10/23/2006 Council Packet - Laserfiche WebLink

Home Search

Under Minnesota Statutes, Section 475.53, the maximum calendar year debt service on all outstanding capital improvement plan bonds, including these Series 2006E Bonds, cannot exceed an amount equal to 0.16% of the taxable market value of the property within the City. The City has no other capital improvement plan bonds outstanding and this issue is within the statutory limit. The Series 2006E Bonds constitute a "current" refunding since the Series 1998A Refunded Maturities will be called within 90 days of settlement of the Series 2006E Bonds. The Series 1998A Refunded Maturities will be called and prepaid on the call date of December 1, 2006 at a price of par plus accrued interest. The Series 1998A Refunded Maturities and the Series 1996B Refunded Maturities (as defined below) are collectively referred to as the "Refunded Maturities." Security and Financing The Series 2006E Bonds are general obligations of the City for which the City pledges its full faith and credit and power to levy direct general ad valorem taxes. The City is expected to make its first levy for the Series 2006E Bonds in 2006 for first collection in 2007. Available City funds will be used to make the February 1, 2007 interest payment. Thereafter, each year's levy will be in an amount sufficient to pay 105% of the interest coming due August 1 in the year of collection, and the principal and interest coming due February 1 of the following year. THE SERIES 2006F BONDS Authority and Purpose The Series 2006F Bonds are being issued pursuant to Minnesota Statutes, Chapters 444 and 475. Proceeds of the Series 2006F Bonds will be used to refund in advance of maturity the February 1, 2007 through February 1, 2012 maturities (the "Series 1996B Refunded Maturities ") of the City's $3,320,000 General Obligation Water Revenue Bonds, Series 1996B, dated October 1, 1996 (the "Series 1996B Bonds "). The refunding is being conducted to achieve interest cost savings. The Series 2006F Bonds constitute a "current" refunding since the Series 1996B Refunded Maturities will be called within 90 days of settlement of the Series 2006F Bonds. The Series 1996B Refunded Maturities will be called and prepaid on the call date of February 1, 2007 at a price of par plus accrued interest. Security and Financing The Series 2006F Bonds will be general obligations of the City for which the City will pledge its full faith and credit and power to levy direct general ad valorem taxes. In addition, the City will pledge net revenues of its water utility. Pursuant to Minnesota Statutes, Chapter 444, and the resolution awarding the sale of the Series 2006F Bonds, the City will covenant to maintain rates in an amount sufficient to support the operation of the water utility and to pay debt service on the Series 2006F Bonds. The City is required to annually review its budget of the funds to determine whether current rates and charges are sufficient and to adjust such rates and charges as necessary. 5