With a high number of public agencies expected to issue bonds the first week of December, the interest rates are expected to be higher than what the City wants to pay on the refinancing of roughly $17 million in City Lease Revenue Bonds. The sale of the bonds will therefore be delayed at least a week.
The bonds, which were authorized by the City Council on Nov. 16, are being issued to generate savings to the City over the next three fiscal years by refunding two prior bond issues, the 1996 Certificates of Participation and 2001 Lease Revenue Bonds. Those bonds were originally issued to finance the acquisition and construction of the public library and City Hall. The City will give residents first priority to purchase bonds.
“The delay intended to save the City money and achieve the interest savings we want to achieve by issuing these bonds,” said Assistant City Manager/Director of Administration Services, Irwin Bornstein. “We expect that if we tried to sell the bonds next week, the savings would be significantly less than $700,000 we are hoping for.”
The City will monitor the bond market on a day-by-day basis from now through the end of the year so it can be ready to sell the bonds as soon as the target savings level can be achieved. Residents who are interested in purchasing the bonds can obtain additional information from the bond underwriter, de la Rosa and Company, at 866-361-3300.
