Agenda Packets - 1983/10/24 - Laserfiche WebLink

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SPRINGSTED INCORPORATED PUBLIC FINANCE ADVISORS 14 October 1983 Mr, Donald F. Pauley, Administator Mr. Donald Brager, Finance Director City Hall 2401 Highway 10 Mounds View, Minnesota 55112 RE: Defeasonce of Improvement Bond Issues We have prepared this study for your consideration as a proposal for doing the defeasonce of the City's Improvement Bond Fund and also as a proposal to be retained by the City to serve as its financial advisor. The study demonstrates a Procedure for defeasonce of the five improvement bond issues which were sold in the years 1965 through 1974 and are included in the common Improvement Bond Fund. As a separate exhibit we have also shown the cash flow and cash requirements for the 1981 Improvement Bond Fund, We have not attempted to make any adjustments to the advance refunding bond issue of 1976. That bond issue appears to be adequately supported and the interest rates on the outstanding maturities are lower than rates which could be received today. The bonds are subject to cull at any interest payment date end therefore if in the future the cash flow is not adequate to meet the debt service payments, the City could refund the outstanding bonds by simply calling them and issuing a new bond issue more structured to the then current projected cash flow. We do not anticipate any problems will arise with that issue. In preparing our study we have relied heavily upon the City's 1982 audit and the Special Assessment Debt Service Study,,, both prepared by DeLaHunt Veto & Co. Ltd. for information relative to the special assessments and some cash balances. Upon an actual defeasonce we would carefully verify again the numbers to make sure that everything is properly structured. The most significuit part of this study is the defeasance of the Improvement Bond Fund. Schedules A-1 through A-5 are the semiannual debt service requirements for each of the individual bond issues. They represent all remaining debt service as of October I, 1983. Schedule A-6 is the combined debt service schedule for the Improvement Bond Fund in its entirety. Schedule B, pages I through 3 shows the defeasonce of the bond issues through the purchase and cash flow of the securities to be acquired. We hasten to point out that these are strictly estimates and are based upon prices determined frori; the Friday, October 7 Wall Street Journal. We used a single source for pricing which can be verified by the ity if you so desire to check the accuracy of our ` numbers. There are a total of 43 separate securities transactions involved and therefore it is a very complicated process to determine the most efficient cash flow for the required escrow account. We have also separated the securities 800 Osborn Building, Saint Paul, Minnesota 55102 (612) 222.4241 250 North Sunnyslope Road, Brookfield, Wisconsin 53005 (414) 782-8212