According to this morning's Standard-Examiner story, Ogden City got a great deal yesterday on its new $49.1 million water infrastructure bonding, as is reported by Ace Reporter Schwebke in his morning story, "Wall street helps Ogden's interest rate on bonds." Here's the lede:
OGDEN — A nearly 200-point drop in the Dow Jones industrials on Tuesday will likely save the city about $2.5 million in interest payments for a bond package to fund sweeping water and sewer infrastructure improvements, municipal officials say.Market timing is tough even for the most seasoned investors, though. Look at what happened to the Dow today, however:
The city council adopted a resolution Tuesday night to proceed with the sale next month of $49.1 million in bonds to finance the improvements.
Mike Goodwin, the city’s treasurer, said Tuesday’s tumble on Wall Street prompted skittish investors to turn to more secure municipal bonds like the ones being marketed by Ogden.
“Municipal investors looked at our options,” he said. “It was very good for us.”
Wall Street stumbled Tuesday after oil prices spiked to a new record above $129 a barrel and a government report raised investors’ concerns about the impact of inflation on consumer spending.
Jerry Nowlin, a senior vice president for Wells Fargo Brokerage who is assisting the city in marketing its bonds, said about 15 major investors committed Tuesday to buy from Ogden. “We had more buyers than bonds (available),” he told the city council.
As a result, the city was able to negotiate a slightly better interest rate on its debt service payments, estimated to save about $2.5 million over the 30-year life of the bonds, he said.
The Dow was down another 227.49 (1.77%). Obviously we're in a declining investor market.
Although it might be suggested that the Ogden bond underwriter (Wells Fargo) might have waited another day or two before nailing down investor commitments... we're not going to say that.
Our main gripe, even with these market-driven and highly fortuitous rate reductions, is this:
Prior to 2005, Ogden City was set up to finance water system infrastrastructure improvements from Business Depot Ogden (BDO) lease revenue. These bond payments could have been largely paid from BDO revenue under the arrangements at that time, rather than from taxpayer-paid water rate increases, if original commitments had been kept.
Instead, Boss Godfrey, in his "visionary" risk-taking mode, persuaded the former "gang of Five Counsel," rubber stamp Godfreyite lackeys at that time, to re-commit BDO revenues to the "Wreck Center Project."
How's that project doing, BTW, we ask. Does anybody really know?
Recent reports indicate Ogden City taxpayers are now on the hook for at least four "Junction" $3/4 million bond payments, notwithstanding whatever paltry payments are now being made by the very few existing"Junction" tenants.
Three cheers for the soccer moms, gondolists, sheeple from the wardhouses and otherwise brain dead Godfreyites who lifted the little twerp to a third term as Ogden Mayor in the last election.
What a shame it is that these nitwits can't be personally assessed for the future economic damage they will will have have caused to Emerald City.
