City approves bond issue for projects
An ordinance was approved by the Garden City City Commission meeting Tuesday to make improvements to the public water system and parks and to acquire public safety and fiber optic communications equipment.
The commission approved the issuance of general obligation bonds to pay the cost of the improvements.
One of the projects is a 2020-2021 water system improvement to construct a 16-inch water transmission line from 4th Street and Maple Street to the Jameson Energy Center.
The estimated cost for the project is $2 million.
Another project is for improvements to be made to SE Community Park and playground, which will include ADA accessible public restrooms, shade structures, playground equipment, walking pathways and related amenities.
The project is expected to cost $1 million, plus issuance costs.
Garden City city manager Matt Allen said SE Park is a community park that “would be on par with the likes of Deane Wiley Park.”
It was identified several years ago for necessary improvements, Allen said. Financing for the project would bring the park, which is only partially improved, to “close to fully improved.”
One other project included in the ordinance is to acquire a 2021 Pierce Enforcer Pump and related equipment. It’s expected to cost $800,000, plus issuance cost.
Melinda Hitz, Garden City finance director, said the city was going to do a lease-purchase over 10 years, but historically general obligation bonds have a lesser interest rate than a lease-purchase, so they’re “authorizing that project to be in the ordinance.”
The last project is for a dedicated fiber optic to Garden City Regional Airport to enhance emergency response and communication. It’s expected to cost $1 million, plus issuance cost.
Hitz said the decision to finance these improvements came due to very low interest rates.
“We currently have some refunding issues that we can look at, so it would be to our benefit to issue some new money issues that we could combine with these refunding issues,” she said. “So we took a look at some projects that we currently have in the city now that we're going to need debt financing on.”
Currently there are six bond issues outstanding for the city that can be refinanced for a savings of $135,000, Hitz said.
“It’s very rare for the city to have something that we can call because our interest rates are normally pretty low and then the bond issue is pretty short,” she said. “We have a pretty good opportunity here to have some savings.”
It’s a good thing, Allen said. It allows the city to take advantage of the low interest rates but to “save not only in the refinancing of those bonds but we’ll also save a pretty significant amount of money in the cost of issuance.”
Hitz said the project all all part of the city’s Home Rule Authority, so if the projects are approved they will be part of the 2020 general obligation bond issue.
Also included in the bond issue is the redemption of the 2020 Temporary Note for the aquatic facility and the Eastside Drainage project.
The general obligation bond sale is scheduled for Oct. 20, with a closing on Nov. 17.