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15 <br />To: Mark Casey, City Manager <br />From: Shelly Rueckert, Finance Director <br />Date: 3/20/2012 <br />By way of background, the process for requesting an MSA advance requires a <br />council resolution. The City Engineer will send a cover letter requesting the advance <br />along with the resolution to State Aid. Advance requests are reviewed on a first- <br />come -first -serve basis. The State Aid finance department will let the City know if the <br />advance is approved. Cities are allowed to request advancement for Municipal State <br />Aid projects costs (or for costs previously incurred). <br />The maximum request equals five times the City's annual State Aid construction <br />allotment. The City was recently allocated $204,796 in 2012 for Municipal State Aid <br />projects. Based on the City's current allotment, the requested advance totals <br />$1,023,980. If the advance is approved from State Aid, annual State Aid <br />reimbursements would not be made the next 5 years as that amount would have <br />been paid up -front. Given that $1,023,980 does not fully deplete our State Aid <br />balance the City can make a similar request for funds in 2013 to drawn down an <br />additional allotment. This would maintain the 5 year deferral of reimbursements. <br />Please note that the State account does not bear interest and the State prefers that <br />Cities drawn down their account in connection with MSA expenditures. The <br />advantage for the City is it can invest the proceeds and replenish the funds used for <br />MSA construction expenditures incurred. City Staff is recommending that the <br />Council pass the resolution. <br />3301 Silver Lake Road * St. Anthony, MN 55418 * 612.7823301 * 6127823302 (fax) <br />