Agenda Packets - 2001/04/23 - Laserfiche WebLink

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Mounds View City Council April 9, 2001 Regular Meeting Page 6 expand. He further stated that, if the time comes to move on a Resolution, the Resolution should clearly state what the costs involved are. Council Member Stigney stated that the Mayor’s comments were well spoken but he still feels the need to look at the whole picture when spending his money as a taxpayer. He then noted the study mentioned the uncertainty of revenue in the bonds discussion and he stated he feels the City needs to be very cautious the second time around. Mr. Hammerschmidt explained the master plan presented almost two years ago was to come up with revenue producing items and a list of what items would be needed if the changes were made. He stated it was clearly stated there was at least a two year interval between each step and the decision was supposed to be made as to whether it was feasible to proceed with the next step. He then stated he felt the course did not need to compete with bars and restaurants but merely needed to provide minimal service for the golfers. He further stated he felt the key is to put money into the golf course and then worry about the amenities. Council Member Thomas asked if there would be a dedicated revenue stream for the bonds or if there was a need to use general obligation bonds. The Springsted Representative stated that based on the numbers they looked at the City could issue gross revenue bonds for the second course and show positive cash flow. He stated the City does not have the authority for general obligation bonds and would need a public vote to issue that type of bond. He stated they used gross revenue bonds because it is the most cost effective way to do it. He further stated that to do a pure revenue bond would cost considerably more than a gross revenue bond and due to the nature of the market that would be hard to sell. Council Member Thomas asked what gross percentage the City is plus or minus on the revenue percentage in terms of interest rate. The Springsted Representative stated he believed the City to be +.5% or possibly closer to +.25%. Council Member Thomas questioned whether there is the option to gain a little more interest rate if the City went with a straight general obligation bond. Council Member Stigney stated that one of the options they were looking at doing if the community supports it was to do an annual subsidy of residents and expansion of the course. He noted if the billboards come in that should resolve the debt service issue and the City would not need anything further. He stated that the study mentioned several options but he has seen only two options. The first is to loan the course money and the second is to reach the point to refinance. He then questioned what the other options are. The Springsted Representative stated he was not sure on the language usage but stated they have looked at the option of refinancing the existing debt but it has an attractive interest rate noting it would be something that should be refinanced at the call date but it is not worth struggle right