02-14-2007 Council Agenda - Laserfiche WebLink

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CITY OF LITTLE CANADA, MINNESOTA PRE-SALE REPORT: G.O. (PIR) FUND BONDS FEBRUARY 14, 2007 Proposed Issue: General Obligation Permanent Improvement Revolving Fund Bonds, Series 2007 Purpose: Description: To finance either Option 1 or Option 2. Option 1 is the 2007 Street Reconstruction and Utility Improvements in the amount of $3,261,000. Option 2 is the Option 1 Improvements plus the Rice Street and County Road B Improvements in the amount of $3,811,000. The Bonds are being issued pursuant to Minnesota Statutes, Chapters 429 and 475, for the purpose of financing the construction of the Improvements. Financing the Option 1 Improvements requires a bond issue in the amount of $2,205,000. Financing the Option 2 Improvements requires a bond issue in the amount of$2,770,000. The proposed finance plan consists of the sources and uses of funds attached to this Report. Term /Call Feature: Principal on the Bonds will be due on February 1 in the years 2008 through 2018. Bonds maturing February 1, 2013, and thereafter will be subject to prepayment at the discretion of the City on February 1, 2012. Rating: The Bonds are expected to be rated by Moody's at an "A2" level. Funding Sources: The Bonds are general obligations of the City and as such are secured by a pledge of the City's full faith, credit, and taxing powers. It is the intent of the City to levy special assessments in the amount of $617,330 against benefitting property owners in the years 2007 through 2016, for collection in the years 2008 through 2017, at a rate of 6.50% or 2% per annum over the average rate of the Bonds. The remaining balance will be paid from a tax levy. If significant prepayments of assessments are received before the call date, the tax levy may need to be increased. However, the City has the authority to reduce or cancel the tax levy on an annual basis with any other available money duly appropriated by the City Council for such purpose. It is the intent of the City to replace the tax levy with state aid and other available funds of the City. We have anticipated $125,000 in prepaid special assessments at this time. Prepared by Ehlers & Associates, Inc.