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Motion carried. Voting Yes: Acting Chairperson Strommen, Councilmember Zimmemaan and <br />Mayor Gamec. Voting No: None. Absent: Chairperson Elvig, <br /> <br />Case//3: <br /> <br />Accepting Proposal on the Sale of $1,485,000 General Obligation Capital <br />Improvement Crossover Refunding Bonds of 2004 <br /> <br />Finance Office Lund stated Paul Donna from Northland Securities is present to discuss the sale <br />o f $1,485,000 General Obligation Capital Improvement Crossover Refunding Bonds of 2004. <br /> <br />Paul Donna of Northland Securities presented the Committee with information regarding the <br />proposal on the sale of $1,485,000 General Obligation Capital hnprovement Crossover <br />Refunding Bonds of 2004. He explained in 1999 the Council authorized the issuance of lease <br />revenue bonds in the amount of $1,655,000 for the construction of a fire station via the EDA. <br />Within thc last couple of years there has been new legislation that allows municipalities to issue <br />Capital Improvement Bonds to finance municipal projects such as City Halls, Police and Fire <br />Stations. Capital hnprovement Bonds versus a Lease Revenue bond offer a lower rate of interest <br />of approximately .25 percent. The feasibility in savings initially looked at was approximately <br />$130,000 by refinancing these bonds. The bonds were priced yesterday and today, and the City <br />will bc able to maintain the same payment structure with the timeframe of the debt service <br />reduced by two years. The City will receive a net savings of $150,522. He explained these <br />bonds require the City to be non-bank qualified, which is at a threshold of ten million dollars. <br />When thc charter school issued the bonds there was an agreement that any financing that the City <br />did this year impacted by the bonds would be reimbursed by the school. He and Finance Officer <br />Lund are working with the school, and due to this the savings to the City will be closer to <br />$160,000. He explained along with the issuance of the bonds they did apply to the rating agency <br />for confirmation of the City's rating, and the City's A1 rating was confirmed. It was stated that <br />lt]c City has sound finances and the tax base is continuing to grow with a diverse tax base, and <br />the debt ratios are at a manageable level. Finance Officer Lund spent a significant amount of <br />time discussing the Town Center project and the impacts of that on the City. He stated the City <br />has been very progressive in issuing bonds to refinance, and it has been a great couple of years to <br />do that. <br /> <br />Mayor Gamec stated Mr. Donna and Finance Officer Lund have brought quite a savings to the <br />City over the years in bonding. <br /> <br />Motion by Mayor Gamec, seconded by Councih-nember Zimmerman, to recommend that the City <br />Council authorize the adoption of a resolution accepting proposal on the sale of $1,485,000 <br />General Obligation Capital Improvement Crossover Refunding Bonds, Series 2004. <br /> <br />Further discussion: Finance Officer Lund indicated with the adoption of the resolution the <br />closing on the bonds will be in early November. <br /> <br />Motion CmTied. Voting Yes: Acting Chairperson Strommen, Mayor Gamec and Councilmember <br />Zimmerman. Voting No: None. Absent: Chairperson Elvig. <br /> <br />Finance Committee/October 26, 2004 <br /> Page 3 of 5 <br /> <br /> <br />