The Weatherford City Commission approved 5-0 to issue a sales tax revenue note for $13.315 million. Money will be paid back using the Yes Weatherford sales tax revenue collected. The city will make two payments per year from 2021 through 2030
The Weatherford Public Works Authority also was required to pass this item, which they did, 5-0.
The city will pay 1.35-percent interest on the money it’s borrowing.
“We received one full proposal from Truist Bank,” Chris Gander, BOK Financial Securities, Inc., senior vice president, said. “We ran our models (on the 1.35-percent) and the interest is about $1 million.”
Before approving the item, Ward 3 Commissioner Warren Goldmann asked “Why does the city borrow the money for the other entities?”
Mayor Mike Brown answered by saying, “We’re only borrowing for our own projects.” He continued by saying the city collects the money and writes the other three entities, Southwestern Oklahoma State University, Weatherford Public Schools and Weatherford Regional Hospital, a check every month after money is received from the state.
The item also has a listing of scheduled payments. Payments will be due June 1 and December 1 of each year from 2021- 30.
The first payment is due June 1, 2021, for $570,000. Payments vary throughout the length of the loan with a stepped increase. Final payment is due December 1, 2030, for $740,000.
BOK was hired by the Weatherford Public Works Authority during last month’s meeting to handle the issuance of its Sales Tax Revenue Note, Series 2020 in the principal amount of $13.315 million for the purpose of financing various capital projects, along with related costs and paying costs associated with the issuance of the note.
Chris Gander, senior vice president and investment banker with BOK, said with the commission approving this resolution, BOK could begin to solicit bank notes.
In July, Gander said BOK will try to get a bank note instead of bonds for this money.
At Friday’s meeting, Gander said, “This is 10 years, banks are interested.” He added the cost to the city is less as well with fewer fees and not having to hire an underwriter.
Mayor Brown said “This is less cost to the city.”