News from City Hall
City Communications Office
City of Kansas City, Mo.
FOR IMMEDIATE RELEASE: Sept. 27, 2013
City completes $65.690 million special obligation bond issuance
The City of Kansas City, Mo., successfully issued a total of $65.690 million in special obligation improvement and refunding bonds on Tuesday, Sept. 24. The bonds were issued in two series: Series 2013B was issued as tax-exempt in the amount of $46.2 million, and Series 2013C was issued as taxable in the amount of $19.490 million.
The proceeds of the Series 2013B bonds will be used to complete the funding for the East Patrol Police Station and Crime Lab, fund infrastructure improvements in the Columbus Park area, and lighting and sound improvements at Municipal Auditorium. The proceeds of the Series 2013C bonds will be used to finance the construction of the Soccer Village in Swope Park, fund improvements in the City Market area as well as provide funds for repayment of a variable rate note originally issued to finance land acquisition in the East Village redevelopment area. The Series 2013B bonds were also used to refund two outstanding bond issues in the amount of $35.095 million to achieve debt service savings, on a present value basis, totaling $2.35 million or 8.65 percent of refunding principal.
The effective interest rates for the Series 2013B bonds and 2013C bonds were 3.42 and 4.72 percent, respectively. The underlying credit ratings on the transaction were AA- and A1 by Standard & Poor's and Moody's Investors Service, respectively.
"While interest rates have risen slightly in the last few months, the City’s cost of borrowing for these important projects remains very low,” said Mayor Sly James. “Each piece of this financing will have a significant impact on our continued efforts to make Kansas City best.”
The City used the negotiated method of sale with JP Morgan Securities serving as senior manager of the underwriting team along with George K. Baum and Company, Rice Financial, and Valdes and Moreno. FirstSouthwest and Moody Reid Financial Advisors served the City on the transaction as co-financial advisers. Kutak Rock LLP and Hardwick Law Firm, LLC served as co-bond counsel. Disclosure counsel was handled by Gilmore & Bell, P.C. and Martinez Madrigal and Machicao, LLC. Bryan Cave LLP served as counsel to the underwriters.