PowerPoint Presentation (Added 4/18/2025)*

Council Workshop
Excise Tax Refunding & Cash Defeasance
April 22, 2025

Senior Lien Excise Tax Obligations Series 2025
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• The City is refunding the outstanding Excise Tax Series 2015A 
Obligations
o Currently estimated to save $1.6 million through this refinancing
• In conjunction with RBC Capital Markets, staff identified an 
additional opportunity to lower its debt service payments on its 
outstanding Excise Tax debt portfolio via defeasance of existing 
higher interest rate debt obligations that are replaced with a new 
money issuance at lower rates
• The City previously successfully used this financing concept in 
2023 to generate over $2.5 million of debt service savings

Cash Optimization Refunding Opportunity
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• The proposed financing plan entails:
o Optimizing use of a portion of the City’s unrestricted cash on hand 
budgeted for pay-as-you-go capital projects, by applying the cash to 
defease, or pay off, certain higher interest rate Excise Tax 
Obligations of the City
o Immediately replace the cash used by issuing new debt for the
planned capital projects at a lower interest rate
o By replacing higher interest debt with lower interest debt, the 
proposed financing plan generates debt service savings for the City
o Combining the proposed financing with the refunding of the City’s 
Series 2015A Excise Tax Obligations further enhances the savings 
due to economies of scale

Cash Optimization Refunding Opportunity 
Overview
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• To accomplish the proposed financing plan requires adoption of 
an Ordinance by the Council that:
o Authorizes using up to $32 million of cash budgeted for capital 
projects in the current and next fiscal year to pay off and defease 
existing Excise Tax Obligations
o Authorizes the issuance of new money Excise Tax Obligations in an 
amount sufficient to replace the cash used for defeasance and pay 
costs of issuance

Cash Optimization Refunding 
Opportunity Overview- Continued
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•
The following Excise Tax Obligations are viable for this plan:
o $29.035 million of outstanding Series 2008B bonds that mature from July 
1, 2026 through July 1, 2033 and are callable on any date; 
o $13.700 million of outstanding Series 2015B bonds that mature from July 
1, 2031 through July 1, 2033 and are callable on any date.
•
Only the most economically viable maturities would be cash defeased
depending on market conditions.  Current expectation is that roughly 
$30 million of cash would be used for the defeasance. 
•
The proposed Ordinance will permit (i) the cash defeasance and (ii) the 
issuance of new bonds for capital projects to replace the cash used on the 
defeasance
•
In this way, the City will replace higher interest rate debt with new 
lower interest rate debt

Estimated Savings to be Achieved
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• Series 2008B and Series 2015B bonds were issued as taxable 
obligations and carry average interest rates of 6.157% and 3.97%, 
respectively; Series 2015A are tax-exempt and carry a rate of 5.00%
o Will be replaced by new obligations at an estimated true interest cost of 
3.42%, based on recent market conditions
• At these estimated levels, the City would save approximately $3.69 million 
over the life of the issues being refinanced
o Equates to approximately $3.10 million on a present value basis or 5.97% 
of the principal amount of Obligations being refinanced
o Savings are all net of costs of undertaking the financing plan
• The actual savings achieved will be a function of the interest rates 
achieved on the new Series 2025 bonds
• The transaction would only go forward if an acceptable level of savings can be
achieved

Planned Series 2025 Issuance
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• The Series 2025 Obligations will be issued as Senior Lien Excise Tax 
Obligations to replace the Senior Lien Excise Tax issues being paid 
off
o The Series 2025 Obligations issued will have the same maturity length as 
the Obligations being paid off
o The expectation is that the Series 2025 Obligations will carry ratings of 
“AA+” by Standard & Poor’s and “AA” by Fitch Ratings, consistent with 
existing rating levels
o These are very high ratings (at the 2nd and 3rd highest rating levels 
possible) reflecting the strong credit profile of the City of Glendale
• The Obligations are expected to be sold to investors in the public tax- 
exempt market by RBC Capital Markets in the May/June timeframe, 
depending on market conditions, with financial closing occurring 
approximately two weeks after selling the Obligations to investors

Next Steps
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• Council review and approval of the Ordinance to permit the 
cash defeasance and the issuance of the new Series 2025 
Obligations is scheduled for the Council’s meeting on April 
22nd.  If there is consensus to proceed with the 
transaction, City staff, RBC and Bond Counsel will 
move forward with obtaining bond ratings and 
preparing all of the necessary documentation to 
accomplish the sale of the Series 2025 Obligations in 
the May/June timeframe, assuming acceptable bond 
market conditions.