HomeMy WebLinkAboutItem 05 - Bonds ITEM ,ayp .._......
MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: BRUNO RUMBELOW, CITY MANAGER (2
MEETING DATE: APRIL 7, 2009
SUBJECT: COMBINATION TAX AND TAX INCREMENT REINVESTMENT
ZONE REVENUE REFUNDING BONDS, SERIES 2009
RECOMMENDATION:
City Council to consider approval of an ordinance for the purpose of issuing City of
Grapevine, Texas Combination Tax and Tax Increment Reinvestment Zone Revenue
Refunding Bonds, Series 2009, in the aggregate principal amount not to exceed
$16,000,000.
BACKGROUND:
This bond ordinance is known as a parameters ordinance. It allows for the refunding of
bonds to take place within a period of time if certain parameters are met. The process is
new to the City of Grapevine but does allow greater flexibility in the sale of the refunding
bonds. Because of unstable market conditions the ordinance gives the authority to staff to
choose when to sell the bonds as long as it is within the parameters of the ordinance.
Staff has been presented with a proposal for the refunding of outstanding bonds. The total
for the two issues is $48,000,000. This amount is the maximum allowed that would stay
within the parameter of the ordinance. The estimated savings in interest payments is
$3,000,000 with a present value savings of 7.71%. The parameters of the ordinance would
not allow a refunding if the savings dropped below 5%. The need for the parameters
ordinance is to allow staff the opportunity to pick when the sale takes place and not be
locked in to a set date as was done in the past.
Staff recommends approval of the ordinance.