Refinancing bonds will save city $96,000

By Brian Sanders

The City of Holton will be saving more in interest payments than previously noted with the issuance of $1,895,000 in general obligation refunding bonds to cover the remainder of a 2004 bond issue, Holton City Manager Bret Bauer told the Holton City Commission on Monday.

The savings on interest payments is being generated by lower interest rates for the new bond issue than those attached to the 2004 bonds, which, it was reported, were issued to improve on interest rates attached to a 1999 bond issue.

The 1999 bonds were originally issued to cover the cost of improvements at the city’s electric power plant, including the purchase of two generators that would provide a total output of 6.3 megawatts of power.

At first, Bauer said the city’s initial savings estimate would be $75,000 on the 2004 bonds, which were carrying an interest rate between 3.5 and 4 percent. The city had then received a second estimate of nearly $86,000 in interest savings, noting that the new bond issue would likely carry an anticipated interest rate between 2.5 and 3 percent.

But with the final interest rate on the new bond issue at 1.73 percent, Bauer said the city is now expecting to save $96,000 in interest payments after the costs of the bond issue are figured in.

Also, commissioners approved a pair of documents related to the new bond issue, the first being an ordinance authorizing and providing for the issuance of the bonds and providing for levy and collection of an annual tax for paying principal and interest on the bonds. The second was a resolution prescribing the form and details and directing the sale of delivery of the new bonds.

A public notice containing a summary of the ordinance is printed on Page 11 of this edition of The Holton Recorder.

In other business on Monday, commissioners:

* Approved minutes from their Oct. 5 meeting, as well as budget appropriations made since that meeting.

* Heard a comment from Bruce Rinkes of King Engineering on progress in the Holton Industrial Park road reconstruction project. Rinkes said the first phase of the work is complete, and the second should be finished by mid-November, with all work to be completed shortly before Thanksgiving.

* Met with rural Holton resident Lee Doyle to discuss what to do about an abandoned city sewer line that runs through Doyle’s field, which is located just east of the city (see related story).

* Heard a comment from Commissioner Twila White about what kind of Christmas pay bonus city employees should receive this year, with some discussion following.

* Heard a comment from White about the county’s open burning resolution.

* Heard a comment from Bauer that water is being put back into the Holton Municipal Swimming Pool after more valves were replaced in the light of a leak discovered at the pool this year. Bauer noted that no new leaks have been noticed.

* Heard a comment from Mayor Robert Dieckmann about work done by officers in handling the re-routing of traffic in the aftermath of the Oct. 7 traffic accident on U.S. Highway 75 at Columbine Drive. “They handled that well,” he said.

* Heard a question from Dieckmann on whether the city had attempted to get grant funds for police body cameras. It was reported that three police body cameras were purchased recently through a private donation.

* Were reminded by Bauer that bids for sewer line repair work had been advertised for a second time, with a bid submission deadline of Nov. 13.

* Heard a comment from Bauer that work on the Banner Road extension west of U.S. 75 has begun.

* Heard a question from Commissioner Erich Campbell about the hiring of a police officer and a city dispatcher. Bauer said a new officer (Justin Schmitz) had begun duty earlier that day.

* Adjourned the meeting at 8:05 p.m. All commissioners were present, including Campbell, Dieckmann, White, Dan Brenner and Tim Morris.

The Holton City Commission regularly meets at 7 p.m. on the first and third Mondays of each month in the commission chamber at Holton City Hall, 430 Pennsylvania Ave. For more information, or to be placed on the agenda of an upcoming meeting, call City Hall at 364-2721.