HomeMy WebLinkAbout2017.06.05 (3)CITY OF HUGO Therapy Facilities Revenue Bonds
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Request for Conduit Bonds
The City of Hugo has been asked to consider issuing Therapy Facilities Revenue Bonds
Not to exceed $5.1 million
On behalf of the Autism Opportunities Foundation
Minnesota nonprofit
corporation dba the Minnesota Autism Center.
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Use of Proceeds
The bond proceeds will be used to finance the construction and equipping of an intensive therapy center for children and adults ages 10 to 21 diagnosed with autism spectrum disorder
(ASD). The project will be located in Eagan.
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Why Hugo?
Project located in Eagan
Each issuer is limited to $10 million of bank qualified bonds
Bank qualification:
a) gives the borrower a lower interest rate
b) provides the purchaser
favorable tax
treatment on interest earned from the bonds
We will retain $4.9 million in bank qualification capacity - The City of Hugo is not issuing any municipal bonds in 2017
Borrower
will pay an administrative fee for issuing the bonds
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Risks to the City of Hugo
City only serves as the bond “issuer.”
The Minnesota Autism Center is the actual borrower and is solely responsible for repaying investors.
The bonds are not moral obligations on the
part of the City
Will not constitute a debt of the City
Will not affect our credit rating
Borrower is solely responsible for on-going reporting requirements.
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Public Hearing
Notice published in “The Citizen.”
Denise Raunig – CFO of Minnesota Autism Center
Mary Ippel of Briggs and Morgan – the City’s Bond Counsel
Available to answer questions concerning the
bond issue and the project
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Recommendation
Approve Resolution Approving Issuance and Sale of Therapy Facilities Revenue Bonds
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