Agenda - Council - 07/26/2011 - Laserfiche WebLink

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CC Regular Session 7. 2. Meeting Date: 07/26/2011 By: Diana Lund, Finance Title: Authorization of the Issuance of General Obligation Bonds, Series 2011A for the Construction Upgrade of Bunker Lake Boulevard /Armstrong Boulevard Background: At its regular meeting of May 31, 2011, city council authorized a contract with Douglas -Kerr Underground, LLC for City project #11 -21. This project is for the Armstrong and Bunker Lake Boulevard Intersection Signalization which was a requirement of the COR Regional Roadway Improvements JPA Agreement with Anoka County and for the Legacy Christian Academy development approvements. The costs attributed to the city for the intersection signalization was estimated at $2.776M and Legacy Christian Academy Improvements were estimated at $1.701M. Funding for the two projects were to come from the issuance of debt, with the issuance of an MSA revenue bond for the city share, and a Special Assessment bond for the Legacy share. As the project has already been awarded, the city will incur costs prior to bond funds being received. A reimbursement resolution was adopted by city council on June 14, 2011 which allows the city to pay itself back with bond proceeds. The MSA bond will be backed by the City's MSA (state aid) funds and the annual debt service payment will be paid from the city's annual state aid allocation. The MSA bond will be for a period of 10 years. The Special Assessment bond will be levied against the property of the Legacy Christian Academy for a period of 20 years. A portion of the assessment will be deferred for three years per the terms of their special assessment agreement. The actual bond pricing is proposed to be held on August 4, 2011 and brought back to city council for consideration of the rates on August 9, 2011. Northland Securities, the City's Financial Advisor, will be present at the meeting. A copy of the proposed finance plan for the bond sale is attached. The average interest rate proposed for the MSA Bond is 2.14% and 3.33% for the Special Assessment Bond. Funding Source: These bonds will be backed by the City's Muncipal State Aid funding with the debt service paid from the annual allocation and the Special Assessment Bond will be backed by an annual levy to the property of the Legacy Christian Academy. Council Action: Motion to recommend that Council adopt Resolution # 11- 07 -XXX Authorizing the Issuance of General Obligation Bonds, Series, 2011A. Finance Plan Resolution Approving Issuance Attachments Form Review Inbox Reviewed By Date Kurt Ulrich Kurt Ulrich 07/20/2011 10:45 AM