4.1. & 4.2. SR 10-23-2000
r~1 -~)
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City of lY
Elk
Item # 4 . 1. & 4. 2.
MEMORANDUM
TO: Mayor & City Council
FROM: Lori Johnson, Finance Director
DATE: October 23, 2000
SUBJECT: Consider Resolutions Awarding The Sale Of The 2000A
Tax Increment Bond, 2000B Permanent Improvement
Revolving Fund Bond, 2000C Improvement Refunding
Bond, And 2000D Tax Increment Refunding Bond.
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The City Council previously authorized the issuance of four bond issues - two
to finance improvement projects and two refundings. Attached are parts of
the four resolutions to award the sale of the bonds. The four documents are
lengthy so only parts are being distributed; please contact city hall if you
would like a full set of the documents. Shelly Eldridge of Ehlers and
Associates will be at the meeting at 5:00 to present the bid results and
recommend the award. However, the resolutions awarding the bond issues
must be approved after 6:00 p.m. in accordance with published bond
documents.
The bond issues as presented in the awarding resolutions are exactly as
previously authorized with one exception: The 2000A issue has been reduced
to $800,000 and will finance only the TIF 19 portions of the street and storm
sewer improvements. If necessary, a State Aid Road bond will be issued in
2001 to finance the remaining portion of the project. The 2000A bond will be
paid entirely from tax increment, and if issued, the 2001 bond would be paid
entirely by municipal state aid funds.
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Also, the Economic Development Authority will be required to approve
resolutions pledging tax increment from districts 6, 7, and 19 to the
respective bond issues. These resolutions for the 2000A and 2000D bonds
will be presented to the EDA on November 13.
13065 Orono Parkway. P.O. Box 490. Elk River, MN 55330. TDD & Phone (763) 441-7420. Fax (763) 441-7425
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Finally, the city requested a rating from Moody's on these issues. Moody's
has confirmed the city's A3 rating, but has upgraded the outlook from stable
to positive. This is encouraging news that another upgrade may be coming if
current trends continue. Patrick Williams, the financial analyst who worked
on this rating, will be providing feedback on the areas in which the rating
committee would like to see improvement. We can then focus on those areas
in an effort to increase our rating.
Action Reauested
The Council is asked to consider the attached resolutions awarding the sale
of the 2000A Tax Increment Bond, 2000B Permanent Improvement Revolving
Fund Bond, 2000C Improvement Refunding Bond, and 2000D Tax Increment
Refunding Bond.
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CITY OF ELK RIVER
RESOLUTION NO.
RESOLUTION ACCEPTING OFFER TO PURCHASE THE
CITY'S $800,000 GENERAL OBLIGATION TAX INCREMENT BONDS,
SERIES 2000A AND PROVIDING FOR THEIR ISSUANCE
WHEREAS, it is hereby determined that the City should issue its $800,000 General
Obligation Tax Increment Bonds, Series 2000A, (the "Bonds"), to defray a portion of certain public
improvements (the "Improvements" or "Proj ect") to be incurred within and for the benefit ofthe Elk
River Economic Development Authority's (the "EDA") Tax Increment Financing District No. 19
pursuant to Minnesota Statutes, Chapters 469 and 475, as follows:
Estimated Total Project Costs
Allowance for Discount
Costs of Issuance
Capitalized Interest
$ 725,000
11,900
14,550
48,550
Net Bond Issue
$ 800,000
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk River
as follows:
1. Acceptance of Offer. Theofferof
(the "Purchaser"), to purchase the City's $800,000 General Obligation Tax Increment
Bonds, Series 2000A (the "Bonds", or individually a "Bond"), at the rates of interest
and upon the other terms set forth in this Resolution, and to pay therefor the sum of
$ plus interest accrued to settlement, is hereby accepted.
2. Title: Original Issue Date: Maturities: Denominations.
(a) Title and Maturities. The Bonds shall be titled "General Obligation Tax
Increment Bonds, Series 2000A," shall be dated November 1, 2000, as the
date of original issue, and shall be issued forthwith on or after such date as
fully registered bonds. The Bonds shall be numbered from R-1 upward in the
denomination of $5,000 each or in any integral multiple thereof of a single
maturity. The Bonds shall mature on February 1 in the years and amounts as
follows:
1217682.1
. Year Amount Year Amount
2003 $25,000 2010 $65,000
2004 50,000 2011 70,000
2005 50,000 2012 70,000
2006 55,000 2013 75,000
2007 55,000 2014 80,000
2008 60,000 2015 80,000
2009 65,000
As may be permitted in the offering of the Bonds and as may be requested by
the Purchaser, one or more term Bonds may be issued having mandatory
sinking fund redemption and final maturity amounts conforming to the
foregoing principal repayment schedule, and corresponding additions may be
made to the provisions of the applicable Bond(s).
(b)
Book Entry Only System. The Depository Trust Company, in New York,
N ew York, pursuant to a certain Blanket Issuer Letter of Representations to
be executed by the City and accepted by said Trust Company (as the same
may be supplemented or superseded, and including all provisions thereof and
rules, procedures or practices referenced therein, the "Letter of
Representations"), or any of its successors to its functions hereunder (the
"Depository"), will act as securities depository for the Bonds, and to this end:
.
