7/1/2013 8:06:00 AM CYFD board swears in Steele, chooses new chairman; considers refinancing bond debt
Central Yavapai Fire District Interim Board of Directors Chairman Bob Gardiner, right, swears in new board member Tom Steele on Thursday during a special board meeting.
Central Yavapai Fire District/Courtesy photo
Lisa Irish Special to the Tribune
The Central Yavapai Board of Directors swore in Tom Steele as a new board member, then elected Steve Rutherford as board chairman and Debbie Horton as clerk at a special meeting Thursday.
After listening to a presentation about bond debt servicing finance options, the board directed administration to look into refinancing at a lower rate about $6 million in general obligation bond debt that is callable July 1, 2015.
Stifel, Nicolaus & Company, Inc. managing director Mark Reader said his team had managed private placements after refinancing other municipalities revenue bonds and the fire district's general obligation bonds between 2 percent and 2.35 percent.
The average rate CYFD is paying now is 4.75 percent, and the refinancing could range from 2.25 to 2.35 percent based on recent bids, Reader said.
That would save the district more than $500,000 over the entire 10-year life of the bond, Reader said.
"Can we front load the payments to pay the bond off early?" Horton asked. "That would make sense to do."
Reader said the bulk of the payments could be moved to the first three to four years, which could reduce the tax rate by 4 to 5 cents, Reader said.
Rutherford asked how quickly they could complete the process, and Reader said 30 days.
After all board members said they'd like to move forward, Rutherford said they would hold a special session to vote on the refinancing.
Then CYFD warehouse manager Frank Van Der Horst made a presentation about the anticipated revenue and costs of the Greater Yavapai Purchasing Consortium.
Afterwards, board members discussed financial options related to the 2013-14 budget, after learning from the county that fire district tax revenues came in $90,000 less than projected, worker's compensation costs rose $60,000, and that the district will save $8,000 next year on insurance.
Because of those pressures, Chief Paul Nies said he knew board members could not keep all the proposed item requests in the tentative budget.
So administrators looked at those items and asked the board to consider replacing the CYTRA manual gate with an electronic one to increase security now that the warehouse is receiving supplies for the Greater Yavapai Purchasing Consortium.
Nies noted CYFD still needs more fire investigators and hoped training for them would still be considered by the board.
Rutherford said he'd like to get a better idea of the district's strategic plan and goals so that decisions made in this budget could support that.
Rutherford noted that 80 percent of the budget was personnel costs, and said he hoped the district would develop more non-tax levy revenue streams like the income from the Greater Yavapai Purchasing Consortium to help support the district.