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Bond sale reflects good credit, good timing
To fund the city’s 2014 street improvement project, the Maple Lake City Council adopted a resolution Tuesday, May 20, authorizing the issuance, sale and delivery of $1.44 million in general obligation improvement bonds, as well as the terms of a financial advisor agreement between the city and Northland Securities. The decision was reached by a 4-1 vote with Councilmember John Northenscold continuing his ongoing dissent for the project’s scope, cost and location.
George Eilertson of Northland Securities presented the timing and structure of a finance plan relating to the issuance of general obligation improvement bonds and reviewed the terms of the financial advisor agreement. He said the city’s bond rating assignment had been reaffirmed by Standard & Poor’s to be AA-, which he called “very strong credit,” benefitting the city as it enters the bond market. At the city’s former A- bond rating of a few years ago, he said, interest rates would have been about a quarter of a percent higher.
The bonds have been structured with a 15-year financing term, consistent with projects the city has financed in the past. Revenue sources the city will use to pay debt service include special assessments, a portion of water and sewer utility payments, and overall tax payments from the city’s entire population.
More information appears in this week's Messenger.
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