(i) The Bonds shall be initially issued and, so long as they remain in
book entry form only (the "Book Entry Only Period"), shall at all
times be in the form of a separate single fully registered Bond for
each maturity of the Bonds; and authorized denominations for each
maturity of Bonds shall be deemed to be limited during the Book
Entry Only Period to the outstanding principal amount of that
maturity. While in such book entry form, the Bonds are sometimes
hereinafter referred to as being in "Book Entry Only Form."
(ii) Upon initial issuance, ownership of the Bonds shall be registered in
a bond register maintained by the Bond Registrar described in this
Resolution in the name of CEDE & CO., as the nominee (it or any
nominee of the existing or a successor Depository, the "Nominee").
(iii) With respect to the Bonds, neither the City nor the Bond Registrar
shall have any responsibility orobligation to any broker, dealer, bank,
or any other financial institution for which the Depository holds
Bonds as securities depository (the "Participant") or to the person for
which a Participant holds an interest in the Bonds shown on the books
.
1217682.1
2
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EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE CITY OF
ELK RIVER, MINNESOTA
Pursuant to due call and notice thereof, a regular or
special meeting of the City Council of the City of Elk River,
Minnesota, was duly held in the Elk River City Hall on October
23, 2000, commencing at approximately 6:00 P.M., C.T., in part
for the purpose of considering the offers which had been received
for the purchase of the City.s $1,275,000 General Obligation
Permanent Improvement Revolving Fund Bonds, Series 2000B.
The following Councilmembers were present:
and the following were absent:
***
***
***
There was then presented a tabulation of the offers
which had been received in the manner specified in the Terms of
Proposal for the Bonds. The offers were as follows:
1217813.1
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then introduced the
following Resolution and moved its adoption:
RESOLUTION NO.
RESOLUTION PROVIDING FOR THE
ISSUANCE AND SALE OF THE CITY'S
$1,275,000 GENERAL OBLIGATION
PERMANENT IMPROVEMENT REVOLVING FUND
BONDS, SERIES 2000B
BE IT RESOLVED by the City Council (the "Council") of
the City of Elk River, Minnesota (the "City"), as follows:
1. Recitals. It is hereby determined:
(a) The following assessable public improvements (the
"Improvements") have been duly ordered by the City and have
been constructed by the City or will be constructed under
contracts which the City has or will let therefor, all
pursuant to and in accordance with the applicable provisions
of Minnesota Statutes, Chapter 429:
Western Area Improvement project, Phase IV:
Project Costs
Allowance for Discount
Costs of Issuance
Less Other Funds
$1,717,442
19,100
16,389
(477.931)
$1,275,000
Net Bond Issue
(b) It is necessary and expedient to the sound
financial management of the affairs of the City that the
City issue its bonds pursuant to Minnesota Statutes,
Chapters 429 and 475, to provide financing for the
Improvements.
(c) The Improvements and all their components have
been ordered 'on or prior to the date hereof, after a hearing
thereon (except where not required bylaw) for which mailed
and published notice was duly given as required bylaw
describing the Improvements and all their components by
general nature, estimated cost, and area to be assessed.
(d) The Council desires that the Bonds be issued
initially in "Book Entry Only Form" (as hereinafter
described) .
2. Acceptance of Offer: Book Entrv Bonds.
(a) The offer of (the
"Purchaser") to purchase the City's $1,275,000 General
Obligation Permanent Improvement Revolving Fund Bonds,
1217813.1
2
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EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE CITY OF
ELK RIVER, MINNESOTA
Pursuant to due call and notice thereof, a regular or
special meeting of'the City Council of the City of Elk River,
Minnesota, was duly held in the Elk River City Hall on October
23, 2000, commencing at 6:00 P.M., C.T., in part for the purpose
of considering the offers which had been received for the
purchase of the City's $900,000 General Obligation Improvement
Refunding Bonds, Series 2000C.
The following Councilmembers were present:
and the following were absent:
***
***
***
There was then presented a tabulation of the offers
which had been received in the manner specified in the Terms of
Proposal for the Bonds. The offers were as follows:
1218477 .1
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then introduced the
following Resolution and moved its adoption:
RESOLUTION NO.
RESOLUTION PROVIDING FOR THE
ISSUANCE AND SALE OF THE CITY'S $900,000
GENERAL OBLIGATION IMPROVEMENT REFUNDING
BONDS, SERIES 2000C
WHEREAS, the City has received bids for the purchase of its
General Obligation Improvement Refunding Bonds, Series 2000C.
NOW, THEREFORE~ BE IT RESOLVED by the City Council (the
"Council") of the City of Elk River, Minnesota (the "City"), as
follows:
1. Findings. It is hereby determined:
(a) The City issued its $2,350,000 General Obligation
Improvement Bonds, Series 1992A, dated June 1, 1992 (the
"Prior Bonds"), to finance assessable public improvements
(the "Improvements") in the City.
(b) The Council believes it to be in the City's best
interest to consider a refunding of the Prior Bonds.
(c) The Prior Bonds are subject to prepayment on
February 1, 2001, at the option of the City at the
redemption price of par plus accrued interest.
(d) The refunding of the Prior Bonds which mature
after February 1, 2001, is consistent with covenants made
with.the holders thereof and is necessary and desirable for
and will result in the reduction of debt service cost to the
City.
