News

Archives

March 13, 2015

Council approves placement agent for bond refunding, could save city over $150000

GAYLORD — City Council members voted to approve Robert W. Baird & Co. Inc. as a placement agent for the city in regard to the refunding of wastewater treatment bonds, a move expected to save the city more than $150,000.

The vote was unanimous to name Baird as the placement agent, allowing the financial services firm, which has a Traverse City office, to begin coordinating the placement and issuance of Unlimited Tax General Obligation Refunding Bonds.

These refunding bonds would refinance wastewater treatment bonds from 1999 and 2005, originally created to allow expansion of the city wastewater treatment plant.

Currently, the 1999 bond has an interest rate of 4.2 percent and a rate of 4 percent on the 2005 bond. According to Joe Duff, city manager, through the refunding bonds, the current bonds would be refinanced with lower interest rates.

“We feel we could do better,” Duff said. “It makes sense to do this.”

Duff said the municipal finance adviser indicated to the city that this could save approximately $154,680 total on bonds, a savings estimate he said could rise. The bonds themselves would not increase as far as percentage and bond retirement would stay the same.

“All this would do is save the ability for savings to be passed along to our residents and the community,” Duff said. “The bonds would not increase and retirement would stay at 2020.”

The placement agent fee for Baird comes at a cost of $13,500 to the city, with an additional $400 for the Municipal Advisory Council Fee.

Councilman Bill Wishart motioned to approve the placement and engagement letter, and council members voted unanimously in approval.

By approving Baird as the placement agent, this allows Baird to more forward and begin coordinating the bond issue, which includes making contact with financial institutions and holders of existing bond notes, and begin looking at the sale of refunding bonds.

The bond issue would next be advertised for bids, which would lead to a call to the city with the rate and what the bonds would go for, followed by an acceptance resolution presented to the council.

Electronics recycling service canceled

• Council members voted to cancel electronics recycling services from Vintage Tech Recyclers after finding the organization planned to charge the city for what was once a free service.

According to Duff, Vintage Tech planned to charge $7,000 for electronics recycling during an event that previously came at no cost to the city or participants.

Though the service was canceled, Ed Tholl, Department of Public Works superintendent, said he has been looking at other options to replace Vintage Tech while continuing to provide the electronics recycling service event.

One option being considered is Bay Area Recycling for Charities, based in Traverse City. Tholl said for an estimated cost of approximately $1,000 to $2,000, they would send trucks and four people to pick up all of the electronics to be recycled.

Duff said such a service is unnecessary.

“Right now, the way we have our spring cleanup set, we are collecting any of the products our citizens and residents wish to put out,” Duff said. “I just don’t think we necessarily need to do this program.

“City residents would not be affected one bit.”

Duff also cited the current recycling program in Otsego County as another reason why such a service would be unnecessary. He added if the county wished to add electronics recycling to their services, the city could consider passing a bond to help.

In other news:

• Mayor John Jenkins proclaimed April 2015 as Sexual Assault Awareness Month in Gaylord.

• Council members approved a request for the St. Patrick’s Day Parade, this Saturday. The 15th annual parade will run from Main Street to the Community Center on Center Avenue.

Mark Johnson (989) 732-1111 mjohnson@gaylordheraldtimes.com

Gaylord Harold Times