07-24-2019 Council Packet - Laserfiche WebLink

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STAFF REPORT TO: Mayor Keis and Members of City Council FROM: Brenda Malinowski, Finance Director DATE: July 19 , 2019 RE: 2001A G.O. TIF Bond ACTION REQUESTED : Adopt the resolution to call for the redemption of the 2001A Bonds. BACKGROUND: Currently, s taff is working through the final close out of TIF 3 -2. This district was decertified on 9-27-2017, and the staff report from that meeting is attached. There are several housekeeping items to complete regarding TIF 3 -2. The items are as follows, in no particular order: • Close out documents with the developer, Sherman & Associates • Final payment to the developer, Sherman & Associates • Close out of 2001A Bond (these are the bonds that the City owns). These bonds were issued in 2001 for $3,000,000 at an interest rate of 7.1%. • Determination of any additional excess increment • Determination of amount available for the sidewalk When I consulted with the City’s Municipal Advisor and Bond Attorney regarding the amount available for the sidewalk, the attorney became aware of the outstanding bonds for the first time . Since there are adequate funds available in TIF 3-2 to retire these bonds, the attorney is recommending that the City call these bonds based on the State Statutes requirements regarding outstanding obligations in a TIF district. The b onds should have been called in 2018, when there was sufficient money to pay the outstanding bonds. These requirements are in place in order to insure that tax revenues are directed back to all the taxing jurisdictions (County, School District, and City) as soon as obligations have bee n satisfied. Since there were sufficient revenues in 2018, the 2018 bond interest payment will need to be paid back to TIF 3 -2 in the amount of $86,385. I am recommending that these funds come from the General Capital Improvements Fund (400). ACTION REQUESTED : Adopt the resolution to call for the redemption of the 2001A Bonds.