BENTON - City officials finalized the sale of more than $37 million in bonds Monday that will finance construction and upgrades for Benton parks.
Aldermen approved the sale of the bonds, the use of the money to pay for the parks projects and the annual payment amount during the City Council meeting. Alderman Jerry Ponder - who works as a loan officer for First Security Bank, which was named the bond trustee - abstained from the vote, and Alderman Charles Cunningham was absent.
The city will receive the money April 15, Mayor David Mattingly said.
Voters approved a half-percentage-point salestax increase in a Nov. 12 special election to pay for the bonds, which will fund improvements to Holland Park and the construction of a new park complex called Riverside Park.
The projects, estimated to cost just more than $36 million, include a softball complex with five fields, a three-field soccer complex, a community center, an aquatic center, a new Boys and Girls Club, and a senior citizens center, Mattingly has said.
Earlier this month, city officials decided to contract with Black Corley Owens & Hughes Architects, a Benton-based company, to design the expansion of all municipal parks. Officials planto meet with the architectural firm Wednesday to finalize the contract, Mattingly said.
Stephens Inc., which handled the city’s bond sales, opened up the first sale period from 9 a.m. to noon Monday to give individuals, including any residents, a chance to buy bonds, said Jack Truemper, senior vice president of the public finance department at the investment company. He added that about $8 million was raised during that period.
About 12:30 p.m., Stephens opened up sales to specialized companies, such as mutual-fund businesses and banks, which raised the remaining amount, he said.
City officials have worked since August to secure financing at a good rate. When the proposal was initially presented in August, the city was looking at a 4.8 percent interest rate and an annual payment of about $2.4 million, officials have said.
But after receiving a good bond issue rating through Standard & Poor’s and insuring the bonds, city officials were able to reduce the interest rate to 4.16 percent and the payments to nearly $2.2 million, officials have said.
According to Truemper, the city will begin paying interest twice a year Dec. 1 and the principal annually June 1, 2015. Benton has 30 years to pay the bonds off, but with the new rates, the city is estimated to pay $6 million less over that time span, officials have said.
Ponder later said all other things being equal, he would fully support the measures approved Monday night.
“It’s a wonderful day for us and a wonderful opportunity for our city,” he said. “I’m very excited to see what the future holds.”
Mattingly compared the process to getting a loan to buy a new home.
“Here we are seven months later,” he said. “We’ve got it done.”
Arkansas, Pages 9 on 02/25/2014