HomeMy WebLinkAboutWATER BOND SALE 11-21-83DATE:
Nov. 16, 1983
Inter- Corn
SUBJECT:
HONORABLE MAYOR, CITY COUNCIL, BILL HUSTON, JIM ROURKE & RON
NAULT
DICK EDGAR, COUNCILMAN
DISBURSEMENT OF PROCEEDS FROM THE WATER BOND SALE
In conversation wi~h Ron Nault about a final accounting of the disbursement
of the proceeds of the sale of bonds by the Tustin Water C6rporation, it
appears that some indecision presently exists. The precise bond proceeds
are $4,410,113 indicating the discount in the sale. A sum of $3,687,340
has been paid to the former shareholders. This is composed of the annual
payment of about $459,000 due on November 1, 1983 and the balance of the
debt~ Also disbursed is the issuance expense of $153,171 and the reserve
fund of $450,000.
~n order to satisfy the use of bond .proceeds as described in the Official
Statement, $300,000 must be repaid to the City for the debt retirement paid
in 1981. In order to dO this, $180,398 from the debt surcharge fund should
be added to the balance of the'bond proceeds which is $119,6U2. This is
fully compliant to Council direction that the debt surcharge fund be used
to repay debt.
In addition, two outstanding obligations presently exist. About $20,0U0 is
due for the final printing of the Official Statement and has not yet been
billed. Also, ~here is a contested item in the schedule of adjustments.
At risk is $110,000 of accrued developer advanced refunds plus 3 years of
accrued interest. Jim Rourke is presently involved in resolving this issue
and payment might be required. Since both of these items relate to the
bonds and purchase price, I believe that they should be debits against the
debt surcharge fund.
On Monday, November 21st, I intend to formerly move acceptance of these
items.
RE:dmt