7-22-2022 5:29pm

$33 million in 2022 bond funds sold are slated for street improvements

John Dobberstein Editor

By John Dobberstein, Editor

The Broken Arrow City Council has approved a bid to purchase $40 million in general obligation bonds at 3.41% to BOK Financial Securities.

In a presentation of the bids to the council, Jon Wolff of Municipal Finance Services said the $40 million bond sale is the largest general obligation bond sale city has done in the 20 years his organization has been working with the city of Broken Arrow.

“You have about $33 million of that $40 million that is designated for street improvements throughout the City that are essential, and you’ll be able to get out and start working on those at costs that are in the near future, as opposed to further down the road,” Wolff said.

City of Broken Arrow Director of Finance Cindy Arnold said general obligation bond sales typically occur later in the year, “but due to fluctuations in the market and concerns about the interest rate, it was necessary to put the bond out for bid earlier.”

Wolff said the rate on the BOK Financial Securities rate at 3.41% is “good. I think we did well. We’ve had quite a roller coaster with the market in the last six to seven months.”

Over the last 30 days, the 10-year treasury has been as low as .75% up to 3.3%.

On July 14, Moody's Investors Service assigned an “Aa3” rating to the city’s $40 million general obligation bond sale, and noted Moody's also maintains the Aa3 rating on the city's previously rated general obligation unlimited tax (GOULT) debt.

Moody’s noted that following the issuance, the city will have $205 million of GOULT debt outstanding. Moody's also said it does not generally assign outlooks to local government issuers with this amount of debt.

“The Aa3 rating reflects a large and growing tax base fueled by its advantageous location near Tulsa and favorable resident income and wealth levels,” Moody’s said in a statement. “The rating also considers an strong and rising reserve and cash position, a key factor given the city's high exposure to economically sensitive sales tax revenues.

“The city's sales tax revenues have, however, proven to be resilient despite recent economic fluctuations. Additional considerations include a manageable debt profile with a moderate but growing pension liability due to weak annual contributions set by the state.”

Here is the roster of road projects to be paid for with bond money:

Proposition 1

Widen Houston from Garnett to Olive (Construction) $4,720,000
Widen Houston from Olive to Aspen (Construction) $3,600,000
Widen Washington from Olive to Aspen (Construction) $4,140,000
Widen Washington from 9th Street to 23rd Street (right of way (ROW)\Utilities) $200,000
Resurfacing Tucson from 1st Street to 9th Street (Construction) $800,000
Widen 9th Street from Houston to Washington (Construction) $4,160,000
Widen 9th Street from Washington to New Orleans (Design) $420,000
Widen 23rd Street from Omaha to Albany (Construction) $4,000,000
Bridge replacement on 23rd Street between Omaha and
Albany (Construction) $3,280,000
Widen 37th Street from Dearborn to Omaha (ROW\Utilities) $560,000
Residential Street Improvements (Design\Construction) $2,050,000
Broken Arrow\County Street projects (Des\ROW\Utilities\Con) $2,000,000
Various Sidewalk Improvements (Des\ROW\Utilities\Con) $185,000
Downtown Infrastructure Improvements (Des\ROW\Util\Con) $1,500,000
Innovation District Improvements (Des\ROW\Utilities\Con) $2,035,000
Proposition 1 Subtotal: $33,650,000