Number
130069
Version
Substitute 2
Reference
121149
Sponsor
THE CHAIR
Title
Substitute resolution authorizing the sale and issuance of general obligation promissory notes in the aggregate amount of $65,000,000 to pay a current municipal pension contribution expense.
Analysis
Resolution authorizes the issuance and sale of contingent borrowing for general obligation notes for current municipal expenses, in the amount up to $65,000,000 for paying liabilities incurred to the Employes' Retirement System that is usually paid the following January.
Body
Whereas, The 2013 budget of the City of Milwaukee adopted by the Common Council contemplates the issuance of $200,000,000 of debt for contingent borrowing purposes; and
Whereas, The City desires to authorize not more than $65,000,000 of the contingent borrowing for general obligation promissory notes in the aggregate amount of not more than $65,000,000 to pay current municipal expenses due to the Employes' Retirement System; and
Whereas, The City typically pays in January for liabilities incurred in the prior calendar year, and desires to pay that liability on a current basis, rather than in arrears, for the next several years; and
Whereas, Council File 121417 establishes policies and practices which stabilize the City's annual expense to fund future pension costs, generating a consistent and predictable annual liability; and
Whereas, Prepayment of the calendar 2013 pension liability generates 2014 budget savings of $1.7 million, and net savings of up to $4.4 million for each year pre-paid until maturity of the note; now, therefore, be it
Resolved, By the Common Council of the City of Milwaukee that it hereby authorizes and declares its purpose to use contingent borrowing to sell and issue general obligation promissory notes in the aggregate amount of not more than $65,000,000 for the purpose of paying a current municipal pension contribution expense; and, be it
Further Resolved, That such amount may be issued as notes pursuant to resolution 121149 (Contingent Borrowing - Unallocated), including temporary borrowing as Extendable Municipal Commercial Paper; and, be it
Further Resolved, That the 2013 budget for the Provision for Employee Retirement Funds, Employer's Pension Contribution is increased by up to $63,000,000 to make the payment in 2013 with the borrowing authorized by this resolution as the funding source.
Requestor
Budget Office
Drafter
RSL
PD-8011W.rtf