HomeMy WebLinkAboutIR 9236 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9236
000ATtNTo the Mayor and Members of the City Council April 27,UP, 2010
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• SUBEJCT: REFUNDING BONDS
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This Informal Report is to inform City Council about refunding bonds prior to the decision on
today's agenda regarding issuing approx. $98,855,000.00 in refunding bonds.
Generally, the bonds and Certificates of Obligation issued by the City of Fort Worth mature no
farther than 20 years out and have a call option at 10 years. This allows the City the option of
paying them off early (calling), anytime between the call date and the final maturity, with no
penalty.
A current refunding is simply refunding debt that is currently callable, which is technically defined
as being callable within 90 days of issuing the refunding bonds.
The M&C before you today is requesting authorization to issue refunding bonds on a current
refunding basis. All debt being refunded is currently callable or will be within the 90-day window.
Based on market estimates, the refunding presented to you today will generate approximately
$11,074,000.00 savings over the ten-year life of the bonds, or approximately $1.1 million of
savings per year. This amounts to a Net Present Value benefit of $9,488,640.45, or 8.7% of the
principal being refunded. No maturities are being extended in this refunding.
In addition, the bonds being sold today can be sold competitively due to the City's status of being
current on the annual issuance of the CAFR.
The Water Department issues debt under the authority of a Master Ordinance. However, each
issuance requires a supplemental ordinance that spells out the details specific to that issuance.
The ordinance under consideration today is the eighteenth supplemental ordinance.
If you have any questions, please contact James Mauldin, City Treasurer, at (817) 392-2438.
Dale A. Fiss ler; E.
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS