Agenda - Council - 02/10/2009 - Laserfiche WebLink

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CC#l REFINANCING OF ANOKA COUNTY HRA BONDS RELATING TO THE SAVANNAH OAKS SENIOR HOUSING PROJECT By: Diana .Lund, Finance Officer Background: The refinancing of the Anoka CountyHRA Bonds related to the Savannah Oaks project was submitted to the City Council beginning in 2007. The City Council adopted the refinancing in 2008, but the bond sale never transpired. The Anoka County HRA was waiting to hold a joint bond sale with the refinancing of the Ham Lake Senior Housing project. During the period that Ham Lake took to deny the refinancing, the bond market became less favorable for a refinancing. As market conditions have again turned highly favorable, the County is now looking to refinance the debt related to the senior housing project. . As a significant time period has passed, along with a change in City council, a new resolution needs to be adopted authorizing the refinancing and an amendment to the Joint Powers Agreement which includes a clause related to the operating deficit agreement. . The following information relates to the history of the original bond purchases and the City . Council actions authorizing the refinancing and the amendment to the Joint Powers Agreement with the Anoka County HRA. In 1998 the City entered into a Joint Powers Agreement with the Anoka County Housing and Redevelopment Authority (HRA) to fund the construction of the City's Senior Housing project currently known as Savannah Oaks. There was a total of $4) 95,000 in debt issued to fund the project. The County HRA issued a $3,000,000 Revenue bond that was backed by the City's General Obligation Pledge (City's taxing/levying power) and the City issued a $1,195,000 Tax Inclement Financing Bond currently being paid with rental revenue and an annual County HRA levy and backed by Tax Increment District #4. Both of these issues are paid with rental revenue and the HRA County levy. The City had a separate bond issue as a County HRA can only issue a maximum of three million. The Joint Powers Agreement between the Anoka County HRA and the City stated that first priority would be given to Ramsey residents if they chose to live in the Savannah Oaks building. Anoka County HRA contacted the City in December 2007 about refinancing the HRA bonds due to attractive interest rates. They were proposing to remove the City's general obligation pledge in exchange that the Ramsey resident priority be removed when there is a vacancy available. Thus, an opening would be open to all Anoka County residents. On January 8, 2008, Karen Skepper from the Anoka County HRA and Kathy Cardell from Ehlers and Associates were present at the City Council meeting to discuss the refinancing and the resident priority list. All members ofthe council, with the exception of Mary Jo Olson who was absent, voted yes to -193-