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(Emphasis added.) In addition, SCPPA's bond counsel has advised staff that City Council <br />approval is not required for this bond issuance. Still, we wanted to bring this recent bond <br />issuance to your attention as an informational item. <br />FINANCIAL IMPACT <br />Our Electric Utility's share of the 2006 Bonds is 4.3133% of $37,730,000 or approximately $1.6 <br />million. The repayment of the 2006 Bonds will take place over a 10 -year period at an average <br />interest rate of approximately 4.30%. The average annual debt service payment to the Electric <br />Utility will be approximately $205,000. (This amount has been budgeted in the 2006-07 budget <br />in account 520-8000-8006-2330-0555-900.) The funds that will be reimbursed to our Electric <br />Utility for expenses related to the construction of the facility are approximately $691,096 and <br />will be placed into the Utility's Project Stabilization Fund. <br />The alternative prior to issuing the additional debt was to make a lump sum payment to cover our <br />Electric Utility's share of the cost overruns, replenishment of the Reserve & Contingency Fund, <br />and Capital Improvements scheduled over the next two years. This would have created an <br />additional hardship on the Electric Utility, given the Utility's current low cash position <br />RECOMMENDATION <br />Staff recommends that City Council receives and files this agenda report. <br />TEAM ONLY I <br />rnev: K I . �zICV4� I Finance Director: <br />Manager: <br />OTHER: <br />