(e) It is necessary and expedient to issue the City's
$900,000 General Obligation Improvement Refunding Bonds,
Series 2000C (the "Bonds"), to provide (together with other
available funds of the City to be used for such purposes)
moneys for a current refunding of the $1,075,000 of the
principal of the Prior Bonds maturing after February 1, 2001
(which Prior Bonds are sometimes referred to herein as the
"Refunded Bonds"). The necessary amount of the Bonds is
determined as follows:
Prior Bonds Refunded
Bond Discount Allowance
Issuance Expenses
Less Other Available Funds
Net Bond Issue
$1,075,000
9,900
10,550
(195.450)
$ 900,000
1218477.1
2
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(f) The Council desires that the Bonds be issued in
Book Entry Only Form, as hereinafter described.
2. Acceptance of Offer. The offer of
(the "Purchaser"), to purchase the City.s General Obligation
Improvement Refunding Bonds, Series 2000C, dated November I, 2000
(the "Bonds", or individually a "Bond"), at the rates of interest
and upon the other terms set forth in this Resolution, and 'to pay
therefor the sum of $ plus interest accrued to
settlement, is hereby accepted.
3. Title: Original Issue Date: Denominations: Maturities:
Book Entry Bonds.
(a) The Bonds shall be titled IIGeneral Obligation
Improvement Refunding Bonds, Series 2000C,II shall be dated
November I, 2000, as the date of original issue and shall be
issued forthwith on or after such date as fully registered
bonds. The Bonds shall be numbered from R-l upward in the
denomination of $5,000 each or in any integral multiple
thereof of a single maturity. The Bonds shall mature on
February 1 in the years and amounts as follows:
Year Amounts
2002 $125,000
. 2003 135,000
2004 135,000
2-005 130,000
2006 130,000
2007 125,000
2008 120,000
In lieu of the foregoing serial maturity schedule, at the
request of the Purchaser, one or more term Bonds may be
delivered having mandatory sinking fund redemptions
corresponding to the applicable amounts above.
(b) Book Entry Only System. The Depository Trust
Company, a limited purpose trust company organized under the
laws of the State of New York, or any of its successors to
its functions hereunder (the IIDepository"), will act as
securities depository for the Bonds, and to this end:
.
(i) The Bonds shall be initially issued and, so
long as they remain in book entry form only (the "Book
Entry Only periodll), shall at all times be in the form
of a separate single fully registered Bond for each
maturity of the Bonds; and authorized denominations for
each maturity of Bonds shall be deemed to be limited
during the Book Entry Only Period to the outstanding
principal amount of that maturity. While in such book
entry form, the Bonds are sometimes hereinafter
referred to as being in IIBook Entry Only Form. II
1218477.1
3
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CITY OF ELK RIVER
RESOLUTION NO.
RESOLUTION ACCEPTING OFFER TO PURCHASE THE
CITY'S $510,000 TAXABLE GENERAL OBLIGATION
TAX INCREM:ENT REFUNDING BONDS, SERIES 2000D
AND PROVIDING FOR THEm ISSUANCE
WHEREAS, the Council believes it to be in the City's best interest to consider a refunding
of (I) the City's General Obligation Taxable Tax Increment Bonds, Series 1989B, dated November
1, 1989 (the "1989B Bonds"), issued in the original principal amountof$41 0,000 and (2) the City's
General Obligation Taxable Tax Increment Bonds, Series 1990A, dated April 1 , 1990 (the "1990A
Bonds") issued in the original principal amount of $400,000, and the 1989B Bonds and the 1990A
Bonds are sometimes collectively referred to herein as the "Prior Bonds"; and
'VHEREAS, the outstanding Prior Bonds which mature after February 1, 2001, being in the
aggregate principal amount of$500,000, are subject to prepayment on said date at the option of the
City at the redemption price of par plus accrued interest; and
WHEREAS, the above-described refunding of the callable Prior Bonds is consistent with.
covenants made with the holders thereof and is necessary and desirable for and will result in the
. reduction of debt service cost to the City; and
'VHEREAS, it is necessary and expedient to issue the $510,000 City's Taxable General
Obligation Tax Increment Refunding Bonds, Series 2000D (the "Bonds"), to provide moneys for a
refunding of the Prior Bonds which mature after February 1, 200 1 (which Prior Bonds to b~ refunded
are referred to herein as the "Refunded Bonds"):
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of ElkRiver
as follows:
1. Acceptance of Offer. The offer of
(the "Purchaser"), to purchase the City's Taxable General Obligation Tax Increment
Refunding Bonds, Series 2000D (the "Bonds", or individually a "Bond "), at the .rates
of interest and upon the other terms set forth in this Resolution, and to pay therefor .
the sum of $ plus interest accrued to settlement, is hereby
accepted.
2. Title: Original Issue Date: Maturities: Denominations.
(a) Title and Maturities. The Bonds shall be titled "Taxable General Obligation
Tax Increment Refunding Bonds, Series 2000D," shall be dated November
.
1218143.1
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1218143.1
1, 2000, as the date of original issue, and shall be issued forthwith on or after
such date as fully registered bonds. The Bonds shall be numbered from R-l
upward in the denomination of$5,000 each orin any integral multiple thereof
of a single maturity. The Bonds shall mature on February 1 in the years and
amounts as follows:
As may be permitted in the offering of the Bonds and as may be
requested by the Purchaser, one or more term Bonds may be issued having
mandatory sinking fund redemption and final maturity amounts conforming
to the foregoing principal repayment schedule, and corresponding additions
may be made to the provisions of the applicable Bond(s).
