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HomeMy WebLinkAbout2006-147 Council Resolution• Council Member O'Donnell introduced the following resolution and moved its adoption: • CITY OF LINO LAKES COUNTY OF ANOKA RESOLUTION NO. 06 -147 RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF APPROXIMATELY $3,025,000 GENERAL OBLIGATION CAPITAL IMPROVEMENT PLAN BONDS, SERIES 2006E BE IT RESOLVED By the City Council of the City of Lino Lakes, Anoka County, Minnesota (City) as follows: 1. It is hereby determined that: (a) The Lino Lakes Economic Development Authority (the "Authority ") previously issued its $5,350,000 Lino Lakes Economic Development Authority Lease Revenue Bonds, Series 1998A (City of Lino Lakes, Minnesota Lease Obligation) dated August 1, 1998 (the "Series 1998A Bonds "), the proceeds of which were used to finance the acquisition and construction of a civic center complex including the city hall, police station and an early childhood education facility currently leased to Independent School District No. 11 (together, the "Complex "). (b) The Series 1998A Bonds are secured by lease payments by the City pursuant to a Lease - Purchase Agreement between the Authority and the City dated August 1, 1998 (the "Lease). (c) Under the Lease, the City has the option to prepay lease payments in whole or in part, and thereby redeem the outstanding Series 1998A Bonds in whole or in part. (d) The City is authorized by Minnesota Statutes, section 475.521 (the "Act ") to finance certain capital improvements under an approved capital improvement plan by the issuance of general obligation bonds of the City payable from ad valorem taxes. Capital improvements include (among other things) acquisition or betterment of public lands, buildings or other improvements for the purpose of a city hall and public safety facility. (e) The city hall and police station portions of the Complex (such portions together referred to as the "Facilities ") make up more than 79.5 percent of the total • square footage of the Complex. The Facilities are "capital improvements" within the meaning of the Act. • (f) On September 11, 2006 the City held a public hearing regarding a five year capital improvement plan (the "Plan "), and regarding issuance of bonds in the maximum principal amount of $3,950,000 to finance the acquisition of the Facilities through prepayment of a portion of the lease payment under the Lease in an amount allocable to the Facilities, accomplished by issuance of bonds to refund an allocable portion of the Series 1998A Bonds, all in accordance with the Act. On the same date, the City Council approved the Plan providing for issuance of such refunding bonds. (g) The City is authorized by Minnesota Statutes, Chapter 475, and specifically Section 475.67, Subdivision 3 thereof, to issue and sell its general obligation bonds to refund obligations and the interest thereon before the due date of the obligations, if consistent with covenants made with the holders thereof, when determined by the City Council to be necessary or desirable for the reduction of debt service cost to the City or for the extension or adjustment of maturities in relation to the resources available for their payment; (h) Minnesota Statutes, Section 475.67, subdivision 4 permits the sale of refunding obligations during the six month period prior to the date on which the obligations to be refunded may be called for redemption; (i) It is necessary and desirable to reduce debt service costs that the City issue approximately $3,025,000 General Obligation Capital Improvement Plan Refunding Bonds, Series 2006B (the "Bonds ") to refund the 2011 through 2019 • maturities of the Authority's Series 1998A Bonds together with $55,000 of the principal amount of the 2010 maturity of the Series 1998A Bonds, which $3,345,000 in aggregate principal amount is currently outstanding and is callable on February 1, 2006 and any date thereafter. • (j) The outstanding principal amount of the Series 1998A Bonds is $4,210,000, and proceeds of the Bonds will be used to refund no more than 79.5 percent of such outstanding principal amount, which represents the portion of the Series 1998A Bonds allocable to the Facilities (compared to the Complex as a whole). (k) As required by the Act, the City has determined that: (i) the expected useful life of the Facilities will be at least five years; and (ii) the amount of principal and interest due in any year on all outstanding bonds issued by the City under the Act, including the Bonds, will not exceed .16 percent of the taxable market value of property in the City for taxes payable in 2006. (I) The City is authorized by Minnesota Statutes, section 475.60, subdivision 2(9) to negotiate the sale of the Bonds, it being determined that the City has retained an independent financial adviser in connection with such sale. 2. To provide monies to refund a portion of the Series 1998A Bonds as described in Section 1, the City will issue and sell Bonds in the amount of approximately $2,996,263. To provide in part the additional interest required to market the Bonds at • this time, additional Bonds will be issued in the amount of approximately $28,737. The excess of the purchase price of the Bonds over the sum of $2,996,263 will be credited to the debt service fund for the Bonds for the purpose of paying interest first coming due on the additional Bonds, or applied to the refunding of the Series 1998A Bonds as determined by the City's financial advisor. The Bonds will be issued, sold and delivered in accordance with the terms of the following Terms of Proposal: (The remainder of this page is intentionally left blank) • • • THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS: • • TERMS OF PROPOSAL $3,025,000* CITY OF LINO LAKES, MINNESOTA GENERAL OBLIGATION CAPITAL IMPROVEMENT PLAN REFUNDING BONDS, SERIES 2006E (BOOK ENTRY ONLY) Proposals for the Bonds will be received on Monday, October 