Prior Lake approves $4.67 million bond sale for infrastructure
The Prior Lake City Council unanimously approved the issuance of $4.67 million in general obligation bonds on August 13 to finance street and utility improvements. The city secured a favorable 3.24% interest rate, reflecting its rare AAA credit rating from S&P Global.
The council voted unanimously to move forward with the General Obligation Bonds Series 2026A, with Council Member Brad moving the resolution and Council Member Lake seconding it. Municipal Adviser Tammy Amdall highlighted the significance of Prior Lake's financial standing, noting that as of June, only 29 Minnesota cities hold an AAA rating—less than 10% of all cities rated by S&P Global in the state.
Amdall explained that the city achieved its favorable interest rate through a competitive bidding process that drew eight bids. Raymond James, based in Dallas, Texas, submitted the winning bid. While the nominal coupon rates were higher, the premium bid structure reduced the principal amount, resulting in the actual true interest cost of 3.24% rather than 5%.
Amdall emphasized that maintaining the AAA rating requires sustained financial discipline. She noted the importance of long-term financial planning, maintaining reserves above minimum levels, and being prepared to levy taxes if necessary to preserve the city's reserve policy during years without budget surpluses.
The council also unanimously approved a consent agenda containing routine items, including financial reports, project amendments for the Lord's Bridge rehabilitation and Verling Ridge wetland replacement, temporary liquor licenses for the Prior Lake VFW and Prior Lake Chamber of Commerce, and final payment approval for the Fire Station One bathroom remodel. No council members requested separate discussion of any consent agenda items.
Additionally, the council adopted the 2026 Scott County All Hazards Multi-Jurisdictional Mitigation Plan in partnership with other regional jurisdictions. City staff were recognized for their swift response to a recent cyber incident that could have disrupted water and wastewater services. The city manager also announced upcoming community events, including Night to Unite and Prior Lake Day at the St. Paul Saints venue.
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Votes (2)
Consent Agenda
Moved by Council Member Brad [00:06:51] · Seconded by Council Member Helier [00:06:52]
City Manager Wedell presented the consent agenda, which grouped together several routine and non-controversial items for efficient approval. These items ranged from financial reports and project amendments to temporary licenses and personnel appointments. There was no discussion or requests from council members to remove any item for separate consideration.
Resolution Approving the Issuance and Sale of General Obligation Bonds Series 2026A
Moved by Council Member Brad [00:16:35] · Seconded by Council Member Lake [00:16:38]
Finance Director Kleener and Municipal Adviser Tammy Amdall presented the resolution for the issuance and sale of general obligation bonds to finance street and utility improvements. Amdall detailed the city's affirmed AAA bond rating from S&P Global, emphasizing its rarity in Minnesota and the importance of strong financial management. She explained the competitive bidding process, resulting in eight bids, and the low bid from Raymond James, achieving a true interest cost of 3.24% for the $4.67 million bonds despite higher coupons due to a premium bid, which reduced the principal amount.
Notable Quotes (3)
As of June there are only 29 cities in Minnesota that hold that rating. It's less than 10% of the um cities that S&P rates in Minnesota. So congratulations to the city.
I would note the maintenance of it is important. that long-term finance planning, maintaining those reserves, not at your bare minimum, but at levels above that, and ensuring that in years that you don't have those surpluses, and I listened um to staff talk about that, the importance that if you were to have to actually levy taxes in order to maintain that reserve that is pursuant to your policy.
Your interest rate is not 5%. Your interest rate is 3.24%. Determined by tremendous cost taking into factor what the underwriter worked for.
Ordinances & Resolutions (17)
Routine approval of city expenditures.
Accepting donations and grants to the city during the second quarter of 2026.
Financial report presented for approval.
Financial report presented for approval.
Amendment related to a city infrastructure project.
Summary of building permits issued.
Approval of a specific environmental restoration plan.
Approval of a contract for utility infrastructure maintenance.
Approval of a temporary license for a local organization.
Appointment of personnel for upcoming elections.
Approval of final payment for a city facility renovation.
Adoption of a regional disaster preparedness plan.
Approval of a temporary license for a local organization.
Bonds issued to finance street and utility improvements.
Highest credit rating affirmed by S&P Global for the city's bonds.
Strategic document guiding the city's financial management.
A plan to address multiple hazards across jurisdictions.
Source document
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Other Topics from This Document
General Obligation Bonds Issuance and Sale
City Updates, Strategic Partnerships, and Operational Resilience
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