2.3 ERMUSR 07-12-2016 - Laserfiche WebLink

Home Browse Search

2.0 CONSENT AGENDA(Approved By One Motion) John Dietz had a few questions on the Electric Cost-of-Service and Rate Design Study, staff responded. Al Nadeau moved to approve the Consent Agenda as follows: 2.1 May Check Register 2.2 May 10,2016 Previous Meeting Minutes 2.3 Financial Statements 2.4 2015 Consumer Confidence Report 2.5 Wellhead Protection Plan Implementation Evaluation and Work Plan 2.6 Consulting Services for Electric Cost-of-Service and Rate Design Study Daryl Thompson seconded the motion. Motion carried 3-0. 5.1 Award of Bonds 2016A and Refunding of Electric Bonds 2016B At the May 10th meeting, the Commission passed a resolution to proceed with the issuance of$10,000,000 2016A bonds, and the refunding of the bond 2007A issue of$1,460,000 2016B bonds, and the City Council passed it at the May 16th meeting. At that time it was identified that the award of the bonds by the Utility Commission would come back and be on the June 14th agenda. Proposals for the sale of the bonds were received this morning, June 14, until 10:00 a.m. Terri Heaton from Springsted presented the market sale information results. For the 2016A Electric Revenue Bonds, subsequent to bid opening,the issue size decreased from $10,000,000 to $9,755,000 due to a premium with the offer. Terri presented the bids and announced that the Wells Fargo Bank, National Association came in as the low bidder with a true interest rate of 2.31%. For the 2016B Electric Revenue Refunding Bonds, subsequent to bid opening,the issue size decreased from$1,460,000 to $1,370,000. The Robert W. Baird& Company, Incorporated was the low bidder with a true interest rate of 1.32%. Terri shared that based on the lower interest rate and reduced underwriter fees, the final results of the bond refunding reflected a total savings of$94,737. The rating call for both bonds was conducted on May 31St. It was decided to stay to with Moody's for rating purposes; we currently have an Aa3 rating. Terri shared that ERMU staff did a fabulous job on the rating call and really represented the utilities well. Teri pointed out the highlights in Moody's review, which included ERMU's credit strengths and credit challenges. Based on the information reviewed, Moody's has assigned an Aa3 rating to ERMU's $11.5 million Electric Revenue Bonds, Series 2016A and Electric Revenue Refunding Bonds, Series 2016B. There was discussion on the rating. Troy Adams pointed out that Theresa Slominski and her staff put a great deal of effort into putting together the packet used for the rating call, and that along with years of good utility decision making is Page 2 Special Meeting of the Elk River Municipal Utilities Commission June 14,2016 24