23, 2006, until 10:30 A.M., Central Time, at the offices of Springsted Incorporated, 380 Jackson Street, Suite 300, Saint Paul, Minnesota, after which time they will be opened and tabulated. Consideration for award of the Bonds will be by the City Council at 6:30 P.M., Central Time, of the same day. SUBMISSION OF PROPOSALS Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the time of sale specified above. All bidders are advised that each Proposal shall be deemed to constitute a contract between the bidder and the City to purchase the Bonds regardless of the manner in which the Proposal is submitted. (a) Sealed Bidding. Proposals may be submitted in a sealed envelope or by fax (651) 223 -3046 to Springsted. Signed Proposals, without final price or coupons, may be submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting to Springsted the final Proposal price and coupons, by telephone (651) 223 -3000 or fax (651) 223 -3046 for inclusion in the submitted Proposal. OR (b) Electronic Bidding. Notice is hereby given that electronic proposals will be received via PARITY®. For purposes of the electronic bidding process, the time as maintained by PARITY® shall constitute the official time with respect to all Bids submitted to PARITY®. Each bidder shall be solely responsible for making necessary arrangements to access PARITY® for purposes of submitting its electronic Bid in a timely manner and in compliance with the requirements of the Terms of Proposal. Neither the City, its agents nor PARITY® shall have any duty or obligation to undertake registration to bid for any prospective bidder or to provide or ensure electronic access to any qualified prospective bidder, and neither the City, its agents nor PARITY® shall be responsible for a bidder's failure to register to bid or for any failure in the proper operation of, or have any liability for any delays or interruptions of or any damages caused by the services of PARITY®. The City is using the services of PARITY® solely • as a communication mechanism to conduct the electronic bidding for the Bonds, and PARITY® is not an agent of the City. If any provisions of this Terms of Proposal conflict with information provided by this Terms of Proposal shall control. Further information about PARITY®, including any fee charged, may be obtained from: PARITY®, 1359 Broadway, 2nd Floor, New York, New York 10018 Customer Support: (212) 849 -5000 DETAILS OF THE BONDS The Bonds will be dated November 1, 2006, as the date of original issue, and will bear interest payable on February 1 and August 1 of each year, commencing February 1, 2007. Interest will be computed on the basis of a 360 -day year of twelve 30 -day months. The Bonds will mature February 1 in the years and amounts as follows: 2010 $ 85,000 2013 $350,000 2016 $385,000 2011 $320,000 2014 $355,000 2017 $405,000 2012 $330,000 2015 $370,000 2018 $425,000 The City reserves the right, after proposals are opened and prior to award, to increase or reduce the principal amount of the Bonds offered for sale. Any such increase or reduction will be made in multiples of $5,000 in any of the maturities. In the event the principal amount of the Bonds is increased or reduced, any premium offered or any discount taken by the successful bidder will be increased or reduced by a percentage equal to the percentage by which the principal amount of the Bonds is increased or reduced. Proposals for the Bonds may contain a maturity schedule providing for a combination of serial bonds and term bonds. All term bonds shall be subject to mandatory sinking fund redemption at a price of par plus accrued interest to the date of redemption and must conform to the maturity schedule set forth above. In order to designate term bonds, the proposal must specify "Years of Term Maturities" in the spaces provided on the Proposal Form. BOOK ENTRY SYSTEM The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of The Depository Trust Company ( "DTC "), New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The • purchaser, as a condition of delivery of the Bonds, will be required to deposit the Bonds with DTC. REGISTRAR The City will name the registrar, which shall be subject to applicable SEC regulations. The City will pay for the services of the registrar. OPTIONAL REDEMPTION The City may elect on February 1, 2016, and on any day thereafter, to prepay Bonds due on or after February 1, 2017. Redemption may be in whole or in part and if in part at the option of the City and in such manner as the City shall determine. If less than all Bonds of a maturity are called for redemption, the City will notify DTC of the particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. SECURITY AND PURPOSE II The 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. The proceeds will be used to refund a portion of the February 1, 2010 maturity and the February 1, 2011 through February 1, 2018 maturities of the Lino Lakes Economic Development Authority's Lease Revenue Bonds, Series 1998A (City of Lino Lakes, Minnesota Lease Obligation), dated August 1, 1998. TYPE OF PROPOSALS Proposals shall be for not less than $2,996,263 and accrued interest on the total principal amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ( "Deposit ") in the form of a certified or cashier's check or a Financial Surety Bond in the amount of $30,250, payable to the order of the City. If a check is used, it must accompany the proposal. If a Financial Surety Bond is used, it must be from an insurance company licensed to issue such a bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central Time, on the next business day following the award. If such Deposit is not received by that time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement.The Deposit received from the purchaser, the amount of which will be deducted at settlement and no interest will accrue to the purchaser, will be deposited by the City. In the event the purchaser fails