HomeMy WebLinkAboutCity Council - 02/05/2002 - HRA APPROVED MINUTES
HOUSING AND REDEVELOPMENT AUTHORITY
TUESDAY,FEBRUARY 5,2002 7:00 PM,CITY CENTER
Council Chamber
8080 Mitchell Road
CITY COUNCIL: Mayor Nancy Tyra-Lukens, Councilmembers Sherry Butcher,Ron Case,
David Luse and Jan Mosman
CITY COUNCIL STAFF: City Manager Carl Jullie,Parks &Recreation Services Director Bob
Lambert,Public Works Services Director Eugene Dietz, Community Development and Financial
Services Director Don Uram, City Planner Michael Franzen, City Attorney Ric Rosow and
Council Recorder Jan Nelson Curielli
I. ROLL CALL/CALL THE MEETING TO ORDER
Acting Mayor Case convened the HRA at 7:05 p.m. Mayor Tyra-Lukens was absent.
II. RESOLUTION HRA 2002-01 RELATING TO $8,050,000 LEASE REVENUE
REFUNDING BONDS (CITY HALL AND COMMUNITY CENTER PROJECTS),
SERIES 2002A; AUTHORIZING THE ISSUANCE,AWARDING THE SALE
AND PRESCRIBING THE FORM THEREOF AND AUTHORIZING THE
EXECUTION OF A TRUST INDENTURE,AN ESCROW AGREEMENT AND A
LEASE-PURCHASE AGREEMENT
City Manager Jullie said we are asking the HRA to review the documents related to a
bond refunding action that has been recommended during this favorable climate of
interest rates.
Community Development and Financial Services Director Don Uram summarized the
process of refunding and introduced Mr. Paul Donna of Juran&Moody.
Paul Donna said the purpose of the bond issue is to advance refund certain maturities of
the HRA's Series 1992A Bonds (Community Center) and Series 1992B Bonds (City
Hall) for interest cost savings. The proceeds of this bond issue will be used to pay off the
principal balance of the 2003-2012 maturities totaling $1,735,000 of the HRA's Series
1992A Bonds and the principal balance of the 2004-2012 maturities totaling $6,080,000
of the HRA's Series 1992B Bonds. He said the estimated net present value debt service
savings would be$627,112.
Donna noted the City received a bond rating upgrade from Moody's Investment Service
rating from Aa3 to Aa2 because of our strong tax base, favorable debt level, and
anticipated modest levels of future borrowing.
HOUSING AND REDEVELOPAMNT AUTHORITY hHNUTES
February 5,2002
Page 2
Uram said that the Council adopted three policies about four years ago that helped us
• achieve the upgraded rating: the reservation of a 30-40%fund balance, establishment of a
revenue stability fund for future operations, and the annual transfer of funds to the capital
improvement program to support a pay-as-you-go capital budget. He noted that Moody's
rated the City's HRA bonds Aa2 and the City's General Obligation bonds Aal.
Donna said the increase in the rating generated between $30,000-$50,000 savings in
interest.
Butcher congratulated Staff on the upgrade and reiterated the Council's support of the
existing fmancial policies. Butcher said this means we are almost at the top in terms of
ratings.
Donna said there are only 12 communities in Minnesota that have ratings equal to or
better than this rating.
Luse asked what kind of dollars would be saved if we look at $10 million rather than $8
million. Donna replied that the rating upgrade would save the City between five and ten
basis points and going out ten years could equate to $60,000 to $75,000 savings in
interest.
MOTION: Mosman moved, seconded by Butcher, to adopt Resolution HRA 2002-01
Relating To $8,050,000 Lease Revenue Refunding Bonds (City Hall And Community
• Center Projects), Series 2002A; Authorizing The Issuance, Awarding The Sale And
Prescribing The Form Thereof And Authorizing The Execution Of A Trust Indenture, An
Escrow Agreement, And A Lease-Purchase Agreement. Motion carried 4-0.
III. ADJOURNMENT
MOTION: Butcher moved, seconded by Mosman,to adjourn the HRA. Motion carried
4-0.Acting Mayor Case adjourned the HRA at 7:15 p.m.
Approval of February 5,2002 Minutes
(Please Initial)
GO--Sherry Butcher
Ronald Case
Df/--David Luse
Jan Mosman
Nancy Tyra-Lukens
Approved on February 19,2002.