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City of St. Anthony I8 February 24, 2000 Page 2 • Public Works Building Project Projected Cost: $ 6,000,000 Lease Revenue—annual debt service required: 555,000 Revenue Sources (internal) Interest Earnings—Water Filtration Fund (125,000) Liquor Revenues (100,000) Capital Equipment (assumes capital equipment notes being issued to fund equipment (75,000) There are no revenues available within operating levy city/levy limits Total Debt Service Shortfall: $ 255,000 The City is short approximately $255,000 per year in internal funds to finance a lease-revenue issue for the Public Works Building. • Option 1: Lease-Revenue Bond Based upon available internal revenues of $300,000, the City can afford $3.525 million, using a lease revenue bond approach for the building. This is a 20-year commitment that directly affects the City's operating cash flow over that time period and limits the flexibility of future City Councils. Further, using only available cash may not be the best approach in building a facility to meet the City's public service needs for the next 40 plus years. The cost of the building could be increased by using part or all of the $1 million that is potentially available from the Water Filtration Fund. (See "Water Filtration Principal" below.) Option 2: GO Referendum Consider maximum full Council support on a referendum to build a facility costing $6 million that would meet the needs of the community over the next 30-50 years. This is the lowest cost . option to the taxpayers. The cost of this option on a $6 million building is $521,000 per year or approximately $204 per year per property parcel valued at $150,000. The cost could be reduced by reducing the scope of the facility. Also, some cost could be offset by applying up to $1 million from the Water Filtration Fund identified below.