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• <br />expected to by deferred because the land falls into one of the following categories: 1) <br />green acres; 2) senior citizen; or 3) unplatted /undeveloped land. <br />This severely limits the revenue stream necessary to fund any debt issued for the <br />project. As a result staff has worked with Anoka County to develop a payment schedule <br />to accommodate the city's situation. <br />Upon issuance of the county bonds the city will issue to the county a general obligation <br />improvement note. Under the proposed payment schedule the city will make interest <br />only payments over the first five years. Principal and interest payments will be made <br />over the following 10 years. A service charge representing approximately 75 basis <br />points will be applied to the bond rate to cover the county's financing costs. The service <br />charge is weighted toward the end of the payment period. The agreement allows for the <br />city to reduce the service charge by prepaying the debt anytime. The city also agrees to <br />apply prepayments of any deferred assessments directly to paying down the obligation. <br />The above referenced terms are more fully described in Section III.F.5 of the attached <br />Joint Powers Agreement. <br />As previously noted the majority of assessments will be deferred. However, <br />approximately 20% will be available, following certification, for debt service purposes. <br />The city's municipal state aid street funds will be used as an interim funding source to <br />cover the remaining balance until such time as the deferred assessments are received. <br />Based on the analysis by Springsted Inc., additional revenues will be required in years <br />2020 through 2024 to fund debt service obligations. The amount is estimated at a total <br />of $810,000 over the four years. These revenues may come in the form of deferred <br />assessments being paid. Additionally, the city also has alternatives available through <br />the JPA to help reduce this potential short fall. <br />Representatives from Sprinsted Inc. will be present at the meeting to review the <br />financing plan and address council questions. <br />RECOMMENDATION <br />Staff is recommending approval of the JPA with Anoka County. <br />ATTACHMENTS <br />1. Resolution No. 09 -73 <br />2. Joint Powers Agreement <br />