Fiscal Note
This resolution authorizes the issuance of general obligation promissory notes and bonds totaling $107,650,000 and levies an irrevocable property tax sufficient for the purpose of paying principal and interest on the debt. These notes and bonds are divided into five separate series:
Series A, with a par amount of $8,040,000, is classified as a "Recovery Zone Economic Development Bond-Direct Pay" issue, and is issued in conformance with authority made available under the federal stimulus program. The City will receive a direct federal interest rate subsidy equal to 45% of the interest rate stated on the notes. The proceeds will be used to finance a portion of the City Engineering Division's infrastructure improvement program. After applying the federal interest subsidy, the true interest cost of this series is 1.478%. Repayment is scheduled over the next 10 years.
Series B notes, with a par amount of $25,080,000, are classified as "Build America Bonds," also issued in conformance with authority made available under the federal stimulus program. The City will receive direct federal subsidies equal to 35% of the interest rate stated on the notes. The proceeds of this taxable series will be used to finance current year capital improvements authorized in the 2010 capital budget. A description of the specific expenditure purposes is contained in the resolution. After applying the federal interest subsidy, the true interest cost of this series is 1.892%. Repayment is scheduled over the six year period from 2015 through 2020.
Series C, with a par amount of $24,205,000, will be used to refinance the remaining maturities of the 2004 State Trust Fund Loan originally secured by the City to refinance City's prior service pension liability due to the Wisconsin Retirement Fund and take advantage of the extraordinarily low interest rates available in the market today. Sold at a true interest cost of 3.437%, these new tax exempt refunding notes replace al...
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