The principal amounts of the Bonds are hereby allocated between the
portion thereof issued to refund the 1989B Bonds (the "1989B Refunding
Bonds") and the portion thereof issued to refund the 1990A Bonds (the
"1990A Refunding Bonds"), respectively, as follows: '
Year
Amount
1989B Refunding
Bonds
1990A Refunding
Bonds
2002
2003
2004
2005
2006
2007
2008
2009
2010
$50,000
60,000
65,000
75,000
70,000
80,000
35,000
40,000
35.000
$510,000
$30,000
30,000
35,000
45,000
40,000
45,000
$20,000
30,000
30,000
30,000
30,000
35,000
35,000
40,000
35,000
$285,000
$225,000
(b) Book Entry Only System. The Depository Trust Company, in New York,
New York, pursuant to a certain Blanket Issuer Letter of Representations to
be executed by the City and accepted by said Trust Company (as the same
may be supplemented or superseded, and including all provisions thereof and
2
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City of Elk River
Results of BOnd Sale
October 23, 2000
$800,000
G..O. Tax Increment Bonds, Series2000A
Low Bidder
True Interest Rate
Number of Bids
Range of Bids
Rating Moody's U A3" with positive outlook
Council Action Adopt 1/ A Resolution AcceptingOffer to Purchase the City's
$800,000 General Obligation Tax Increment Bonds, Series 2000A,
and Providing For Their Issuance"
Awards sale to low hii/..
Attachments
. Bid Tabulation
· Revised Debt Service Analysis
EHLERS
& ASSOCIATES INC
l EA 0 E R SIN PUB lie F I riA Nt;E
3060 Centre Pointe Drive, Roseville, MN 55113.1105
651.697.8500 fax651.697.8555 www.ehletll';Rc.ClHD
Offices in Roseville, MH, I3rot>kfJIi/./d,WI.'lId Naperv/lle, It
"-~j
.
BID TABULATION
$800,000 General Obligation Tax Increment Bonds, Series 2000A
City of Elk River, MN
SALE: October 2S, 2000
AWARD: DAIN RAUSCHER, INC.
RATING: Moody's Investors Service "AS"
BBI: 5.56%
NAME OF BIDDER
RATE YEAR
4.45% 2003
4.50% 2004
4.55% 2005
4.60% 2006
4.70% 2007
4.75% 2008
4.80% 2009
4.85% 2010
4.95% 2011
5.00% 2012
5.10% 2013
5.20% 2014
5.30% 2015
4.75% 2003-2007
5.00% 2008-2011
5.10% 2012
5.20% 2013-2014
5.25% 2015
PRICE
NET
INTEREST
COST
TRUE
INTEREST
RATE
DAIN RAUSCHER, INC.
Minneapolis, MN
$788,822.50
$372,951.25
5.1632%
.
CRONIN & COMPANY, INC.
Minneapolis, MN
PAINEWEBBER INC.
Chicago, IL
MORGAN STANLEY DEAN WITTER
Chicago, IL
SALOMON SMITH BARNEY
Chicago, IL
CIBC WORLD MARKETS
New York, NY
$791,546.75
$376,388.88
5.2048%
.
e
& ASSOCIATES INC
LEADERS IN PUBLIC FINANCE
3060 Centre Pointe Drive, Roseville, MN 55113-1105
651.697.8500 fax 651.697.8555 www.ehlers-inc.com
Offices in Roseville, MN, Brookfield, WI and Naperville, IL
EHLERS
$800,000 General Obligation Tax Increment Bonds, Series 2000A
City of Elk River, MN
NAME OF BIDDER
RATE YEAR
PRICE
5.2093%
MillER, JOHNSON & KUEHN, INC.
Minneapolis, MN
4.45% 2003
4.50% 2004
4.55% 2005
4.60% 2006
4.65% 2007
4.70% 2008
4.80% 2009
4.90% 2010
5.00% 2011
5.10% 2012
5.15% 2013
5.25% 2014
5.35% 2015
$788,160.00
NET
INTEREST
COST
$376,230.63
page.
TRUE
INTEREST
RATE
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FINAL - Results of Sale
City of Elk River
$800,000 G.O. Tax Increment Bonds, Series 2000A
Tax
Date Principal Rate Interest P&I Increment
2/112001
211/2002 0 0.000% 48,831.25 48,831.25 0
2/1/2003 25,000 4.450% 39,065.00 64,065.00 64,000
211/2004 50,000 4.500% 37,952.50 87,952.50 88,000
2/112005 50,000 4.550% 35,702.50 85,702.50 86,000
2/1/2006 55,000 4.600% 33,427.50 88,427.50 88,000
211/2007 55,000 4.700% 30,897.50 85,897.50 86,000
211/2008 60,000 4.750% 28,312.50 88,312.50 88,000
211/2009 65,000 4.800% 25,462.50 90,462.50 90,000
2/112010 65,000 4.850% 22,342.50 87,342.50 87,000
211/2011 70,000 4.950% 19,190.00 89,190.00 89,000
2/112012 70,000 5.000% 15,725.00 85,725.00 86,000
211/2013 75,000 5.100% 12,225.00 87,225.00 87,000
2/112014 80,000 5.200% 8,400.00 88,400.00 88,000
2/112015 80,000 5.300% 4,240.00 84,240.00 84,000
TOTAL 800,000 361,773.75 1,161,773.75 1, 111 ,000
Dated
Delivery Date
First Coupon Date
Bond Year Dollars
Average Life
Average Coupon
Net Interest Cost (NIC)
True Interest Cost (TIC)
Ehlers & Associates, Inc.
