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HomeMy WebLinkAboutMinutes-06/03/2008• • June 3, 2008 The City Clerk of the City of Waterloo, Iowa, met in the City Clerk's Office, City Hall, 715 Mulberry Street, Waterloo, Iowa, at 11:00 a.m. on Tuesday, June 3, 2008, to open bids received and refer the sale of $10,000,000.00 General Obligation Bonds, Series 2008A, to the best and most favorable bidder for cash, subject to approval of the City Council at 4:30 p.m. on the above date. The following persons were present at said meeting: Michelle Weidner, Chief Financial Officer; Nancy Eckert, City Clerk; and Larry Burger, Vice President of Speer, Financial, Inc. This being the time and place for the opening of bids for the sale of $10,000,000.00 General Obligation Bonds, Series 2008A, the meeting was opened for receipt of electronic bids for the bonds. The following electronic bids were received, placed on file, and electronic bidding closed: Name of Bidder 1. Morgan Keegan & Company, Memphis, Tennessee 2. Griffin, Kubik, Stephens & Thompson, Inc., Chicago, Illinois 3. RBC Capital Markets, St. Petersburg, Florida 4. National City, Investments, Cleveland, Ohio 5. Stifel, Nicolaus & Company, Minneapolis, Minnesota 6. Ruan Securities, Inc., Des Moines, Iowa Whereupon the City Clerk declared the time for filing of electronic bids for the sale of $10,000,000.00 General Obligation Bonds, Series 2008A, to be closed, and whereupon the City Clerk declared the electronic bids be read, which were as follows: Name of Bidder True Interest Rate 1. Morgan Keegan & Company, Memphis, Tennessee 3.5792941 2. Griffin, Kubik, Stephens & Thompson, Inc., Chicago, Illinois 3.6455761 3. RBC Capital Markets, St. Petersburg, Florida 3.6641561 4. National City, Investments, Cleveland, Ohio 3.6694231 5. Stifel, Nicolaus & Company, Minneapolis, Minnesota 3.7137921 6. Ruan Securities, Inc., Des Moines, Iowa 3.8039411 The best bid was determined to be as follows: Morgan Keegan & Company of Memphis, Tennessee with True Interest Rate of 3.5792941 Whereupon all bids were referred to Speer Financial, Inc. and the meeting adjourned to 4:30 p.m. in the City Hall Council Chambers on June 3, 2007. The City Clerk of the City of Waterloo, Iowa, met in the City Clerk's Office, City Hall, 715 Mulberry Street, Waterloo, Iowa, at 11:30 a.m. on Tuesday, June 3, 2008, to open bids received and refer the sale of $2,975,000.00 General Obligation Bonds, Taxable Series 2008B, to the best and most favorable bidder for cash, subject to approval of the City Council at 4:30 p.m. on the above date. The following persons were present at said meeting: Michelle Weidner, Chief Financial Officer; Nancy Eckert, City Clerk; and Larry Burger, Vice President of Speer, Financial, Inc. This being the time and place for the opening of bids for the sale of $2,975,000.00 General Obligation Bonds, Taxable Series 2008B, the meeting was opened for receipt of electronic bids for the bonds. The following electronic bids were received, placed on file, and electronic bidding closed: Name of Bidder 1. Griffin, Kubik, Stephens & Thompson, Inc., Chicago, Illinois 2. Morgan Keegan & Company, Memphis, Tennessee 3. BB&T Capital Markets, Richmond, Virginia 4. Cronin & Co., Minneapolis, Minnesota June 3, 2008 Page 2 5. Northland Securities, Inc., Minneapolis, Minnesota 6. First Bankers' Banc Securities, St. Louis, Missouri whereupon the City Clerk declared the time for filing of electronic bids for the sale of $2,975,000.00 General Obligation Bonds, Taxable Series 2008B, to be closed, and whereupon the City Clerk declared the electronic bids be read, which were as follows: Name of Bidder True Interest Rate 1. Griffin, Kubik, Stephens & Thompson, Inc., Chicago, Illinois 4.868862% 2. Morgan Keegan & Company, Memphis, Tennessee 5.062099% 3. BB&T Capital Markets, Richmond, Virginia 5.086199% 4. Cronin & Co., Minneapolis, Minnesota 5.093762% 5. Northland Securities, Inc., Minneapolis, Minnesota 5.120718% 6. First Bankers' Banc Securities, St. Louis, Missouri 5.146632% The best bid was determined to be as follows: Griffin, Kubik, Stephens & Thompson, Inc. of Chicago, Illinois with a True Interest Rate of 4.868862% Whereupon all bids were referred to Speer Financial, Inc. and the meeting adjourned to 4:30 p.m. in the City Hall Council Chambers on June 3, 2008. June 3, 2008 The Council of the City of Waterloo, Iowa, met in Special Session at City Hall Council Chambers, Waterloo, Iowa, at 4:30 p.m. on Tuesday, June 3, 2008. Mayor Timothy J. Hurley in the Chair. Roll Call: Cole, Getty, Hart, Steve Schmitt, Welper, Reggie Schmitt. Absent: Greenwood. 127224 - Reggie Schmitt/Steve Schmitt that the Agenda, as proposed, for the Special Session on Tuesday, June 3, 2008, at 4:30 p.m., be accepted and approved. Ayes: Six. Absent: Greenwood. Motion carried. 127225 - Reggie Schmitt/Welper that copies of the Call for the Special Session on Tuesday, June 3, 2008, be received and placed on file. Ayes: Six. Absent: Greenwood. Motion carried. BOND SALE 127226 - Getty/Reggie Schmitt that proof of publication of notice of public hearing on Notice of Sale on consideration of the proposition of issuance of not to exceed $10,000,000.00 General Obligation Bonds, Series 2008A, as published in the Waterloo Courier on May 23, 2008, be received and placed on file. Prior to a vote on the above motion, the following comments were heard. Michelle Weidner, Chief Financial Officer, distributed copies of the Office Statement which is sent to all potential bidders and also a letter from her regarding Moody's Bond rating. Mayor Hurley reported that the city received notification from Moody's that the city has maintained its Al rating for this bond issue. Mayor Hurley commented that he feels positive if the city keeps up with what we are doing he expects we will jump up to an Aa rating. Following comments a vote was taken on the above motion with the following result. Ayes: Six. Absent: Greenwood. Motion carried. 