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MINUTES OF THE FINANCE COMMITTEE <br /> January 21,2020 <br /> East Conference Room <br /> Present: Councilmembers Bullock, Litten, &Neff <br /> Also Present: Councilmember Rader, Acting Finance Director Schuster, Mayor George, Catherine <br /> Swartz of Brickler&Eckler, Jeff Rink of Key Banc Capital Markets, Law Director Corrigan, and a <br /> couple members of the public <br /> Call to Order: 6:05 p.m. <br /> Approval of the minutes of the December 7,9 & 16,2019 Finance Committee meetings. <br /> Chairman Bullock made a motion to approve the minutes from the December 7, 9, & 16 2019 Finance <br /> Committee meetings,which was seconded by Councilmember Litten. All members voted in favor. <br /> Motion passed. <br /> Bond Ordinances Discussion <br /> Chairman Bullock gave an overview of the discussion,noting that the point of the meeting was to seek <br /> that the city's debt issuances are well done and that the city's series of debts are position to max effect <br /> and greatest thrift to the taxpayer. Acting Finance Director Schuster then introduced Catherine Swartz of <br /> Brickler& Eckler and Jeff Rink of Key Banc Capital Markets, who have served as the city's bond <br /> counsel for years. Ms. Swartz and Mr. Rink then led a presentation on the city's debt portfolio. <br /> Mr. Rink noted that the city has a strong credit rating of AA2, as reported by Moody's Credit Rating <br /> Service, which has resulted from the long-time good stewardship of finances. Investors are extremely <br /> comfortable purchasing debt from Lakewood from a credit perspective, which has led to the city to <br /> benefit from good interest rates when borrowing money.Page 5 of their presentation summarized <br /> Lakewood's 2020 debt transaction,which involves borrowing $28 million in the form of 1-year notes, <br /> which has about a 1.80%interest rate assigned to it. $22 million of the $28 million is outstanding debt <br /> and only $5.5 million is for new projects. Much of the borrowing is for water/sewer work that the city <br /> was mandated to do. While the city appears to have lots of debt, the city's portfolio would appear like <br /> many other cities if these water/sewer obligations were stripped away. <br /> Mr. Rink stated he anticipates sitting before the committee next year to discuss the potential to refinance <br /> $6.5 million in debt from 2011 to save the city $70,000 to $100,000 annually moving forward. <br /> Councilmembers discussed interest rate fluctuation with Mr. Rink and Ms. Swartz and posed the <br /> possibility of frontloading projects to take advantage of low interest rates. Mr. Rink and Ms. Swartz <br /> indicated that it would be more impactful to lock in long term interest rates next year and that the <br /> indication has been that interest rates will remain low next year. It was noted that it is good financial <br /> practice to wait until projects have been completed to know their full cost, which better informs the <br /> bonding process. It was added that it may be advantageous to stagger projects over time to make their <br /> maintenance/repair schedules more manageable. <br /> Page 13 of the presentation showed who participates in the sale of bonds,with Huntington Bank acting as <br /> a paying agent that holds the city's note.Page 19 of the presentation showed Moody's score card for <br />