.
Capitalized
Interest
48,550
48,550
11/01/2000
11/01/2000
8/01/2001
$7,260.00
9.075 Years
4.98311 %
5.13707%
5.16320%
10/23/2000
[Goti2000]
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e
City of E.lk River
Results of Bond Sale
October 23, 2000
$1,275,000
G.O. Permanent Improvement Revolving Fund Bonds, Series 2000B
Low Bidder
DainRauscher
True Interest Rate
5.1672%
Number of Bids
3
5.1672% to 5.2286%
Range.ofBids
Rating
Moody's "A3" withpositiv~outlook
Council Action Adopt II Resolution Providing for the Issuance and Sale of the
City' s$1,275,OOO G.O. Permanent Improvement Revolving Fund
Bonds, Series 2000B"
Awards sale to low bid.
Attachments
. Bid Tabulation.
· Revised Debt Service Analysis
EHLERS
lEA 0 E R SIN. P U & L I C FIN ANC E
3060 CentrePointe Orlve, Roseville,MN 55113.n 05
651.697.8500 fax 651.697.8555 www.ehlers-inCA;ottl
Offices in Rosevilhl, UN, BroOkfield, WI and Naperville, It
& ASSOCIATES INC
BID TABULATION
. $1,275,000 General Obligation Permanent Improvement Revolving Fund Bonds, Series 2000B
City of Elk River, MN
SALE: October 23, 2000
AWARD: DAIN RAUSCHER, INC.
RATING: Moody's Investors Service" A3"
BBI: 5.56%
NAME OF BIDDER
RATE YEAR
4.40% 2002
4.45% 2003
4.50% 2004
4.55% 2005
4.60% 2006
4.70% 2007
4.75% 2008
4.80% 2009
4.85% 2010
4.95% 2011
5.00% 2012
5.10% 2013
5.20% 2014
5.30% 2015
5.40% 2016
4.75% 2002-2007
4.80% 2008
5.00% 2009-2011
5.10% 2012
5.15% 2013
5.20% 2014
5.25% 2015
5.30% 2016
PRICE
NET
INTEREST
COST
TRUE
INTEREST
RATE
DAIN RAUSCHER, INC.
Minneapolis, MN
$1,258,839.38
$541,577.49
5.1672%
.
CRONIN & COMPANY, INC.
Minneapolis, MN
PAINEWEBBER INC.
Chicago,IL
MORGAN STANLEY DEAN WITTER
Chicago,IL
SALOMON SMITH BARNEY
Chicago, IL
CIBC WORLD MARKETS
New York, NY
$1,261,352.40
$545,258.85
5.2030%
.
e
& ASSOCIATES INC
LEADERS IN PUBLIC FINANCE
3060 Centre Pointe Drive, Roseville, MN 55113-1105
651.697.8500 fax 651.697.8555 www.ehlers-inc.com
Offices in Rosevi/le, MN, Brookfield, WI and Napervi/le, IL
EHLERS
$1,275,000 General Obligation Permanent Improvement Revolving Fund Bonds, Series 2000B
City of Elk River, MN
NAME OF BIDDER
RATE YEAR
PRICE
5.2286%
MILLER, JOHNSON & KUEHN, INC.
Minneapolis, MN
BERNARDI SECURITIES, INC.
Chicago, IL
4.40% 2002
4.45% 2003
4.50% 2004
4.55% 2005
4.60% 2006
4.65% 2007
4.70% 2008
4.80% 2009
4.90% 2010
5.00% 2011
5.10% 2012
5.15% 2013
5.25% 2014
5.35% 2015
5.40% 2016
$1,256,002.50
NET
INTEREST
COST
$547,315.00
Page ~
TRUE
INTEREST
RATE
.
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FINAL - Results of Sale
.
City of Elk River
$1,275,000 G.O. Permanent Improvement Revolving Fund Bonds, Series 2000B
Assessment Surplus/ Cumulative
Date Principal Rate Interest P&I Revenue (Deficit) Balance
2/1/2001
2/1/2002 85,000 4.400% 77 ,084.38 162,084.38 337,640 175,556 175,556
2/1/2003 85,000 4.450% 57,927.50 142,927.50 204,704 61,776 237,332
2/1/2004 85,000 4.500% 54,145.00 139,145.00 197,738 58,593 295,925
2/1/2005 85,000 4.550% 50,320.00 135,320.00 190,771 55,451 351,376
2/1/2006 85,000 4.600% 46,452.50 131,452.50 183,805 52,352 403,728
2/1/2007 85,000 4.700% 42,542.50 127,542.50 176,838 49,296 453,024
2/1/2008 85,000 4.750% 38,547.50 123,547.50 169,872 46,325 499,349
2/1/2009 85,000 4.800% 34,510.00 119,510.00 162,906 43,396 542,744
2/1/2010 85,000 4.850% 30,430.00 115,430.00 155,939 40,509 583,254
2/1/2011 85,000 4.950% 26,307.50 111,307.50 148,973 37,665 620,919
2/1/2012 85,000 5.000% 22,100.00 107,100.00 142,007 34,907 655,826
2/1/2013 85,000 5.100% 17,850.00 102,850.00 135,040 32,190 688,016
2/1/2014 85,000 5.200% 13,515.00 98,515.00 128,074 29,559 717,575
2/1/2015 85,000 5.300% 9,095.00 94,095.00 121,108 27,013 744,587
2/1/2016 85,000 5.400% 4,590.00 89,590.00 114,141 24,551 769,139
TOTAL 1,275,000 525,416.88 1,800,416.88
Dated 11/01/2000 Assessment Term 15.00
Delivery Date 11/01/2000 Assessment Rate 6.50%
First Coupon Date 8/01/2001 Total Assessed 1,733,592
Bond Year Dollars $10,518.75 Total Project 1,717,442
Average Life 8.250 Years MnDOT (329,467)
Average Coupon 4.99505% MSA (148,464)
Net Interest Cost (NIC) 5.14869% Finance 35,489
True Interest Cost (TIC) 5.16724% Capitalized Interest 0
Total Issue 1,275,000
Ehlers & Associates, Inc. 10/23/2000 [GOPIR2000]
.
