08/07/2006 Council Packet - Laserfiche WebLink

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• • • WS -2 WORK SESSION MEMORANDUM To: City Council From: Al Rolek Date: August 7, 2006 Re: Work Session Item 2 — Refunding of EDA Lease Revenue Bonds 1998A (Civic Center Complex) cc: Attached is a letter from Terri Heaton of Springsted, Inc., relating to the refinancing of the EDA Lease Revenue Bonds 1998A. These bonds were originally issued to finance the construction of the Civic Center Complex. We have been monitoring this issue for refinancing opportunities in recent years. As Terri explains in her letter, a recent change in statutes allows us the opportunity to refinance the issue with a general obligation issue of the city. Since the new issue will be backed by the full faith and credit of the city, we will save an estimated $208,000 over the term of the issue, over twice the savings of refinancing with another lease revenue bond (see asterisks on feasibilities). However, in order to refinance the issue in this manner, we must include the refinancing in our capital improvement plan (CIP) for 2006 and hold a public hearing. A 30 -day reverse referendum period follows the public hearing, effectively pushing the sale date out until after this period has elapsed. You may recall that the savings resulting from this refinancing was already factored into the reduction of the amount of tax abatement bonds (reducing the capitalized interest included in that issue) for the YMCA project. Staff recommends that the City Council schedule and hold the required public hearing and amend its CIP to include the refinancing of this issue. The refunding feasibility and a schedule for this process is attached for your review. Any further questions or comments can be addressed at the meeting on Monday night.