City commissioners passed a resolution to refinance $5.5 million in general obligation bonds that will save the city in interest.
Commissioners passed the consent agenda and the general agenda Tuesday with a 4-0 vote in an unusually quick half-hour session.
The refinancing of $5.5 million in general obligation bonds was added at the last minute to the consent agenda. The refinancing of the bonds at a lower interest rate will save the city between 3 and 5 percent in interest payments, said Ron Fehr, city manager. He estimated the change could save the city as much at $350,000.
The decision to seek a better interest rate followed another agenda item related to financing: a search for low bidders to finance $12.8 million in temporary notes that needed to be converted into general obligation bonds. The low bid for the temporary bonds was approved at an interest rate of 1.67 percent. This led the city finance department to seek better rates for other general obligation bonds, and city officials felt they needed to act before the end of the year to reap the savings.
“Six months ago in May, [the interest rate] was 2.86 percent,” Fehr said. “So, it has come down substantially, which will generate some significant savings for the city.”
Fehr said in order to move the refinancing along quickly, the city will need to hold a special session next week on an ordinance that will allow the mayor to enter into the new financing agreement.
On the general agenda, the only concern city commissioners had with the rezoning of Highland Meadows addition was the potential added water drainage from the property into Wildcat Creek. Eric Cattell, assistant director for planning, said the drainage rate would not change from its current rate because of a drainage pond on the development.
With that assurance, city commissioners passed the rezoning ordinace, which changed 4.61 acres of the Highland Meadows Addition from a single-family residential district to a two-family residential district.
As a result, the Highland Meadows Addition will have a row of duplexes along the east side with single-family homes on the west side.