Pella Chronicle

March 12, 2014

Proceeds from notes to be used for swimming pool upgrades

By Clint Brown The Chronicle
The Pella Chronicle

---- — The Pella City Council approved a Resolution Directing Sale of General Obligation Local Option Sales and Services Tax Bonds, Series 2014 during their meeting last week.

As reported, at the February 18, 2014 meeting, Council approved taking additional action for the authorization of a loan agreement and the issuance of not to exceed $4,000,000 General Obligation Local Option Sales and Services Tax Bonds and approval of the electronic bidding procedures and the official statement. The proceeds from the Notes will be used to provide funds to pay costs of renovating, equipping and furnishing the existing indoor swimming pool facility.

Moody’s Investor Services has assigned a credit rating of Aa3 to the City’s General Obligation Bond Issuance as noted in their report issued February 26, 2014, an upgrade from the A2 rating received for the City’s 2010 General Obligation Bond Refunding. Noted in the report is the City’s continued growth in tax base, healthy reserve levels, additional revenue raising flexibility and affordable debt and pension liabilities. Also noted in the report is the Council’s commitment to fiscal discipline achieved through long term financial planning, maintenance of healthy reserve levels and retained flexibility to raise operating revenues.

On March 4, 2014, received bids for the General Obligation Local Option Sales and Services Tax Bonds prior to the Council meeting with the results of the bids being disclosed to Council during the meeting. This resolution awards the Bonds to the bidder with the lowest true interest cost to the City of Pella. In addition, it authorizes the Mayor and City Clerk to sign the statement of contract for the Bonds on behalf of the City of Pella. The term of the Bonds is 9 years with a final maturity date of June 1, 2023.

It is important to note, our Financial Advisor, Public Financial Management and Bond Counsel, Ahlers & Cooney, have reviewed and approved the attached Resolution and sale notice.

While the bond issue limit is listed as not to exceed $4.0 million, the proposed General Obligation Local Option Sales and Services Tax Bonds will be for $3.2 million with a ten year term to assist in funding the following:

-Pool Construction Fund – $3,126,500

-Underwriter Discount – $ 32,000

-Cost of Issuance and Contingency – $41,500

-Total – $3,200,000

The annual debt service payments for the bond are proposed to be provided by local option sales and services taxes. As a result, staff does not believe there will be any impact to the City’s property tax rate as a result of this bond issue. However, because the proposed bond is a general obligation bond, the City Council could issue a debt service levy for the debt service payments if they desire to in the future.

In other business

-Council approved a resolution Ordering Specifications, Form of Contract, Notice to Bidders, Setting the Public Hearing, and Authorizing the Taking of Bids and Authorizing Bid Opening in Connection with Furnishing Steel Street Light Poles for the City of Pella.

This resolution sets the Public Hearing date as April 1, 2014, and authorizes the taking of bids for 47 direct embedded and 14 base mounted steel street light poles. These poles will be used in conjunction with the 2013 Southeast Distribution Conversion Project.

As background, Resolution No. 5431 was tabled at the Council meeting on February 4, 2014 so staff could research pricing on other designs of poles and fixtures. At the Policy and Planning meeting on February 18, 2014, staff presented various design options and pricing and was directed to proceed with the steel street light poles for the 2013 Southeast Distribution Conversion Project. Resolution No. 5431 has been amended to change the critical dates of the project.

-Council approved resolution accepting improvements, authorizing final payment, and closeout for the Cooling Tower Demolition Project.

This resolution accepts the improvements and authorizes final payment to Tomorrow’s Resources for the Cooling Tower Demolition Project. This project consisted of demolition of all four cells of the cooling tower along with the removal of concrete and associated piping/utilities from the site.

The project engineer, PRVN Consultants, has found that the work performed was completed in accordance with the plans and specification. The Engineer also reviewed the request for final payment documents and recommended the release of retainage of $6,700 to Tomorrow’s Resources:

-Original Contract – $134,000.00

-Payment to date – 127,300.00

Final Payment – $6,700.00

The final project costs (including final payment) are as follows:

Engineering: $43,381.89

Demolition: $134,000.00

Testing: $10,058.75

Disposal: $15,954.89

Total: $ 203,395.53