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<br />NOTE 5 - LONG-TERM DEBT (CONTINUED)
<br />
<br />B. Descriptions of Long-Term Debt
<br />
<br />. Tax Increment Bonds - These bonds are issued for redevelopment and economic development
<br />projects. The additional tax revenue resulting from increased assessed valuation of the properties
<br />is the major source of revenue used to retire the related debt. The Tax Increment Bonds, Series
<br />1999A will be funded by operating rental income from the Senior Housing Project if sufficient,
<br />with tax increments being pledged as the second source of funding.
<br />
<br />On March 1, 2007, the City issued the $945,000 General Obligation Tax Increment Refunding
<br />Bonds, Series 2007B to advance refund the City's $920,000 General Obligation Tax Increment
<br />Bonds, Series 200lE. The net proceeds were used to retire all outstanding principal of the tax
<br />increment bonds on March 26, 2007 (the call date). The refunding resulted in a $25,427 decrease
<br />in the City's total debt service payments over the next seven years, and an economic gain
<br />(difference between the present value of the debt service payments on the old and new debt) of
<br />$20,899. This refunding was undertaken to take advantage of interest savings due to favorable
<br />market conditions.
<br />
<br />. Capital Improvement Refunding Bonds Series 2004A - These bonds were issued to finance
<br />Fire Station #1 and will be repaid via ad valorem levies.
<br />
<br />. General Obligation Improvement Bonds Series 2005B - On June 1, 2005, the City issued
<br />general obligation improvement bonds totaling $4,335,000. These bonds were issued on the basis
<br />of a joint powers agreement between Anoka County and the City for regional road improvements.
<br />Anoka County makes the annual debt service payment to the City.
<br />
<br />. Lease Revenue Bonds Public Facility Lease Revenue Bonds Series 2005A (EDA) - During
<br />June, 2005 the Economic Development Authority (EDA) issued Lease Revenue Bonds totaling
<br />$19,200,000. A ground lease was entered into between the EDA and the City. These bonds were
<br />issued to finance the municipal center which includes City Hall offices as well as a Police facility.
<br />
<br />. Capital Equipment Certificates - These certificates were issued to [mance various capital
<br />equipment purchases and will be repaid via ad valorem levies.
<br />
<br />. Compensated Absences - The liability represents vested benefits earned by Governmental Fund
<br />employees through the end of the year which will be paid or used in future periods. The General
<br />Fund is the primary fund used to liquidate this liability.
<br />
<br />C. Changes in Long-Term Debt
<br /> Balance -
<br /> Beginning New Debt Balance - Due Within
<br /> of Year Issue s Debt Retired End of Year One Year
<br />Tax Increment Bonds $ 6,170,000 $ 945,000 $ 2,000,000 $ 5,115,000 $ 1,170,000
<br />Lease Revenue Bonds 19,200,000 19,200,000
<br />Capital Improvement
<br />Refunding Bonds 1,285,000 100,000 1,185,000 105,000
<br />G.O. Improvement Bonds 4,335,000 160,000 4,175,000 165,000
<br />Capital Equipment Certificates 1,262,000 790,000 362,000 1,690,000 570,000
<br />Compensated absences 527,567 499,578 429,050 598,094 388,761
<br /> $ 32,779,567 $ 2,234,578 $ 3,051,050 $ 31,963,094 $ 2,398,761
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