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City of Missoula, Montana Item to be Referred to City Council Committee Committee: Administration & Finance Item: Recommended Approval of Parameters Resolution to authorize the negotiated sale of up to $1,075,000 of General Fund Bonds to finance energy improvements Date: October 14, 2010 Prepared by: Brentt Ramharter Initiated by: City Administration based on recommendation from City's Financial Advisor Action Required: Pass the resolution: " A RESOLUTION OF THE MISSOULA CITY COUNCIL RELATING TO LIMITED TAX GENERAL OBLIGATION BONDS, SERIES 2010C; DELEGATING THE NEGOTIATION OF THE PRICING OF THE SERIES 2010C BONDS TO A PRICING COMMITTEE; AND AUTHORIZING THE ISSUANCE OF AND PROVIDING FOR THE NEGOTIATED SALE THEREOF.” Recommended Motion: I move the City Council pass the RESOLUTION OF THE CITY OF MISSOULA, MISSOULA COUNTY, MONTANA, RELATING TO LIMITED TAX GENERAL OBLIGATION BONDS, SERIES 2010C; DELEGATING THE NEGOTIATION OF THE PRICING OF THE SERIES 2010C BONDS TO A PRICING COMMITTEE; AND AUTHORIZING THE ISSUANCE OF AND PROVIDING FOR THE NEGOTIATED SALE THEREOF. Timeline: Referral to committee: October 14, 2010 Committee discussion: October 20, 2010 Council acts to set hearing: Not needed. Public Hearing: Not needed. Deadline: Need to have Council approve resolution on October 25th in order to have adequate time to complete the negotiated sale within 2 weeks, possibly on November 1, 2010. Background and Alternatives Explored: Due to the small size of the financing, the City's Financial Advisor recommended a negotiated sale be undertaken with D.A. Davidson & Co. as the selected underwriter. We are targeting a pricing date for the Bonds as early as November 1, 2010. We recommend that the City Council adopt a “parameters” resolution at its October 25th meeting at which time it will set the maximum par amount of the bonds of $1,075,000 (with the anticipated par amount being $1,030,000), a maximum true interest cost, and a final maturity date. This approach allows for maximum flexibility in the pricing of the bonds and allows the underwriter to enter the market at the optimum time, which does not always coincide with the Council’s meeting date. Subsequent to the pricing, the Council will be presented with a confirming and ratifying resolution memorializing the final terms of the issue. Financial Implications: See discussion above: Attachments: Resolution