to comply with the accepted proposal, said amount will be retained by the City. No proposal can be withdrawn or • amended after the time set for receiving proposals unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been made. Rates shall be in integral multiples of 5/100 or 1/8 of 1%. Rates must be in level or ascending order. Bonds of the same maturity shall bear a single rate from the date of the Bonds to the date of maturity. No conditional proposals will be accepted. AWARD The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in accordance with customary practice, will be controlling. The City will reserve the right to: (i) waive non - substantive informalities of any proposal or of matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals without cause, and (iii) reject any proposal that the City determines to have failed to comply with the terms herein. BOND INSURANCE AT PURCHASER'S OPTION If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment therefor at the option of the underwriter, the purchase of any such insurance policy or the issuance of any such commitment shall be at the sole option and expense of the purchaser of the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of insurance shall be paid by the purchaser, except that, if the City has requested and received a rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall be the responsibility of the purchaser. Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on the Bonds. CUSIP NUMBERS If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers shall be paid by the purchaser. SETTLEMENT Within 40 days following the date of their award, the Bonds will be delivered without cost to the purchaser through DTC in New York, New York. Delivery will be subject to receipt by the purchaser of an approving legal opinion of Kennedy & Graven, Chartered of Minneapolis, Minnesota, and of customary closing papers, including a no- litigation certificate. On the date of settlement, payment for the Bonds shall be made in federal, or equivalent, funds that shall be received at the offices of the City or its designee not later than 12:00 Noon, Central Time. Unless compliance with the terms of payment for • the Bonds has been made impossible by action of the City, or its agents, the purchaser shall be liable to the City for any loss suffered by the City by reason of the purchaser's non - compliance with said terms for payment. CONTINUING DISCLOSURE In accordance with SEC Rule 15c2- 12(b)(5), the City will undertake, pursuant to the resolution awarding sale of the Bonds, to provide annual reports and notices of certain events. A description of this undertaking is set forth in the Official Statement. The purchaser's obligation to purchase the Bonds will be conditioned upon receiving evidence of this undertaking at or prior to delivery of the Bonds. OFFICIAL STATEMENT The City has authorized the preparation of an Official Statement containing pertinent information relative to the Bonds, and said Official Statement will serve as a nearly final Official Statement within the meaning of Rule 15c2 -12 of the Securities and Exchange Commission. For copies of the Official Statement or for any additional information prior to sale, any prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated, 380 Jackson Street, Suite 300, Saint Paul, Minnesota 55101, telephone (651) 223 -3000. The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts and interest rates of the Bonds, together with any other information required by law, shall constitute a "Final Official Statement" of the City with respect to the Bonds, as that term is defined in Rule 15c2- 12. By awarding the Bonds to any underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than seven business days after the date of such award, it shall provide without cost to the senior managing underwriter of the syndicate to which the Bonds are awarded 150 copies of the Official Statement and the addendum or addenda described above. The City designates the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for purposes of distributing copies of the Final Official Statement to each Participating Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring the receipt by each such Participating Underwriter of the Final Official Statement. BY ORDER OF THE CITY COUNCIL /s/ Julie Bartell City Clerk 3. Springsted Incorporated is authorized and directed to negotiate the Bonds in accordance with the foregoing Terms of Proposal, subject only to the condition that if a petition requesting a vote on the issuance of the Bonds, signed by voters equal to five percent of the votes cast in the last general election, is filed with the City Clerk on or before October 11, 2006 (30 days after the public hearing regarding the Bonds), the City may issue the Bonds only after obtaining approval of a majority of voters voting on the question at an election. If no timely petition is received, the City Council will meet at 5:00 P.M. on Monday, October 23, 2006, to consider proposals on the Bonds and take any other appropriate action with respect to the Bonds. 4. The law firm of Kennedy & Graven, Chartered, as bond counsel for the City, is authorized to act as bond counsel and to assist in the preparation and review of necessary documents, certificates and instruments relating to the Bonds. The officers, employees and agents of the City are hereby authorized to assist Kennedy & Graven, Chartered in the preparation of such documents, certificates, and instruments. (The remainder of this page is intentionally left blank) • • Adopted by the Lino Lakes City Council this 25th day of September, 2006. The motion for the adoption of the foregoing resolution was duly seconded by Council Member Carlson and upon vote being taken thereon, the following voted in favor thereof: The following voted against same: Whereupon said resolution was declared duly passed and adopted. Julia ' ne Bartell, Cit; Clerk • •