8.5. SR 05-07-2012REQUEST FOR ACTION
TO ITEM NUMBER
Ma or and Ci Council 8.5
AGENDA SECTION MEETING DATE PREPARED BY
General Business Ma 7, 2012 Tim Simon, Finance Director
ITEM DESCRIPTION REVIEWED By
Resolution Providing for the Redemption of Certain Cal Portner, Ci Administrator
Outstanding General Obligation Tax Increment Bonds, Series REVIEWED BY
2000A
ACTION REQUESTED
The Council is asked to adopt a resolution providing for the redemption of certain outstanding general
obligation tax increment bonds Series 2000A of the city.
BACKGROUND/DISCUSSION
In 2000, the City Council authorized the issuance of $800,000 General Obligation Tax Increment Bonds,
Series 2000A for financing a portion of the costs of the East Elk River Improvement Project in tax
increment district (TIF) 19. The bonds have a final maturity of February 1, 2015, and the interest rate
range is 4.45-5.30 percent. Under the terms of the bond sale, notice must be given to the bond holders at
least thirty days prior to the redemption in whole or in part on or after February 1, 2007. Upon Council
approval, staff will provide written notice and payoff the bonds on June 7, 2012.
The redemption of the 2000A bonds has been anticipated as a debt service reserve was established and
now sufficient funds exist to call in the bonds.
FINANCIAL IMPACT
The amount needed on June 7, 2012 will be $235,000 plus accrued interest. The funding comes from the
TIF 19 Fund. The city will save approximately $20,790 in interest expense over the next three years.
ATTACHMENTS
Resolution providing for the redemption of certain outstanding general obligation tax increment
bonds Series 2000A of the city
Action Motion by Second by Vote
Follow Up
P9i~E13E8 ~T
C:\Users\jmiller\AppData\Local\Microsoft\Windows\Temporary Internet '"
Files\Content.IES\RFSSZZ3F\prepaymentofTIFl9bonds.docx
Extract of Minutes of Meeting of the
City Council of the City of Elk River,
Sherburne County, Minnesota
Pursuant to due call and notice thereof, a regular meeting of the Council of the City of Elk
River, Minnesota, was duly held in the City Hall in the City of Elk River, on Monday, May 7, 2012,
commencing at 6:30 P.M.
The following members were present:
and the following were absent:
Member
introduced the following resolution and moved its adoption:
RESOLUTION N0.12-
RESOLUTION PROVIDING FOR THE REDEMPTION OF CERTAIN OUTSTANDING
GENERAL OBLIGATION TAX INCREMENT BONDS, SERIES 2000A OF THE CITY
BE IT RESOLVED By the City Council of the City of Elk River, Sherburne County,
Minnesota (the "City"), as follows:
1. The City has issued its General Obligation Tax Increment Bonds, Series 2000A,
dated November 1, 2000 (the "Bonds"), in the original aggregate principal amount of $800,000.
The Bonds maturing on February 1 in the years 2013 through and including 2015, in the aggregate
principal amount of $235,000 (the "Callable Bonds"), are subject to redemption and prepayment on
any date at a price of par plus accrued interest.
2. It is determined that it is in the sound financial management of the City that the
Callable Bonds be prepaid and redeemed on June 7, 2012, or such later date for which proper notice
of call may be given, and such bonds are hereby called for redemption on such date.
396199v2 JSB EL185-15
3. The City Finance Director is authorized and directed to request that U.S. Bank
National Association (formerly known as U.S. Bank Trust National Association), the paying agent
and bond registrar (the "Registrar"), mail the Notice of Call for Redemption in substantially the
form attached hereto as EXHIBIT A to the registered owners of each Bond to be redeemed at the
addresses shown on the registration books kept by the Registrar.
The motion for the adoption of the foregoing resolution was duly seconded by Member
and upon vote being taken thereon, the following voted in favor thereof:
and the following voted against:
whereupon said resolution was declared duly passed and adopted this 7~' day of May, 2012.
John J. Dietz, Mayor
ATTEST:
Tina Allard, City Clerk
396199v2 JSB EL185-15 2
EXHIBIT A
NOTICE OF CALL FOR REDEMPTION
GENERAL OBLIGATION TAX INCREMENT BONDS, SERIES 2000A
CITY OF ELK RIVER
SHERBURNE COUNTY, MINNESOTA
NOTICE IS HEREBY GIVEN that, by order of the City Council of the City of Elk River,
Sherburne County, Minnesota, there have been called for redemption and prepayment on
June 7, 2012
all outstanding bonds of the City designated as General Obligation Tax Increment Bonds,
Series 2000A, dated November 1, 2000, having stated maturity dates of February 1 in the years
2013 through 2015, both inclusive, totaling $235,000 in principal amount:
Year of Maturity Amount
CUSIP
2013 $75,000 287407 ZR4
2014 80,000 287407 ZS2
2015 80,000 287407 ZTO
The bonds are being called at a price of par plus accrued interest to June 7, 2012, on which date
all interest on said bonds will cease to accrue. Holders of the bonds hereby called for redemption
are requested to present their bonds for payment at the main office of U.S. Bank National
Association (formerly known as U.S. Bank Trust National Association), in St. Paul, Minnesota,
on or before June 7, 2012.
If by mail:
U.S. Bank National Association
Corporate Trust Operations
60 Livingston Avenue
EP-MN-WS3C
St. Paul, MN 55107
If b,~hand:
U.S. Bank National Association
60 Livingston Avenue
3`d Floor -Bond Drop Window
St. Paul, MN 55107
Important Notice: In compliance with the Jobs and Growth Tax Relief Reconciliation
Act of 2003, federal backup withholding tax will be withheld at the applicable backup
withholding rate in effect at the time the payment by the redeeming institutions if they are not
provided with your social security number or federal employer identification number, properly
certified. This requirement is fulfilled by submitting a W-9 Form, which may be obtained at a
bank or other financial institution.
Dated: May 7, 2012.
BY ORDER OF THE CITY COUNCIL
396199v2 JSB EL185-15 A-1
STATE OF MINNESOTA )
COUNTY OF SHERBURNE ) SS.
CITY OF ELK RIVER )
I, the undersigned, being the duly qualified and acting City Clerk of the City of Elk River,
Minnesota (the "City"), do hereby certify that I have carefully compared the attached and foregoing
extract of minutes of a regular meeting of the City Council held on Monday, May 7, 2012, with the
original thereof on file in my office and the same is a full, true and complete transcript therefrom
insofar as the same relates to the prepayment and redemption of General Obligation Tax Increment
Bonds, Series 2000A of the City.
WITNESS My hand as City Clerk this 7th day of May, 2012.
Tina Allard, City Clerk
City of Elk River, Minnesota
396199v2 JSB EL185-15