HomeMy WebLinkAboutItem #45 - Discussion Item..
011`Y bF MIAMI, ~LOF11bA
r INfi~q~n~~l~~ M~MCygANDWM
H~f~~~~b~ I~ar~t~r ~nc1 Meinb~r~
~~ : ~~ the ty C~`mmissic~n batE ~ ~~~ 4 ~ ~~~~ ~r~€
., ~ SUbJEGT : ~~ty CCf~i11Ai~~~n
At~efld~t ~~~tCl
KFi6M ; ~e~~r H. Odi~i R~~~FtEN~ES
bity Manager
ENCLOSURES:
R~GbM~+tENbATION
~~ It is respsctfull`y recommended that the attached., resolution
authorizing .the substitution of~a Reserve Account Surety Bond for
cash on deposit in .the Debt Service Reserve Account seducing
~~ the City's oiutstanding. Guaranteed .Entitlement Revenue Hnnds,
Series 1989, and directing .the depository of the Debt .Service
.Reserve Account to accept such surety bond; approving the form,
~~ execution and delivery of a financial .guaranteed agreement;
~' directing. the application of the cash .released as a result of
such substitution; authorizing further official actions to effect
` such substitution; authorizing the appointment and payment of,
special counsel to the City; providing severability; and
providing for an effective date, be .approved.
BACKGROUND :.....
'~; The .City issued $6,500,000 Guaranteed Entitlement Revenue Bonds,
Series .1989 on June 15, 1989. The bonds were insured by
Municipal Sond Investors Assurance Corporation (MBIA), making the'
bonds AAA rated.
Thee trust indenture for the bonds required a debt service reserve
~~ account equivalent:. to the highest" annual `debt service which
r". .
I~ _ approximates $612,000.
~'
~; At this time MBIA has agreed to issue a reserve account surety
.bond in substitution for the cash on deposit'in the debt service
reserve addount, at a premium of 4$ of the surety bond amount; to
~' be .,paid .:.from the funds released by the placement of the surety`
bond. There~leased cash will be used. to fund debt service
`` payment.. for-these bonds,: of 'which approximately $391500'Wi~1 be'
paid this fiscal year, and $196,000 will be-paid next fiscal
:i year.> This:....transaction will save`the.'General Fund $587,500' in
debt service payments.
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