.
.
e
City of Elk River
Results of Bond Sale
October 23, 2000
$900,000
G.O. Improvement Refunding Bonds, Series 2000C
Low Bidder
Tme Interest Rate
4.8835%
3
4.8835% to 4.9439%
Number of Bids
Range of Bids
Rating Moody's /I A3" with positive outlook
Council Action Adopt II Resolution Providing for the Issuance and Sale of the
City's $900,OOOG.O. Improvement Refunding Bonds,5eries
2000c"
Awards sale to low bid.
Attachments
. Bid Tabulation
· Revised Debt Servke Analysis
EHLERS
lE AD. E RS ,. N PUB l I C 1" NAN CE
3060 Centre Pointe Drive, Roseville, MN 55113.1l05
651.691.8500 fax 651.697.8555 www.ehlers.inc.C(lm
Offices in RO$eville, IAN,Brookfield, WI and Naperville, It.
& ASSOCIATES INC
BID TABULATION
.
$900,000 General Obligation Improvement Refunding Bonds, Series 2000C
City of Elk River, Minnesota
SALE: October 23, 2000
AWARD: U. S. BANCORP PIPER JAFFRAY
RATING: Moody's Investors Service lA3"
BBI: 5.56%
NET TRUE
NAME OF BIDDER RATE YEAR PRICE INTEREST INTEREST
COST RATE
U. S. BANCORP PIPER JAFFRA Y* 4.40% 2002 $890,100.00 $183,787.50 4.8835%
Minneapolis, Minnesota 4.45% 2003
4.50% 2004
4.55% 2005
4.60% 2006
4.65% 2007
4.70% 2008
"ER' JOHNSON, KUEHN, INC.* 4.40% 2002 $890,100.00 $183,787.50 4.8835%
Inneapolis, Minnesota 4.45% 2003
4.50% 2004
4.55% 2005
4.60% 2006
4.65% 2007
4.70% 2008
DAIN RAUSCHER, INC. 4.50% 2002-2004 $890,174.60 $185,293.53 4.9232%
Minneapolis, Minnesota 4.60% 2005
4.625% 2006
4.70% 2007
4.75% 2008
*Tie bids - U.S. Bancorp Piper Jaffray was awarded the sale by lot
.
e
& ASSOCIATES INC
LEADERS IN PUBLIC FINANCE
3060 Centre Pointe Drive, Roseville, MN 55113-1105
651.697.8500 fax 651.697.8555 www.ehlers-inc.com
Offices in Roseville, MN, Brookfield, WI and Napervi/le, IL
EHLERS
$900,000 General Obligation Improvement Refunding Bonds, Series 2000C
City of Elk River, Minnesota
NAME OF BIDDER
RATE
p.
YEAR
NET
INTEREST
COST
TRUE
INTEREST
RATE
CRONIN & COMPANY, INC.
Minneapolis, Minnesota
PAINEWEBBER, INC.
Chicago, Illinois
MORGAN STANLEY DEAN WITTER
Chicago, Illinois
SALOMON SMITH BARNEY
Chicago, Illinois
CIBC WORLD MARKETS
New York
4.50%
4.55%
4.60%
4.65%
4.70%
4.75%
4.80%
PRICE
2002
2003
2004
2005
2006
2007
2008
$891,421.15
$186,251.35
4.9439%
.
.
.
.
.
FINAL - Results of Sale
City of Elk River
$900,000 G.O. Improvement Refunding Bonds, Series 2000C
Existing
Date Principal Rate Interest P&I Debt Savings
2/1/2001
211/2002 125,000 4.400% 51,162.50 176,162.50 216,360 40, 198
211/2003 135,000 4.450% 35,430.00 170,430.00 207,510 37,080
2/1/2004 135,000 4.500% 29,422.50 164,422.50 203,360 38,938
211/2005 130,000 4.550% 23,347.50 153,347.50 193,750 40,403
211/2006 130,000 4.600% 17,432.50 147,432.50 184,063 36,630
2/1/2007 125,000 4.650% 11,452.50 136,452.50 174,375 37,923
2/1/2008 120,000 4.700% 5,640.00 125,640.00 164,688 39,048
TOTAL 900,000 173,887.50 1,073,887.50
Dated 11/01/2000
Delivery Date 11/0112000
First Coupon Date 8/0112001
Bond Year Dollars $3,785.00 Total savings 270,217.50
Average Life 4.206 Years Present value of savings 219,928.59
Average Coupon 4.59412% City cash contribution (181,406.62)
Net Interest Cost (NIC) 4.85568%
True Interest Cost (TIC) 4.88358%
Net present value savings $40,227.39
% of refunded principal 3.74%
% of refunding principal 4.47%
Ehlers & Associates, Inc.
