3.5 EDSR 11-13-2012 ht ik REQUEST FOR ACTION
River
To Item Number
Economic Development Authority 3.5
Agenda Section Meeting Date Prepared by
Consent November 13, 2012 Tim Simon, Finance Director
Item Description Reviewed by
Consider resolution calling for a public hearing to refinance the
EDA General Obligation 2007 bonds Reviewed by
Action Requested
A resolution calling for a public hearing on the issuance of General Obligation Refunding Bonds and
authorizing the publication of a notice of hearing.
Background/Discussion
The purpose of calling for a public hearing on December 10th is to consider refunding the General
Obligation Bonds, Series 2007 that were issued by the EDA for the YMCA project for an interest
savings. The 2007 bonds were issued in the amount of$10,000,000 and have a final maturity of February
1, 2033. The true interest cost of the original bonds is 4.1780%. We are not considering the 2008 bonds
that were issued since no call date exists on those shorter term bonds.
Under the lease agreement, the EDA levies an amount for two-thirds of annual principal and interest and
the YMCA pays the remaining one-third.
Per our debt policy"advance refunding bonds shall not be utilized unless present value savings of 4%to
5%of refunded principal is achieved and unless the call date is within 4 years. The state law minimum is
3%of refunded principal. Bonds shall not be advance refunded if there is a reasonable chance that
revenues will be sufficient to pre-pay the debt at the call date."
Financial Impact
Ehlers will be at the December 10 meeting to review the current interest rate environment and the
estimated savings.
Attachments
• Resolution calling for a public hearing on the issuance of General Obligation Refunding Bonds
and authorizing the publication of a notice of hearing.
Action Motion by Second by Vote
Follow Up
C:A Users\dhucbncr\Appllata\Local\Microsoft\Windows\Temporary Internet Files\Content.Outlook\X3O71NQV\YMCArefundingbonds.doc
EXTRACT OF MINUTES OF MEETING OF THE
BOARD OF COMMISSIONERS OF THE ECONOMIC DEVELOPMENT AUTHORITY OF
THE CITY OF ELK RIVER,
SHERBURNE COUNTY,MINNESOTA
Pursuant to due call and notice thereof, a regular meeting of the Board of Commissioners of the
Economic Development Authority of the City of Elk River, Minnesota, was duly held in the City Hall in
the City of Elk River,on Tuesday,November 13,2012,commencing at 5:30 P.M.
The following Members were present:
and the following were absent:
Member introduced the following resolution and moved its adoption:
RESOLUTION NO.
RESOLUTION CALLING FOR A PUBLIC HEARING ON
THE ISSUANCE OF GENERAL OBLIGATION REFUNDING BONDS
AND AUTHORIZING THE PUBLICATION OF A NOTICE OF HEARING
WHEREAS, the Board of Commissioners of the Economic Development Authority of
the City of Elk River, Minnesota (the "Authority"), has determined that it can achieve debt service
cost savings and therefore it is necessary and desirable that the Authority issue its General Obligation
Refunding Bonds (the"Bonds")to refund in advance of maturity and at their redemption date the 2018
to 2033 maturities of the Authority's General Obligation Bonds, Series 2007B, dated November 8,
2007 (the "Refunded Bonds")the principal amount of$9,225,000 is callable on February 1, 2017; and
WHEREAS,before proceeding it is necessary for the Authority to hold a public hearing
on the proposal pursuant to the Act:
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the
Economic Development Authority of the City of Elk River, Minnesota, as follows:
1. A public hearing on the Bonds will be held at the time and place set forth in the
form of Notice of Public Hearing attached hereto as Exhibit A. The general nature of the facility to be
refinanced and an estimate of the aggregate principal amount of bonds or other obligations to be issued
to finance the proposal are described in the Notice of Public Hearing.
2. The Executive Director of the Authority is hereby authorized and directed to
cause notice of the hearing to be given one publication in the official newspaper of the Authority and a
newspaper of general circulation available in the City of Elk River, not less than 14 days nor more
than 30 days prior to the date fixed for the hearing, substantially in the form of the attached Notice of
Public Hearing.
413688v2 JSB EL185-21
The motion for the adoption of the foregoing resolution was duly seconded by member
, and after full discussion thereof and upon vote being taken thereon, the
following voted in favor thereof:
and the following voted against the same:
whereupon said resolution was declared duly passed and adopted.
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413688v2 JSB EL185-21
STATE OF MINNESOTA
COUNTY OF SHERBURNE
ECONOMIC DEVELOPMENT AUTHORITY
OF THE CITY OF ELK RIVER
I, the undersigned, being the duly qualified and acting Executive Director of the Economic
Development Authority of the City of Elk River, DO HEREBY CERTIFY that I have compared the
attached and foregoing extract of minutes with the original thereof on file in my office, and that the
same is a full, true and complete transcript of the minutes of a meeting of the Board of Commissioners
of the EDA was duly called and held on the date therein indicated, insofar as such minutes relate to
calling for a public hearing on the December 10, 2012.
WITNESS my hand this day of November, 2012.
Executive Director
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413688v2 JSB EL185-21
EXHIBIT A
NOTICE OF PUBLIC HEARING ON A PROPOSAL
FOR ISSUANCE OF GENERAL OBLIGATION REFUNDING BONDS
Notice is hereby given that a public hearing shall be conducted by the Board of Commissioners
of the Economic Development Authority of the City of Elk River, Minnesota (the "EDA") on Monday,
December 10, 2012 at 5:30 P.M. or as soon thereafter as the matter may be heard at the City Hall
located at 13065 Orono Parkway NW, Elk River, Minnesota, on a proposal that the EDA, in order to
achieve interest cost savings, refinance its General Obligation Bonds, Series 2007B, the proceeds of
which were used to finance the acquisition and betterment of an existing recreational facility located at
13337 Business Center Drive NW in Elk River (the "Project") by issuing refunding bonds or other
obligations in an amount not to exceed $ pursuant to Minnesota Statutes, Sections 469.102
and Chapter 475, as amended. The Project is owned by the EDA and leased to YMCA of the Greater
Twin Cities (formerly known as The Young Men's Christian Association of Metropolitan
Minneapolis).
At the time and place fixed for the public hearing, the EDA will give all persons who appear at
the hearing an opportunity to express their views with respect to the proposal. In addition, interested
persons may file written comments respecting the proposal with the Executive Director at or prior to
the public hearing.
A-1
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