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Vandalia aldermen pick PiperJaffray to refinance

Posted on Wednesday, November 30, 2016 at 10:44 am

Curt Gilliam, Assistant Vice-President of Piper Jaffray, talks to the board.

Curt Gilliam, Assistant Vice-President of Piper Jaffray, talks to the board.

After seeking out their own bids for the refinancing of the Vandalia Area Aquatic Center, the City of Vandalia’s Board of Alderman decided PiperJaffray was the right placement agency for the job. This unanimous decision came during a special meeting held on Monday, November 21 with only Alderman Gabe Jennings absent from the meeting.
PiperJaffray’s services cost in the range of $20,350-$35,000 depending on costs of legal counsel and title work. The same group also said they would match any lower bids for selection of the lending institution and related paperwork.
Other bids received were from L.J. Hart & Company (around $38,550), Columbia Capital ($19,000-$26,000 and city would have to hire their own counsel), and Wells Fargo issued a formal “no bid.” Just four of the eight vendors contacted responded to the bid request.
The decision to use PiperJaffray’s services and already secured a bid from the Central Bank of Audrain County that would drop the interest rate from 4.72% to 2.14%. This move represents a net savings in excess of $95,000 during the next 10 years. It also moves the financing of the pool from a New York City based bank to a Vandalia bank.
The city still owes more than $790,000 on the project.
Curt Gilliam, Assistant Vice-President of Piper Jaffray, attended the city’s regular November board meeting earlier in the month.
He previously noted that every week Vandalia aldermen would delay a decision could cost the city about $460 each week due to the interest percentage difference.
Health Insurance discussion
A decision on deciding a health insurance carrier was delayed a month so aldermen can review it again at the December meeting.
Bids were solicited from seven vendors with five received totaling 19 different plan options.
City Administrator Chase Waggoner noted the recommendation to enter in negotiations with Benefit Specialists LLC of Columbia to purchase Employee Group Health Insurance. This is a partially self-funded PPO Co-pay plan through National General Insurance.
The plan could save the city as much as $45,931.20 per year.
According to drafted meeting minutes, Alderman John Weiser noted that employees are the city’s greatest asset and he said employees seem to like the present insurance company.
He also noted that he was not comfortable with the idea of “saving money” on the costs for the city.
He then moved for the group to stay with the Federal Insurance Company and for the city to make up the difference in costs for the month.
Currently, this same company has announced a possible increase of 14.9% or $33,316.08, raising premiums to $256,754.52 annually.
The 2016 health insurance plan was at $223,438.44.
The other health insurance bids received also showed increases in costs in 2017.
One bid was at $177,507.24 but could be subject to underwriting and may increase.

Miscellaneous
During New Business and Future Agenda Items, the discussion included looking at a proposed increase to the water surcharge rate on a future agenda, the approval of a USDA grant for the Vandalia Police Department involving a patrol vehicle, and there was also a review of wage scales and vacant positions.
A partial Accounts Payable was approved.
City Administrator Waggoner noted that bids received for the demolition of the Library building have come in much higher than expected.