02/24/04 - Laserfiche WebLink

Home

Motion carried. Voting Yes: Chairperson Elvig, Councilmembers Zimmerman and Strommen. Voting No: None. Case #3: Consider Financing for Ramsey Town Center Regional Improvements City Administrator Norman reported one of the issues remaining for the completion of the Development Agreement with Ramsey Town Center, LLC was the responsible parties to pay for the regional improvements surrounding the Town Center project. Staff has been in discussions with Anoka County since the summer of 2002 and recently received the first proposed draft of a Joint Powers Agreement (JPA) with Anoka County. The county has indicated it is their past practice that they finance no greater than 30 percent of a project. It is staff's feeling this project has a great benefit to the county. The full build-out tax generated for the City will be close to 3.4 million dollars and the county will receive 3.3 million dollars per year in new tax revenue. Due to this, staff believes the county's participation should be greater than 30 percent. During discussions with the county they tried to be as creative as possible. Staff has met with Oppenheimer & Company, Inc. who works with the county. They have discussed a new concept called Variable Rate Demand Bonding. Ralph McGinley of Oppenheimer & Company will be explaining the concept of the Variable Rate Demand Bonding to the Finance Committee. Chairperson Elvig questioned if the improvements being discussed would be on Ramsey Boulevard, Highway 116 and Armstrong Boulevard as it surrounds the Town Center. He clarified the financing would not include the infrastructure and streetlights, but would primarily include the street and the accesses. Finance Officer Lund indicated the financing includes the street, the storm, and the signalization on the county roads. Assistant Public Works Director Olson explained the Joint Powers Agreement was included tonight for the committee's information. The idea tonight is to go over the variable interest rate and staff will work with the county to fill in the numbers in the agreement. Councilmember Zimmerman commented he believes there was county participation in the Lino Lakes project on Main Street. Assistant Public Works Director Olson explained the Joint Powers Agreement is a draft. It shows zero participation, however, the county has not indicated they will not participate. The agreement was included to show the text. Ralph McGinley, Senior Vice President of Fixed Income Originations of Oppenheimer & Company, Inc., explained Variable Rate Demand Bonding is a financing technique that would take a fixed rate payment from the county and turn it from 30 percent to closer to 50 percent. It is not an increase in county dollars, but is an increase in the City's cost. Mr. McGinley explained the concept of Variable Rate Demand Bonding and the role of the City and county with this bonding. It was noted there will be a protection mechanism with a cap on the interest rate that would be monitored by Oppenheimer & Company. Finance Committee/February 24, 2004 Page 3 of 5