09/11/2006 Council Packet - Laserfiche WebLink

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• • • City of Lino Lakes September 8, 2006 Page 3 refinancing is estimated to be $226,115. The Bond issue size is $3,040,000 and with the smaller issue size, the net present value savings as a percentage of refunded debt is now 6.72 %, more than double the minimum requirement for advance refundings discussed in the background section of this letter. On September 7, 2006, a review by both Springsted Incorporated and Kennedy & Graven was completed along with city staff. The partial refunding was determined to be the most beneficial. Since the public hearing is needed for this option, we advised staff to complete the public hearing process, as advertised, on Monday, September 11. Timing The bonds are not scheduled to be sold until October 23. Adoption of the resolution approving the five year CIP is needed by September 11 so that the 30 day reverse referendum expires before an Official Statement bond offering document is released. The City Council will be asked to authorize the sale date and the bond offering on September 25 when a Recommendation document and resolution authorizing proceeding with the sale will be presented. We apologize for any confusion about the necessity of the public hearing as we reworked the transaction to comply with the original intent of the building usage and the definitions in the statutes. Through our best efforts, both Springsted Incorporated and Kennedy & Graven are able to present a solution that provides savings exceeding the original estimates and a smaller transaction size which translates into a more efficient refunding. In addition, we have identified another refunding opportunity for the 1996B Water Revenue Bonds that would result in present value savings of about $45,000 over the life of the bonds. By offering these refundings at the same time, the savings and effort are improved through shared printing costs, staff preparation (one set of marketing documents instead of two) and rating fees. We've enclosed an update of interest rates for government bonds, showing the recent reduction in interest rates. We are also enclosing the summary pages for the partial refunding of the lease revenue bonds with GO CIP Bonds with current estimates. Please let us know if you have any questions or wish to discuss this further. We appreciate the opportunity to serve you. Respectfully, Terri Y. Heatari;Serior Vice President Client Representative Cc: Steve Bubul, Kennedy & Graven Dave Jaye, Springsted Incorporated Rob Scott, Springsted Incorporated —45i-