09/08/2008 Council Minutes - Laserfiche WebLink

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CITY COUNCIL WORK SESSION -3- September 2, 2008 APPROVED 3 make sure the blanks are filled with facts. The council suggested that they will also consider a 4 good balance between the financial responsibilities of paying for this communication effort with 95 the need to provide good voter information. 96 97 3. Town Center Update — Finance Director Rolek and Terri Heaton, financial advisor from 98 Springsted, Inc. reported. Since the council's last discussion about the financing situation for the 99 Town Center bonds, staff and Ms. Heaton have looked at a variety of different options for 100 restructuring, including an interest rate swap scenario. 101 102 Ms. Heaton reviewed options including issuance of fixed rate bonds, a "swap" that begins as 103 variable rate and becomes fixed rate and a straight variable rate bond. The swap scenario is not 104 uncommon with cities; it's not recommended for a bond that relies on a tax levy. 105 Administratively the swap is more tedious but you can budget for it because you get regular 106 updates on impacts on your bonds. The benefits to a swap are outlined in the report and are 107 basically tied to rate savings. 108 109 The council recalled the request for additional information on the group that is representing all 110 the twenty eight holders, Marshall Investment Company. There is little information available 111 other than the group is made up of smaller entities; the effort to gain information on the group 112 will continue. 113 114 Director Rolek added, while there is always risk involved, what the city has going for it is that Alk 15 there are special assessments against the property and the right to collect those assessments goes W16 with the property as a lien. Mr. Rolek suggested that with the value of the land in the area of $14 117 million, it seems unlikely that such an asset would be allowed to go tax forfeit. 118 119 Staff would intend to continue their study of the different approaches, including information on 120 the all the impacts of a swap. It shouldn't have an impact on the city's credit rating in any case 121 since the bonds were issued as general obligation and that promise of payment from a tax levy 122 doesn't go away. 123 124 Staff will plan to present a recommendation at the first meeting in October. 125 126 4. 2009 Budget Update — Finance Director Rolek indicated that he had previously provided 127 the council with updated pages for their budget books that brought them up to date through the 128 last discussion. The council will consider preliminary budget actions at their meeting on 129 Monday, September 8. Tonight would be the council's opportunity for new questions or 130 comments. No comments were offered. 131 132 5. DeHaven Minor Subdivision (council requested) — Community Development Director 133 Grochala reported that the city has received an application from the DeHaven's for their 134 subdivision. Initially the application was found to be incomplete and they were informed as to 135 how they could proceed. Mr. Grochala added that he has since met with the DeHaven's to 136 further explain how their application can be finalized, including some title corrections regarding •137 a property question related to St. Paul Water Works. He explained the type of expenses that 138 would normally be charged to an escrow account. Currently there is nothing that has been