10/23/2000
[lmpRefund]
.
.
.
e
City of Elk River
Results of Bond Sale
October 23, 2000
$510,000
Taxable G.O. Tax Increment Refunding Bonds, Series 20000
Low Bidder
Miller, Johnson& Kuehn
7.3794 %
True Interest Rate
Number of Bids
4 {r
Range of Bids
7.3794 % to 7.6957%
Rating Moody's" A311with positive outlook; ..
Council Action Adopt" Resolution Providing for the Issuance andSale of the
Citt s $510,000 Taxable G.O. Tax Increment Refunding Bonds,
Series 2OOOD"
Awards sale to low bid.
Attachments
. Bid Tabulation
· Revised Debt Service Analysis
EHLERS
lEADERS IN pue llCf: I 'ILA ,.,C E
30.60 Centre PotnteDrive, Rosevifle, MN .5S1U-HOS
651.697.8500. fax 651.697.8555 www.el1ler$-inc;,c;om
Offlc.,s In RoseviUl!I,MN, Brj)fjkfield, WI 3ndf!lapf;ii'V/IIe, It
& ASSOCIATES INC
BID TABULATION
.
$510,000 Taxable General Obligation Tax Increment Refunding Bonds, Series 2000D
City of Elk River, MN
SALE: October 23,2000
AWARD: MILLER, JOHNSON & KUEHN, INC.
RATING: Moody's Investors Service "A3"
BBI: 5.56%
NAME OF BIDDER
RATE YEAR
6.70% 2002
6.80% 2003
6.90% 2004
6.95% 2005
7.00% 2006
7.10% 2007
7.20% 2008
7.30% 2009
7.40% 2010
7.00% 2002
7.05% 2003-2005
7.10% 2006
7.15% 2007-2010
7.20% 2002-2007
7.25% 2008-2010
PRICE
NET
INTEREST
COST
TRUE
INTEREST
RATE
MillER, JOHNSON & KUEHN, INC.
Minneapolis, MN
$503,880.00
$183,759.37
7.3794%
.NARDI SECURITIES, INC.
icago, Il
$503,916.40
$184,069.85
7.4018%
CRONIN & COMPANY, INC.
Minneapolis, MN
PAINEWEBBER INC.
Chicago, Il
MORGAN STANLEY DEAN WITTER
Chicago,ll
SALOMON SMITH BARNEY
Chicago, Il
CIBC WORLD MARKETS
New York, NY
$504,734.40
$185,899.35
7.4685%
U.S. BANCORP PIPER JAFFRAY
Chicago, Il
7.40%
2002-2010
$503.882.60
$191.302.40
7.6957%
.
e
& ASSOCIATES INC
LEADERS IN PUBLIC FINANCE
3060 Centre Pointe Drive, Roseville, MN 55113-1105
651.697.8500 fax 651.697.8555 www.ehlers-inc.com
Offices in Roseville, MN, Brookfield, WI and Naperville, IL
EHLERS
.
.
.
FINAL - Results of Sale
City of Elk River
$510,000 Taxable Tax Increment Refunding Bonds, Series 20000
Existing
Date Principal Rate Interest P&I Debt Savings
2/1/2001
2/1/2002 50,000 6.700% 44,671.88 94,671.88 97,807 3,136
2/1/2003 60,000 6.800% 32,387.50 92,387.50 98,127 5,740
2/1/2004 65,000 6.900% 28,307.50 93,307.50 97,952 4,645
2/1/2005 75,000 6.950% 23,822.50 98,822.50 102,290 3,467
2/1/2006 70,000 7.000% 18,610.00 88,610.00 95,660 7,050
2/1/2007 80,000 7.100% 13,710.00 93,710.00 99,000 5,290
2/1/2008 35,000 7.200% 8,030.00 43,030.00 46,385 3,355
2/1/2009 40,000 7.300% 5,510.00 45,510.00 47,920 2,410
2/1/2010 35,000 7.400% 2,590.00 37,590.00 43,960 6,370
TOTAL 510,000 177 ,639.38 687,639.38
Dated 11/01/2000
Delivery Date 11/01/2000
First Coupon Date 8/01/2001
Bond Year Dollars $2,502.50 Total savings 41,463.12
Average Life 4.907 Years Present value of savings 28,809.12
Average Coupon 7.09848% Accrued interest 1,489.06
Net Interest Cost (NIC) 7.34303% Net present value savings $30,298.18
True Interest Cost (TIC) 7.37946% % of refunded principal 6.06%
% of refunding principal 5.94%
Ehlers & Associates, Inc.
10/23/2000
[TIFRefund]
.
.
.