127227 - Larry Burger, Vice President of Speer Financial, Inc., complimented Mayor Hurley, Michelle Weidner and Noel Anderson on the excellent job they did at the Moody's presentation. Mr. Burger noted that he feels confident that within the next couple of years the city will make the jump to Aa bond rating. • • • • June 3, 2008 Bond Sale continued Page 3 Mr. Burger reported that in the past the city purchased insurance and paid a premium up front for an Aaa rating. This year we did not purchase the insurance, but made sure the issue qualified for insurance and allowed underwriters to put that right into the bid. In the past the city would have paid about $30,000.00 for the insurance. Mr. Burger reviewed the report from Moody's who reaffirmed the city's Al general obligation rating. Moody's noted the city's tax base, currently valued at $3.1 billion, continues to experience steady growth, averaging 7.9 percent annually over the past five years. Moody's believes the city's improved financial operations will remain sound due to prudent fiscal management and healthy reserves. The city continues to increase the cash balance and currently 18 percent of the General Fund revenues remains undesignated. Mayor Hurley noted that his personal target is 25 percent and that council continues to help with the cash reserve. Mr. Burger noted that Moody's reported that the city's principal amortization is rapid, with 88.8 percent repaid in ten years. Moody's expects the city's debt burden to remain manageable based on expected tax base growth, rapid repayment and prudent management. Mr. Burger reported that the city received six bids today. Moody's Investors Service had an investment rating of Aaa with an underlying rating of Al. Mr. Burger reviewed the six bids. Morgan Keegan & Company of Memphis, Tennessee was the low bidder with 3.579294 percent true interest rate. Morgan Keegan & Company bid at premium, which the city would have had to pay $80,000.00 and also gave $17,000.00 discount so the city actually will have $97,000.00 more. The total cost for the bonds was $2,100,505.00, which was about $130,000 difference between the high and low bidders. Mr. Burger noted that part of the $10 million issuance was for current refunding bonds, with $6 million in new bonds. The old interest rate was 4.2 percent and the new interest rate if 3.5 percent, which is a net saving of $82,886.71. Mr. Burger reviewed the debt service schedule for these bonds. Mr. Burger recommended that the bonds be awarded to Morgan Keegan & Company of Memphis, Tennessee at a price of $10,017,747.35, with a true interest rate of 3.5792 percent. Councilperson Steve Schmitt commented that building reserves is one of the city's goals and asked what else would affect the city's bond rating. Mr. Burger responded that the city is doing everything right, and while talking with the representative from Moody's there was a lot of discussion about increasing the rating this year. Mr. Burger noted that steady or increasing reserve funds and continued growth will help the city move up to an Aa rating. Getty/Cole that "Resolution directing sale of $10,000,000.00 General Obligation Bonds, Series 2008A, to Morgan Keegan & Company of Memphis, Tennessee for a true interest rate of 3.5792 percent", be adopted. Ayes: Six. Absent: Greenwood. Resolution adopted and upon approval by Mayor assigned No. 2007-467. 127228 - Getty/Reggie Schmitt that proof of publication of notice of public hearing on Notice of Sale on consideration of the proposition of issuance of not to exceed $2,975,000.00 General Obligation Bonds, Taxable Series 2008B, as published in the Waterloo Courier on May 23, 2008, be received and placed on file. Ayes: Six. Absent: Greenwood. Motion carried. 127229 - Larry Burger, Vice President of Speer Financial, Inc. noted that the $10,000,000.00 bond issuance was for a public good, but this issuance will be taxable because the city has a contract with a private individual. Mr. Burger noted that Ahlers Law Firm, the city's bonding attorney, tells us what is tax exempt and what is taxable. Mr. Burger reported the city received six bids for this issuance, and he reviewed the bids with council. Mr. Burger noted that Griffin, Kubik, Stephens & Thompson, Inc. of Chicago, Illinois was the low bidder with a true interest rate of 4.8688 percent with a total cost of $852,154.00. Mr. Burger reviewed the debt service schedule. Mr. Burger noted that last year the city's interest rate was 4.2 percent for non-taxable and 5.6 percent for taxable. June 3, 2008 Page 4 Bond Sale continued Mr. Burger recommended the taxable bonds be awarded to Griffin, Kubik, Stephens & Thompson, Inc. of Chicago, Illinois at a price of $2,994,094.55, and a true interest rate of 4.8688 percent. Getty/Cole that "Resolution directing sale of $2,975,000.00 General Obligation Bonds, Taxable Series 2008B, to Griffin, Kubik, Stephens & Thompson, Inc. of Chicago, Illinois for a true interest rate of 4.8688 percent", be adopted. Ayes: Six. Absent: Greenwood. Resolution adopted and upon approval by Mayor assigned No. 2007-468. ADJOURNMENT 127230 - Cole/Reggie Schmitt that the Council adjourn at 5:05 p.m. Ayes: Six. Absent: Greenwood. Motion carried. Nancy Eckert, CMC City Clerk • •