Resolution approving a proposal from Speer Financial, dated April 4, 2012, to provide financial advisory services for the advance refunding of the G.O. Water Bonds, Series 2006.
SPEER FINANCIAL, INC has previously provided financial related professional services for the City and Darien Park District. SPEER assisted the City with the issuance of the G.O. Water Bonds, Series 2006. The City has received an unsolicited proposal from the underwriting firm of Robert W. Baird for the advance refunding of this bond. The process of advance refunding involves selling a new series of bonds to fund an escrow account to retire the callable bonds of Series 2006 on December 15, 2014. Between the time of sale (2012) and redemption (2014), the Series 2012 bond proceeds will be invested in U.S. Treasury securities and held in trust at a bank. Expected savings, net of all costs of issuance, which are paid by the bond issue, is likely to be in the $125,000 range. Savings is dependent upon interest rate movement. Rates today average 2.1%. The professional advisory fee to SPEER, shown on page 12, would be $8,640 and be payable only if the bond closes.
Administrative/Finance Committee and Staff recommend approval of the proposal.
This will be on the April 16th, 2012, City Council agenda for formal approval.