Agenda Packets - 1983/11/28 - Laserfiche WebLink

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-4- be made to other City funds to tinance improvement projects. Such a fund would br: of benefit to the City in two ways. First, internal financing is less costly than external financing of projects and linann•in,'l cn:;ls could log r!liminato(l, i.e„ aLfornuyr, and consultants Fees on bond issues. Secondly, such a fund could be a Lool to assist in managing the general purpose property tax levy. For example, $1.1,000 is budgeted for City Hall roof repairs in 1984. The repairs are being paid from the reneral Fund which is heavily dependent upon property tax dollars. It an improvement revolving fund existed a loan for the repairs with a payback period of several years could have been made. In so doing, the burden on the tax levy would have been reduced and the loan would have contributed to the goal of minimizing increases in the property tax levy. RECOMMENDATION: Council provide staff with direction as to the undertaking of a cash defeasance of the bonds in the Improvement Bond Redemption Fund and if a defeasance is undertaken, provide direction as to its timing and the uses of the anticipated surplus in the fund. To provide this direction we request you answer the following questions: 1. Is there an immediate need for funds which would justify a cash defeasance of the bonds in the Improvement Bond Redemp- tion Fund? 2. It there is an immediate need for funds which justifies a cash defeasance, how soon are those funds needed? a. should a rash defeasance be undertaken at whatever interest rate on investments is available in the market today? or b. Ehculd 3 ca;lr defeasance only be undertaken if a certain interest rate on investments can be realized? What Should that interest rate be? 3. If a cash defeasance is undertaken how should the resultant anticipated surplus funds be used? A representative of Springstead, Inc. will be in attendance to answer any questions you may have on this matter. DB/pf Attachments