Clovis to look at refinancing bonds
May 20, 2020
CLOVIS — City commissioners will look at more than $500,000 in savings to refinance two bonds over the next 22 years, and an opportunity exists to frontload the savings.
Their 5:15 p.m. meeting at the North Annex of the Clovis-Carver Library will be virtual due to public health orders regarding mass gatherings during the COVID-19 pandemic.
The meeting will be broadcast on Suddenlink Channel 10, cityofclovis.org and the city Facebook page. Questions can be called in to 575-763-9200.
A resolution put before the commission calls for a $9 million loan agreement with the New Mexico Finance Authority toward a 2010 loan for wastewater treatment plant improvements and a 2011 loan that funded the purchase of Colonial Park Golf Course and various other parks and recreation projects.
“With interest rates being low,” Clovis City Manager Justin Howalt said, “we’re looking at the ability to restructure or refinance those 2010 and 2011 series loans.”
The city would have two possible options on each loan:
n A simple refinancing at a lower rate, which would save roughly $323,000 on the 2010 loan and $221,000 on the 2011 loan. The loans expire in 2030 and 2031, respectively.
n Adding a year of debt service payment to each loan, which would still result in a lower interest rate but frontload much of the $570,000 in savings to the first two years. The extended loans would expire in 2031 and 2032.
The process, Howalt explained, is similar to when a finance company offers to waive a December car or home payment and extend the loan period by a month. The customer gets holiday spending money, while the lender gets to compound more interest on the briefly frozen principal. In this case, the holiday equals the upcoming years with finances expected to be tight due to the COVID-19 pandemic.
The commission will also consider a resolution to provide hoteliers relief by reducing sewer fees — allowed in state statute for structures that are vacant. The hotels have been forced to operate at lower occupancies, first 50% and followed by 25%, by state public health orders. The measure is expected to cost the city about $4,500 monthly.
Other items on the Thursday agenda include:
• Disbursement of lodgers’ tax funds as determined in the advisory board’s May 12 meeting.
A total of $81,265 is recommended, including $25,000 for the Curry County Fair, $13,300 for the Christmas Lights Parade, $28,000 for advertisements in state tourism magazines, $8,000 for the holiday bazaar and $6,965 for the Double Dash barrel race.
• A $59,213.13 agreement with Consensus Planning to create a metropolitan redevelopment area plan. The city has been awarded $50,000 from the state toward the work.
• A request to allow alcohol sales in Hillcrest Park for the 575 Food Fest and Under Over Festival, which are both scheduled for 11 a.m.-5 p.m. Oct. 17.
• A request to award Region V Drug Task Force coordinator duties to Roger Grah. He was the only applicant for the contract, which will be for one year with three additional renewal options. The contract amount is still to be negotiated.
• A bulk diesel contract with Farwell Fuels for $1.0728 per gallon. The city uses approximately 7,500 gallons monthly.
• A letter of support in Curry County’s application for Community Development Block Grant funding for Curry Road 11 work.