Print this story | E-mail story | This story has 5 comments Add your own | iPod friendly
City’s bonds sell on 1st day
Andalusia earns ‘A’ rating from Standard and Poor’s
Published Wednesday, September 2, 2009
The city of Andalusia’s bond issue sold out Tuesday, the first day it was offered.
Mayor Earl Johnson said it was amazing how the $6.25 million deal came together. The bond issue will fund several projects, including renovations at Church Street School, utilities upgrades and road work on River Falls Street, and improved athletic facilities at Johnson Park.
“You will recall that Merchant Capital advised us to go to New York and meet with Standard and Poor’s,” he told city council members. “We wanted to get our bonds rated because that made them easier to sell.”
Johnson said there was a good chance the bonds would have been rated “triple B” if the city hadn’t made a personal appearance with Standard and Poor’s.
“That’s not anything to be ashamed of,” he said. “But we thought we could get them rated A-minus or A-minus-minus.”
Johnson, city clerk John Thompson and Ken Funderburk of Merchant Capital met with S&P in New York the last week of July.
“Two weeks later, we received an ‘A’ rating,” he said, adding that it is an excellent rating for a city of Andalusia’s size.
While in New York, the Andalusia team also met with an insurance company. Once the bond was rated, the insurance company agreed to insure the bonds at three-quarters of a percent, or approximately $90,000 over the life of the bond.
Tuesday morning, Merchant Capital called city hall for the final OK. By the time the council met at 5 p.m., the bonds were sold.
“Fortunately for us, the Dow went down Monday, and people were putting money into the bond market today,” Johnson said. “It worked out well for us.”
Johnson said that in the meeting with Standard and Poor’s, the two main questions were about the city’s reserve fund, which was depleted last year, and about the stability of Shaw, the city’s largest employer.
In its published rating, S&P stated, “We consider Andalusia’s financial position good, evidenced by its strong reserves and historically sustainable sales tax revenue stream.”
The bonds and proceeds will be finalized in the next two or three weeks, Johnson said.
In reviewing the city’s financial statement for the month ending July 31, the 10th month of the current fiscal year, Thompson said that revenues are $338,000 higher than budgeted, while expenses are $152,000 over budget. Footnotes to the financial statement show that most of the additional expenses could be attributed to street lights and special projects.
In other business, the council:
• Awarded the low bid for construction of its access road into the industrial park to Grady Rawls and Son, Inc. The company’s bid was $1.28 million, a figure that was $140,000 below the original estimated cost of construction.
• Agreed to move its first regularly scheduled meeting in October to Mon., Oct. 5.
“I hope y’all will consider doing this,” Johnson said. “I’ll tell you the truth. Troy plays UAB that night at 6 p.m. and I plan on being there.”
Comments
Posted by jujaphillips (anonymous) on September 2, 2009 at 6:42 a.m. (Suggest removal)
I can't believe the city has bonds to sell. Sounds good to me. You go mayor and ROLL WAVE ROLL!!! I'm a 1968 AHS graduate, 1972 TSU graduate, and a 1976 graduate of UAB. But most of all I'm an avid AUBURN fan and could never pull for the Blazers. And of course, I always pull for my hometown, Andalusia. GO DOGS!!
Posted by AndalusiaWatcher (anonymous) on September 2, 2009 at 12:04 p.m. (Suggest removal)
Mayor Earl Johnson has done an "Outstanding" job for the future of Andalusia and Covington County. Now Wall Street knows that Andalusia is a good investment, small in size, but with a good income, dosn't get any better than that in the bond market. Now with the re-development of the light industrial Alatex Park and Riverfalls Street entrance, lighting, and proposed features Andalusia will take on the 'look' of a progressive city on the move thanks to this current city administration and its people. Maybe if all goes well and business began to locate there, and they will, it would be just that easy to next promote a 'New Stadium' in Andalusia, complete with dome for super events and tourism. Maybe one day one of those Troy games could be held in Andalusia, they already have a campus here, never think too small, Long Island used to be a corn field. Job well done Andalusia!
Posted by outlaw11 (anonymous) on September 2, 2009 at 6:22 p.m. (Suggest removal)
Well, that is all well and good, but, when campaigning, he stressed that he would help the seniors as he was/is becoming one; I have not heard one word nor seen one step being made by his office to help the seniors nor alleve the demands made on them in the matters of utilities and/or any other services. It has so far read just like his former administration, me,me,me, and we have seen a hike of the 'adjustment charge' go from 8% to 25% and he does not even comment on this as he is too busy doing what he called our former Mayor guilty of doing, improving the looks of the city...get off your ass, Earl, you make too much money to continue screwing the seniors, and, by the way, a few years ago, you and your wife, paid for Strickland to do a Bronze statue for Troy, now you want one for the ALATEX, sign a check...otherwise, get back to business taking care of your promises...Earl, some of us actually went to war...think about it.
Posted by andalusiainquirer (anonymous) on September 2, 2009 at 7:12 p.m. (Suggest removal)
Earl gave a sweet heart deal to the ballet , which was in the process of building their own building, so he could push a group of local citizens out the door who had worked for several years to restore Church Street School as an arts center. Oh course he identified them with the last administration so they had to go. Some where in this deal is a hidden quid pro quo and involves at least two other lawyers beside Earl. Look for Larry Strickland's name to pop up in this deal real soon. Some of us know that Earl ain't any where what he is crack up to be.
Posted by outlaw11 (anonymous) on September 2, 2009 at 9 p.m. (Suggest removal)
OK, for the record, in Earl's first admin, he played the two art leagues,VALA & LAAC, against the ballet, which I was part of...& part of VALA...he was very vague/politican/both sides of the track...played Jo Kelley against Steve Bryant, both whom did not know we were suppossed to be at odds, and Jo represented LAAC and Steve represented the ballet and VALA, without knowing he was suppossed to...It was ugly...now, after MaryAnne and Steve met with Walter McKee on several occassions in ref to this project, after several blueprints were printed , Earl told them to come to terms, that he had no no opinion of it. Now, in 2009, Mayor Johnson all of a sudden has an opinion...and...he is involved in redevelopement..oh,how do you say "hello" in Korean?
Post a comment (Terms of Use Policy)
(Requires free registration.)