Laserfiche WebLink
MINUTES <br />City Council <br />May 13, 1986 <br />The Auditor reported that under special taxing district financing <br />there would be less legal and engineering costs because the assessment <br />roll process is eliminated. Also, there would be a decrease in <br />accounting and audit costs as well as a decrease in debt management <br />costs. The Auditor further reported that this financing weights <br />the costs towards industrial/commercial property rather than residential <br />property. <br />Brad Farnham, the City's bond consultant, presented a graph showing <br />where the bond market and interest rates are in 1986 versus 1985. <br />Farnham reported that the interest rates are at a 13 year low for <br />local governments and this is an excellent time for the City to <br />borrow money. <br />Fahey pointed out that if the City approves specific projects, it <br />would issue a bond for a combination of 3 or 4 or 5 projects in <br />order to take advantage of the bond market. <br />Farnham pointed out that the $2.4 million includes all four priorities <br />of projects. <br />The audience asked if the interest rate the City would get would be <br />a flat rate or variable. <br />Farnham replied that the City would award the bond at a fixed net <br />effective interest rate. Farnham anticipated that the rate the <br />City might get would be in the low 7% range. <br />Mr. DeLonais asked why industrial and commercial properties wo~ld <br />pay more. <br />Farnham explained that the cost of the projects would be spread <br />over the assessed values in the City and increased values are <br />attributed to commercial and industrial propertyes. Voto reported <br />that the City would be using the market value as listed in the County <br />Assessor's office. <br />Fahey pointed out that past policy of the City has been not to assess <br />storm sewer projects. The City has in the past spread these costs <br />on general taxes based on market values. Fahey pointed out that if <br />the City were to assess these costs, the assessment might be prohibitive <br />in some cases. Fahey also pointed out the Engineer's report that 95% <br />of the City drains into Lake Gervais. <br />A member of the audience asked what cost an owner of a$250,000 home <br />might expect. <br />Farnham replied that it would be at least double that of a$125,000 <br />home as was earlier illustrated. <br />P1r. Van Norman challenged the statement in the City's letter to <br />property owners that the value of his property would increase. <br />Page -7- <br />