04-13-2020 Council Packet - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, March 30, 2020 6:00 o’clock p.m. _____________________________________________________________________________________ Page 2 of 4 Walsh recognized Gina Paulucci for her donation to the police officers. He also noted all the bids came in with a lesser amount than the City anticipated. PUBLIC COMMENTS None 6. REFUNDING OUTSTANDING 2010A BONDS Rief explained that Olson and himself were in contact with Ehlers & Associates and they did an evaluation regarding outstanding bonds. The 2010A bonds, in the amount of 1.4 million dollars, were eligible to be refunded, which would save the City about $160,000. Based on what the city has in investments and cash reserves, they felt it was a good time to refund the cash reserves over the next five years. Some of the money is MSA funding and the other is a general funds bond. Walsh said the City is fortunate to have money in the bank. He and Rief looked to see what could possibly be paid off early, and the only bonds the City has that are callable are the 2010A bonds for 1.4 million. The $160,000 that will be saved in interest is approximately $23,000 a year. The City also has $145,000 which is in the budget every year for principal payments. There is another $150,000 in the MSA funds. He stated this opens up the budget for other things the City wants to fund. Because it is a line item, it leaves room for flexibility. The City of Orono is run like a business, and their good fiscal responsibility is paying off right now. Johnson asked if there was any concern, going into somewhat of an unknown economy, to be parting with any of the reserves. Walsh said there is so much in reserves currently, $10-$20 million, that the City is sitting fairly good. He noted they are paying 3% interest and this bond would not get paid off until 2027. The line item is being freed up much earlier to take advantage of other things the City wants to get done in the next few years. Rief said he and Olson feel comfortable paying it off and the City is in a good financial position. The $12 million would pay roughly 80% of the City’s expenditures, and all of the requirements are being met as far as cash on hand and in reserve. Johnson said it was more of a rhetorical question and agrees with lessening City debt. Johnson moved, Seals seconded, to approve Refunding Outstanding 2010A Bonds. VOTE: Ayes 5, Nays 0. MAYOR/COUNCIL REPORT Seals stated she is thankful that they are home and can work from home. They survived the first day of distance learning. Crosby thanked Staff for their assistance in getting online and getting everything together. He reminded everyone to get take-out as much as possible to support the small businesses in the area. He encouraged everyone to keep the social-distancing and hand-washing and noted that we will all get through this.