The Prairie Village city council on Monday approved a series of steps to move forward with issuing bonds to fund construction of a new $10 million public works facility at 3535 Somerset Drive.
The approvals come just after the city received a AAA bond rating from Moody’s — the highest rating offered — with respect to the bond issuance. Mayor Eric Mikkelson said Prairie Village’s existing low debt and strong financial position contributed to the rating, and cited the work of individual staff and council members as key to the success. Those staff members included Finance Director Lisa Santa Maria, City Administrator Wes Jordan and Assistant City Administrator Jamie Robichaud. Mikkelson also lauded the work of the city’s finance committee, which is chaired by Councilman Dan Runion.
“I think we can all take great pride and should take great pride in that result,” Mikkelson said.
However, the bid put forward for approval on Monday didn’t garner unanimous support, as Runion and two other members of the council raised questions about the interest rate the city would pay.
Adam Pope, a Columbia Capital Management financial advisor, said bids for the bond were accepted starting at 10:30 a.m. Monday morning. The city received three bids, and the winning bidder was FHN Financial, a Tennessee-based bank, at a 2.89% interest rate and an amount of $9.89 million.
Prior to the approval of the bid, Runion said he would be in opposition to the motions because the bid on the table would cost the city more than what had been projected during discussion at a prior council meeting.
“This is an act to approve a higher interest rate than what we were illustrated was available with a 20-year [bond],” Runion said. “In the process of doing so, [we] are choosing to spend an estimated $1.7 million additional for interest cost.”
Councilmembers Ted Odell, Sheila Myers and Runion voted in opposition the motions to move forward with the bond issuance. Councilmember Terrence Gallagher was absent.
Kevin Wempe, an associate with Gilmore Bell, said that upon approval, the process could move forward with a potential closing date of Dec. 19. The bid, ordinance and resolution were all approved.