Released by the City of Tyler:
TYLER, TX - During their meeting on Wednesday, Nov. 10, the Tyler City Council authorized City staff to pursue the potential of refinancing or refunding $11,090,000 in bonds from the Water and Sewer System Series 2002 revenue bonds to receive more favorable rates.
Due to lower anticipated rates and the City's AAA bond rating, it is anticipated that the City of Tyler may be able to achieve savings of up to $421,000 for their utility system
City staff will meet with rating agencies later this month to negotiate pricing for early December and will request the City Council's authorization to reissue the bonds at their Dec. 8 meeting.
"This is a tremendous opportunity for Tyler to leverage our strong bond rating and current economic conditions to save the City money in the long term," said Tyler City Manager Mark McDaniel. "This is part of our ongoing effort to examine all facets of our financial situation to ensure we are taking of any advantage to keep our financial position strong."
The bonds that will be refinanced are revenue bonds which are not paid for with tax revenue. Rather, revenue bonds are repaid with income from the sale of water and sewer services. The City of Tyler paid off all tax supported debt in 2008 so all sales and property tax revenue collected is used for current operations.