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Sponsored by: Hunt <br /> CITY OF SEWARD,ALASKA <br /> RESOLUTION 2016-003 <br /> A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, <br /> ALASKA, AUTHORIZING THE DEFEASANCE OF $3.5 MILLION OF <br /> 2008 LONG-TERM CARE FACILITY REVENUE BONDS IN <br /> CONJUNCTION WITH THE UPCOMING REFUNDING AUTHORIZED <br /> IN THE CITY'S RESOLUTION NO. 2007-050, AND APPROPRIATING <br /> FUNDS <br /> WHEREAS, the City of Seward, Alaska (the "City") issued $27,000,000 principal <br /> amount of Long Term Care Facility Revenue Bonds, 2008 (the "2008 Bonds") pursuant to <br /> Resolution 2006-28 (the "2006 Resolution), as amended by Resolution 2007-050 (the "2007 <br /> Resolution"); and <br /> WHEREAS, as of January 18, 2016, the outstanding balance on said bonds is <br /> $23,250,000, with $20,490,000 slated for refunding on February 2, 2016, as authorized by <br /> Resolution 2015-115 which provided for the issuance of long term care facility revenue <br /> refunding bonds in the principal amount of not to exceed $25,900,000 to refund certain <br /> outstanding long term care facility revenue bonds of the City, fixing certain details of such bonds <br /> and authorizing and providing for related matters; and <br /> WHEREAS, the finance director, in consultation with the City's financial advisor and <br /> bond counsel, is recommending the defeasance of$3.5 Million of said bonds, to take advantage <br /> of the timing of a refunding, to reduce the amount of principal borrowed for the bonds in order to <br /> reduce the lifetime borrowing costs associated with this borrowing, and to reduce the annual debt <br /> service payments over the remaining life of the remaining bonds; and <br /> WHEREAS, the Seward Long-Term Care Facility Fund maintains sufficient cash to <br /> make this lump-sum contribution toward debt service, plus provide an adequate bond reserve <br /> equal to one years' annual debt service payments; and <br /> WHEREAS, a contribution of$3.5 Million will reduce the anticipated borrowing from <br /> approximately $20.5 Million to $17 Million and will generate a lifetime savings of$1.3 Million, <br /> resulting in a reduction in the average annual debt service payment of approximately $273,709 <br /> over each of the remaining 17.5 years of the bond. <br /> NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF <br /> SEWARD, ALASKA: <br /> Section 1. The City Council hereby authorizes the defeasance of $3.5 Million of Long <br /> Term Care Facility Revenue Bonds, 2008 as part of the overall refunding of revenue bonds <br /> authorized by Resolution 2015-115, for the purposes of refunding all or a portion of the <br /> outstanding 2008 Bonds. <br />