may” ask for the issuance of an additional $1.3 million in bonds, which are already in the package but not yet specified for specific use. Council will have to approve that use.
Second, the committee heard about the possible bond sale and refinancing package which would bring improvements to the Big Sandy Super Store Arena (all new seats, boiler, exterior concrete/plaza upgrade, ice hockey infrastructure) and refinance existing bond for the previous interior renovations of the Jean Dean Municipal Building.
The refinancing of the Dean Building bonds will likely save about $100,000 in interest due to the historic low rates, explained Brian Nurick of Director of Public Finance for Ross Sinclaire & Associates. The firm has been retained by the city to explore the possible bond sale and refinancing.
The City has about $3.9 million dollars outstanding on Jean Dean Building bonds and the BSSA bonds would be Recovery Zone Bonds with a total indebtedness of $9,120,000. According to bond counsel Anthony Caldwell the state Economic Development Board should this week approve the issuance of the Recovery bonds for which the federal government repays a portion of the interest (called a subsidy payment).
However, the bonds must be sold and finalized before Dec. 31, 2010.
The fixed interest would be about 4.05%. The city which now pays $670,000 for the Jean Dean Bonds would pay $690,000 a year for the 20 year AARA bonds.
Steve Williams asked if this would be a public or private offering to which Nurick responded “public.”
Delicately choosing words , Williams inquired if the city’s current financial status would hinder finding an investor for the bonds.
“We have seen a revival in the municipal sector as a whole,” Nurick explained , adding, “we’re less concerned than two years ago. People are looking for yields. I have no concern we could do a non-rated placement for the city.”
The Huntington Municipal Development authority would issue the bonds.
Huntington City Council must approve the ordinance and three readings are required.
In other business, the Finance Committee favorably recommended the purchase of two Chevy Tahoe’s for the Huntington Police Department from JAG grant funding and three grants for the Huntington Fire Department.
One of the grants for $20,000 would provide for a portable generator to be installed at Station One. The other grants allow for hazardous awareness and confined space training as well as a continuity of operations plan.
The latter assures that in the event of a catastrophe the succession of city officials and spending specifications are on paper. Williams pointed out that the charter calls for the Mayor to be succeeded by the Director of Finance and Administration.
The mayor can designate a succession order in writing and city council could assemble to elect a mayor. Williams stated that the succession plan could be an item placed on the 2012 ballot for charter revisions.
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