The city of Ripon could see a “pretty significant savings to the water utility” moving forward.
That was the message relayed to the Common Council Tuesday by Phil Cosson of Ehlers and Associates, Inc. Cosson had previously spoken to the council two months ago, when he discussed refinancing some of the city’s general obligation debt.
“We're looking at about $120,000 in [present value] savings over essentially the next eight years; this debt will be outstanding,” he said. “We're not looking to extend the debt out longer, we're not going to shorten up the timeframe for the debt. But rather, we're going to look to just replace a little bit higher interest rates with where rates are today.
“We're projecting about $120,000 in savings; it probably equates to about $14,000 a year or so on an annual basis.”
Cosson added that his company is not projecting a significant change in interest rates.
If the resolution authorizing the issuance and establishing parameters for a sale not to exceed $3,005,000 for water system revenue refunding bonds was passed at the meeting, he said the city would “hopefully realize a significant savings for the water utility.”
The sale of the bonds would take place March 10 assuming it hits parameters and the city signs off on it.
In the case the market would move for whatever reason and Ehlers and Associates doesn’t think it’s going to achieve a significant savings, Cosson noted it would delay the sale of the bonds and even cancel it at no cost to the city.
If anything, however, he expects a little better than what it projected even at this time.
After Cosson finished presenting the information to the Common Council, Ald. Jolene Schatzinger asked where the savings would go. City Administrator Lori Rich noted the water utility is a separate fund and because funding comes from rates from the utility customers it has to stay in the water utility.
Schatzinger then asked if Ripon citizens are going to see a savings, to which Rich replied “we’re not adjusting rates” and that this is the debt the water utility has to pay.
“This will help the water utility have a little bit of surplus instead of being very tight,” she said.
The Common Council unanimously approved the resolution authorizing the issuance and establishing parameters for a sale not to exceed $3,005,000 for water system revenue refunding bonds.