There are two types of refundings, as defined by federal tax laws; a current refunding in which a refunding takes place within 90 days of the optional call date; and an advance refunding in which refunding bonds are sold more than 90 days prior to the first call date. Tax-exempt advance refundings were eliminated as part of the 2017 Tax Cut and Jobs Act. Previously, federal regulations permitted issuers to advance refund an issue of bonds only once during the life of the issue. Regulations do not restrict the number of times that debt can be refinanced on a current basis, and the city will consider reducing its minimum savings threshold for current refunding issues. The city will evaluate refunding proposals and financing structures that create savings or other financial benefits on a case by case basis. The city will consider refunding its debt obligations when it can be clearly demonstrated that such refunding will result in present value savings of 3% to 5% of the debt being refinanced. However, in certain circumstances, lower savings thresholds may be justified.
(Ord. 31-16, passed 9-12-16; Am. Ord. 37-19, passed 8-26-19)