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<br />Item No: 7.C. <br />Meeting Date: January 9, 2017 <br />Type of Business: Council Business <br />Administrator Review: _____ <br />City of Mounds View Staff Report <br />To: Honorable Mayor and City Council <br />From: Mark Beer, Finance Director <br />Item Title/Subject: Resolution 8695 Authorizing Ehlers & Associates, Inc. and <br />Kennedy & Graven Chartered to act as Financial Advisor and <br />Bond Counsel for the Issuance of General Obligation Capital <br />Improvement Plan Bonds for Financing the Construction of a <br />Public Works Facility <br /> <br />The City Council is considering issuing G.O. CIP Bonds to finance the construction of a new <br />Public Works facility. This will require specialized services from an Independent Financial <br />Advisor (FA) and the opinion of a Bond Counsel (BC) to facilitate the issuance of the CIP bonds. <br />The City has used both entities for past bond issues and has a good working relationship with <br />both and both are highly regarded in the bond issuance industry. <br /> <br />Issuance costs are generally paid for out of bond proceeds but could be paid for out of city <br />reserves to help keep the total of bonds issued smaller. The estimated cost for FA services is <br />dependent on the size of the bond issue but would be approximately $25,000 to $27,000 for our <br />anticipated issuance size. The cost for BC services are estimated at $9,000. Staff is also <br />recommending that the City have this issue rated by a rating agency such as Moody’s or <br />Standard and Poor’s. The cost of the rating ($6,000 - $8,000) will provide for a lower interest <br />rate and pay for itself in the first year in lower interest costs. The FA will facilitate and assist in <br />the selection of a rating agency and work with the City during this process. <br /> <br />There will be some additional costs post issuance for annual disclosure, paying agent fees, and <br />arbitrage reporting. These costs will be considered and included in future budgets. <br /> <br />Resolution 8695 authorizes Ehlers & Associates, Inc. and Kennedy & Graven Chartered to <br />provide financial advisory services and bond counsel services for the G.O. CIP bonds proposed <br />to be issued for financing the new Public Works facility. I have attached the proposal from Ehlers <br />for financial advisory services for your review. <br /> <br /> <br />Respectfully submitted, <br /> <br /> <br />________________________ <br />Mark Beer <br />