Agenda Packets - 1993/12/13 - Laserfiche WebLink

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STAFF REPORT PAGE TWO DECEMBER 13, 1993 However, it must be noted that, while the City taxpayers will not be obligated to retire the debt on the Revenue Bonds, in the unlikely event that the course's revenues (over a period of time) were not sufficient to pay the debt service, the City would have to re- evaluate the operations of the course and its revenue/expenditure stream. Such re- evaluation might result in one or a combination of several courses of action, only one of which may require a general tax subsidy. Other actions could be restructuring the course operations, lease or sale options. This discussion is called to your attention only to inform the Council that, while the Revenue Bond proposed is a financially sound issue, developed from a well-advised and comprehensive revenue/expenditure analysis, there are some risks, however limited. However, every action a City takes, in terms of any development project — be it commercial/industrial or an enterprise endeavor such as the golf course, involves a measure of risk. In this case, the benefits, as determined by the Task Force, far outweigh the possible risks. The City's financial consultant Bob Thistle and Bond Counsel Jim O'Meara have reviewed the market analysis conducted by Effective Golf Course Systems and have determined that the gross revenue from the course will "be sufficient to pay, when due, the principal of and interest on the Bonds." Bob Thistle will be present Monday night to explain the details of the Bond sale. The attached resolution includes several blank areas which cannot be completed until the Bonds are sold. It is anticipated that the date of sale will be December 13, 1993. Subsequent to the Bond sale, a!I information will be provided and the Council will be required to take formal action to approve the interest rates and enter into the Bond Purchase Agreements. In the event that all of the bonds are not sold on Monday and the sale needs to be carried over into Tuesday, it may be necessary for the Council Meeting to be continued until Tuesday evening (the time to be at the Council's discretion). Bob Thistle will advise Monday night.