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Mounds View City Council October 25, 2004 <br />Regular Meeting Page 2 <br /> <br />Council Member Quick asked how much the billboards would pay the City annually. 1 <br /> 2 <br />Director Ericson stated that it will begin at $260,000 and would escalate over the course of the 3 <br />20-year contract, when it would end at around $500,000. 4 <br /> 5 <br />Council Member Quick asked when the bonds would be paid off. 6 <br /> 7 <br />Director Ericson stated he believed it was around 2012. 8 <br /> 9 <br />Finance Director Hansen stated that the bonds would be paid off around 2012-2013, and then 10 <br />over the next five years the internal loan would be paid back, and the projection is that the golf 11 <br />course would be debt free in about 2018. 12 <br /> 13 <br />Council Member Quick asked if they would need to borrow money to the golf course next year. 14 <br /> 15 <br />Finance Director Hansen stated that there would be one last year of a small internal loan. He 16 <br />stated the internal loan might go up slightly, but the total debt will be going down each year. 17 <br /> 18 <br />Council Member Quick asked if the $260,000 would be over and above any revenues that were 19 <br />made on the golf course, and Finance Director Hansen stated that it would be. 20 <br /> 21 <br />Council Member Quick stated that according to the contract, they are guaranteed a four percent 22 <br />increase on that, and Finance Director Hansen stated that he believed that that was the number in 23 <br />the contract. 24 <br /> 25 <br />Council Member Quick asked what they are going to be at per year by the time they pay off the 26 <br />debt, and Finance Director Hansen stated that in the 15 to 20 year range, it would be between 27 <br />$300,000 and $400,00 per year in revenue. 28 <br /> 29 <br />Council Member Quick stated that it sounded like they had the situation in hand and they would 30 <br />pay off the bonds on time and would be able to pay off the internal loans, including interest, and 31 <br />still have a golf course. 32 <br /> 33 <br />Council Member Stigney stated that any income from the billboards will require that the 34 <br />billboards are completely advertised, and that remained to be seen. He asked why the billboard 35 <br />revenue doesn’t go into the General Fund to reduce the taxpayers’ debt, instead of stringing along 36 <br />the golf course. 37 <br /> 38 <br />Finance Director Hansen stated that when they sold the golf course bonds, all revenues derived 39 <br />from the golf course are dedicated to the golf course as long as those bonds are outstanding. 40 <br /> 41 <br />Council Member Stigney stated that with some legal opinions and changes, they could get that 42 <br />changed around. 43 <br /> 44