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An ordinance was adopted at Tuesday's City Commission meeting authorizing the issuance of the certificates of obligation in the principal amount of $1.9 million from the city to the Texas Water Development Board (TWDB).
Andrew Friedman with Southwest Securities told the commissioners that it was time to authorize the federal interest rates. The principal amount of $1,935,000 would be paid in 2015 to minimize the impact, with $19,000 of that amount being interest. The total amount would be under a 20-year debt service agreement.
The TWDB is pleased with the rates, which initially saw an increase but were down for a few months and now remain flat. But in the past week, the rates fell slightly.
Recently, the Standard and Poor's rating service raised the city's bond ratings from "A" to "AA-"--a two-notch increase. Sweetwater City Manager Eddie Brown shared the news as part of his monthly report at the meeting, in that the letter from December 15 arrived at the city sometime after Christmas.
Since the current numbers are based on the previous rating, Friedman said that they should adopt the amount, but would then see if they were able to get a lower interest rate due to the new rating. Further action may be required if the rate was lowered.
The funds would then be delivered on February 18 in order to move forward with the project. The money from the TWDB will be used for the development of the Hunter Well Field.