The Bell Community Redevelopment Agency has unanimously approved the sale of $6 million in short-term tax allocation notes to underwriter Smith Barney, the second largest investment banking firm in the nation, to finance public improvement projects.
The bonds were issued to finance a variety of public improvements, like upgrading the municipal water system, streets and sewers, which will support the Bell Redevelopment Project Area, according to Byron Woosley, chief administrative officer for the city.
Woosley said the agency plans to pay back the underwriter through tax increments based on the increase in the value of the property where the redevelopment project will be built. An "underwriters discount" based on the interest rate totaled $144,600.
Three firms bid on the five-year bonds, with Smith Barney offering the lowest interest rate of 6.9%. Bateman Eichler offered a 7% interest rate, and Merrill Lynch bid an interest rate of 7.25%.