Bond Refinancing and $40 Million in General Obligation Warrants Approved

Birmingham City Hall, Photo By Cody Owens

The Birmingham City Council unanimously approved $40 million in General Obligation Warrants and bond refinancing, which will allow for capital funding for a several projects throughout the city.

The financing consists of two parts as follows:

Approximately $40 million General Obligation Refunding Bonds

· Refinances Series 2007A Bonds

· Projected savings from lower interest rate is $7 million, with a net present value of $5.5 million

· The net present value savings as a percentage of the principal amount of bonds being refunded is approximately 11.8 percent, indicated a very efficient refinancing transaction

· True Interest Cost is approximately 3.18 percent

· Savings will remain in the Bond Reserve Fund to be used for any future voted bond issue

· Principal and interest payments will be over the same period as the outstanding bonds, through 2033

Approximately $40 million General Obligation Warrants

Warrant issue will provide capital funds for the following projects:

· Bus Rapid Transit Grant Match $20,000,000

· BRT Additional $1,750,000

· Landfill Cell $7,500,000

· Industrial/Tech Park $4,600,000

· Legion Field Improvements $2,250,000

· Boutwell Improvements $750,000

· Central Library Stairs $1,500,000

· Wylam Library Additional Funds $800,000

· Crossplex Basketball Courts $600,000

The Warrants will be repaid over 25 years. Principal and interest payments will be approximately $1.4 million in 2019 and $2.4 million through 2043 and will be paid from the General Fund. $2 million was budgeted for 2019 for this anticipated issue.

The anticipated interest rate is approximately 3.68 percent and this borrowing should have no effect on the City’s credit rating as the agencies are expecting it, according to the Finance Department.

The financing team consists of:

Underwriters: Loop Capital Markets, Blaylock Van, Wells Fargo Securities and Securities Capital Corporation

Bond Counsel: Maynard, Cooper & Gale Issuer’s

Counsel: Yvonne Green Davis

Minority participation is approximately 75 percent

Description of projects to be financed:

BRT Grant match — $20 million

The City Council last year approved the grant agreement with Federal Transit Administration for the $40 million Bus Rapid Transit project. The grant requires $20 million local match (50/50 match).

BRT additional cost — $1.75 million

· Downtown Center Median guideway

· CrossPlex guideway realignment

· Woodlawn property acquisition

· Traffic Signal Priority and Preemption System

· Street widening and sidewalk improvements

· Industrial Park — $4.6 million. The City council approved the agreement with US Steel to develop the Business/Tech Park next to Barber Motor Sports and received property for the Southern Museum of Flight (Economic Development)

Legion Field — $2.25 million

· Replace the field turf

· Repairs to the Light Towers

· Install a new Scoreboard at North end zone

· Seating repairs and replacement

· Security upgrades and barriers at entry points

Boutwell Auditorium — $1 million

· Americans with Disability upgrades

· Flooring replacement

· Painting

· Seating repairs and replacement

Central Library Stairs — $1.5M to replace in inoperable escalators

Wylam Library — $800K in additional funding for the Construction of a new Library to replace the existing Library. Total cost of project $1.5M

2018 Summer Interns

During Tuesday’s meeting, the Council also approved an ordinance that was presented by the outstanding group of 2018 City Council summer interns who have spent the last six weeks at city hall, attending meetings and learning all about municipal government.

The ordinance amends Title 2, Chapter 5 of the City Code and creates a Youth Leadership Council that will serve in an advisory capacity for both the Mayor and Council and help bridge the gap between elected officials and the city’s youth.

The interns were recognized during the meeting for their outstanding work this summer

The item reads as follows:

“I am elated with this today,” Councilor Jay Roberson said to the group of interns. “I want to commend our interns and everyone that helped these young people to come together with this item that will help young people be more engaged with their local government. This is a huge step forward for our city’s youth and I am very proud of the great work you all have done.”

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Tweets from The Birmingham City Council in Birmingham, Alabama

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Birmingham City Council

Birmingham City Council

Tweets from The Birmingham City Council in Birmingham, Alabama

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