WATERTOWN, S.D.(KXLG)- The Codington County Commissioners approved a financial agreement with Colliers Securities LLC, another step in the new detention center project process. The agreement aims to guide the county through the financial aspects of upcoming construction projects, including debt issuance and strategic investment management.
Toby Morris, Senior Vice President of Colliers, presents a detailed plan emphasizing the importance of timing and regulatory compliance in managing bond proceeds.
Morris said he would act as a “finance manager” throughout the project. He recommended using available cash for the initial six months to comply with IRS spend-down rules and avoid premature debt issuance that could result in non-compliance. He explained the benefits of issuing a reimbursement resolution, allowing the county to maximize investment returns and adhere to IRS guidelines.
Morris provided an overview of the financial landscape, noting the current average interest rate of approximately 3.48% for 20-year bonds and potential gains through strategic investment.
He highlighted the process of coordinating with the construction manager and County Auditor Hanten to align expenditure timing with bond issuance, ensure compliance with IRS rules, and optimize additional revenue financial outcomes.
Commissioner Gabel inquired about the timing and allocation of funds, asking whether the current plans would ensure adequate resources until the bonds are issued. Morris assured the commissioners that the county could effectively manage its financial resources with careful coordination.
The discussion also highlighted the potential financial gains through efficient bond proceeds investment. Morris cited examples from other counties, such as Lawrence County and Harrisburg School, that successfully maximized returns by following similar strategies.
Morris emphasized the value of having an advisor to guide the county through the investment process while coordinating with an underwriter for broader market access.
Morris reassured that continuous monitoring and strategic decisions would help manage costs effectively, ultimately benefiting taxpayers by lowering overall project expenses.
The motion passed unanimously.