Agenda - Council - 06/27/2017 - Laserfiche WebLink

Home

Executive Summary of Proposed Debt Proposed Issue: Purposes: $895,000 General Obligation Road Reconstruction Bonds, Series 2017A The proposed issue includes financing for the City's following 2017 road reconstruction projects: • Alpine Street. Debt service will be paid from ad valorem property taxes. • Sunwood Drive. Debt service will be paid from special assessments. It is the intent of the City to levy special assessments in the amount of approximately $105,000 to benefiting property owners. These assessments will be levied in 2017 for collection in years 2018 through 2027 at a rate of 2% over the True Interest Cost of the proposed Bonds. Annual assessments are paid on an equal principal basis. The City anticipates receiving $21,000 in prepayments (approximately 20%) so the Bond size has been reduced accordingly. Authority: The Bonds are being issued pursuant to Minnesota Statutes, Chapter: • 475.58 3b Term/Call Feature: Bank Qualification: The Bonds will be general obligations of the City for which its full faith, credit and taxing powers are pledged. The Bonds count against the City's General Obligation Debt Capacity Limit of 3% of estimated market value (EMV). In the City the pay 2017 EMV is $2,236,219,500. Therefore, the total amount of outstanding debt cannot exceed $67,086,585. As of June 21, 2017 the City has $22,825,000 subject to the legal debt limit. The City held the required public hearing on it 5-year street reconstruction plan on March 10, 2015. The Bonds are being issued for an 11-year term. Principal on the Bonds will be due on January 15 in the years 2018 through 2027. Interest is payable every six months beginning June 15, 2018. The Bonds maturing on and after January 15, 2027 will be subject to prepayment at the discretion of the City on January 15, 2026 or any date thereafter. Because the City is expecting to issue no more than $10,000,000 in tax exempt debt during the calendar year, the City will be able to designate the Bonds as "bank qualified" obligations. Bank qualified status broadens the market for the Bonds, which can result in lower interest rates. Presale Report City of Ramsey, Minnesota June 27, 2017 Page 1