Title
AN ORDINANCE PROVIDING FOR THE ISSUANCE AND SALE OF $3,850,000 OF NOTES, IN ANTICIPATION OF THE ISSUANCE OF BONDS, FOR THE PURPOSE OF PAYING COSTS OF ACQUIRING AND INSTALLING EQUIPMENT AS PART OF THE CITY’S MUNICIPAL BROADBAND SERVICES SYSTEM PROJECT.
Brief Description: This Ordinance authorizes internal borrowing for the installation of the broadband services system (Velocity Broadband). These roll forward the notes issued in 2019 of $3,850,000 for five months so they mature at the same time as other currently outstanding notes. For cost savings purposes, we plan to roll these notes into one large bond issue in December 2020.
Body
Legislative History
Ordinance No. 15-81 authorized the issuance of $800,000 of notes for the pilot phase of the broadband services project.
Ordinance 16-123 authorized $2,100,000 of notes for the continuation of the broadband services project.
Ordinance 17-113 authorized $3,400,000 of notes for the continuation of the broadband services project.
Ordinance 18-95 authorized $3,400,000 of notes for the continuation of the broadband services project.
Ordinance 19-81 authorized $3,850,000 of notes for the continuation of the broadband services project.
Purpose & Explanation
In 2015, we issued an $800,000 note for the pilot phase of Velocity Broadband. In 2016, we added $1.3 million to fund the continuation of the installation. In 2017, we added an additional $1.3 million and in 2019, we added $450,000 for the continuation of the project bringing the total borrowed to $3,850,000.
This legislation authorizes us to roll the notes forward for five months so that we can combine them other notes currently outstanding into a larger bond issue. By combining the notes, we will save on bond issuance costs and a larger issue generally attracts more bids. We expect the municipal debt market conditions to be more stable by December and rates to remain low.
The other currently outstanding notes are City Hall improvements ($950,000), Brine Well ($1,900,000) and Hudson Drive water line ($650,000). We also have $7,725,000 in outstanding notes for the salt dome and bus garage that we will not permanently finance until the downtown project is complete.
Timing Considerations
Staff is requesting passage of the legislation to allow the Velocity notes to be rolled forward for five months.
Fiscal Impact
Currently Budgeted
Supplemental Appropriation Required
X Appropriation Not Required.
Recommendation
Suggested Action
Staff recommends passage of the Ordinance to allow the project to continue as approved.
Submitted by,
Jane Howington, City Manager
Jeff Knoblauch, Asst City Manager/Finance Director
Will Ersing, Network Systems Administrator