New Issue: Elk River (City of) MN
Page 1 of3
Mood}'sResearch.com I !-fome
Moody's In1fesfo~s Service
G/aba/Credlt R~h
Municipal Credit Research
New Issue
Published 18 Oct 2000
Elk River (City of) MN
Contacts
Patrick Williams
Dianne Golub
212-553-4940
212-553-0566
Moody's Rating
Issue Rating
General Obligation Tax Increment Bonds, Series 2000A A3
Sale Amount $800,000
Expected Sale Date 10/23/00
Rating Description General Obligation Unlimited Tax
G.O. Permanent Improvement Revolving Fund Bonds, Series 2000B A3
Sale Amount $1,275,000
Expected Sale Date 10/23/00
Rating Description General Obligation Unlimited Tax
General Obligation Improvement Refunding Bonds, Series 2000C A3
Sale Amount $900,000
Expected Sale Date 10/23/00
Rating Description General Obligation Unlimited Tax
Taxable General Obligation Tax Increment Refunding Bonds, Series 2000D A3
Sale Amount $510,000
Expected Sale Date 10/23/00
Rating Description General Obligation Unlimited Tax
MOODY'S ASSIGNS A3 TO ELK RIVER (MN) G.O. BONDS, SERIES 2000A, 2000B, 2000C, AND 20000
$21.99 MILLION OF DEBT AFFECTED
Opinion
Moody's has assigned an A3 rating and positive outlook to Elk River's, (MN) $800,000 General Obligation Tax
Increment Bonds, Series 2000A, $1.275 million G.O. Permanent Improvement Revolving Fund Bonds, Series
2000B, $900,000 General Obligation Improvement Refunding Bonds, Series 2000C, and Taxable General
Obligation Tax Increment Refunding Bonds, Series 2000D. The rating is based on the city's diversifying and
growing tax base, strong financial position evidenced by growing reserves, and high, yet manageable, debt
burden. All series of bonds carry an unlimited tax general obligation pledge of the city. Proceeds from Series A
will be used to finance the East Elk River Improvement project. Series B proceeds will finance water and sewer
infrastructure improvements along with the extension of an existing parkway. Proceeds from both series C and
D will be used to refund portions of the city's outstanding general obligations.
RAPIDLY GROWING CITY BENEFITS FROM PRIME LOCATION
Moody's expects continued tax base growth for the city due to its favorable location in the high growth corridor
between Minneapolis (rated Aaa)/St. Paul (rated Aa2) metro area and St. Cloud (rated A 1). Growth of this $883
million tax base has been rapid, averaging 10.4% annually over the last five years, reflective of a growing
population which has increased over 48% since 1990. Housing development, which has averaged
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New Issue: Elk River (City of) MN
Page 2.of3 _
approximately 200 new homes per year over the last four years, is expected to continue at a similar rate.
Moody's expects the taxbase to continue to grow as the city undergoes significant development, including the
new tax increment district 19, which contains a Wal-mart, Home Depot, and a business park, among other
entities. In addition, growth in other parts of the city includes two additional business parks, and a light industrial .
manufacturing plant. This growth is expected to be aided by the future development of a commuter rail system
connecting the metro area to St. Cloud. The rail system is currently in the planning stages and is expected to be
completed within the next few years. With a station planned for Elk River, the commuting time to the metro area
would be approximately 45 minutes and the station would be multi-modal, offering both rail and bus services.
Wealth and housing values are above the state levels and ample employment opportunities are reflected in low
Sherburne County unemployment rates, which at 2.2% in August 2000 were below state levels.
FINANCIAL POSITION EXPECTED TO REMAIN STRONG
Moody's expects the city's financial position to remain satisfactory due to prudent fiscal management. In fiscal
year 1999. the General Fund balance was $2.3 million, equivalent to 43.2% of General Fund revenues, and
provided satisfactory liquidity and financial cushion. Except for flat General Fund reserve balances in 1998 due
to a planned transfer of funds for economic development, the city has grown the General Fund every year since
1990. Officials also anticipate an operating surplus for fiscal year 2000. This growth in fund balance is expected
to continue as the city has shown a propensity for conservative budgeting over the last several years.
HIGH DEBT BURDEN REFLECTS GROWTH NEEDS
Moody's expects the city's high debt burden of 5.9% to moderate due to the anticipation of future tax base
growth, rapid amortization of principal, approximately 79% over ten years, and minimal future borrowing needs.
The city's direct debt is moderate at 2.6%. Similar to many rapidly developing cities, a significant portion of the
city's debt (almost 49%) is backed by special assessments on affected property. Future debt issuance of $1
million is likely in fiscal 2001 for road improvements and an additional $1 million may also be issued in 2002 or
2003 for street improvements, dependent upon the outcome of a comprehensive financial planning process that
is about to be undertaken by the city.
KEY STATISTICS
2000 estimated population: 16,542
1999 full valuation: $883 million
.
1999 full value per capita: $53,408
Debt burden: 5.9%
Payout of principal (10 years): 79%
Unemployment (Sherburne County, 8/00): 2.2%
FY99 General Fund balance: $2.26 million (43.2% of General Fund revenues)
Outlook
The A3 rating has a positive outlook, reflecting the city's strong tax base growth, solid financial position. as well
as Moody's expectation that debt burden will remain moderate due to lack of significant future borrowing plans
by the city. In addition, the outlook is based on the expectation that the city will continue to achieve favorable
operating results and maintain healthy fund balances.
@ Copyright 2000 by Moody's Investors Service, 99 Church Street, New York, NY 10007. All rights reserved.
ALL INFORMATION CONTAINED HEREIN IS COPYRIGHTED IN THE NAME OF MOODY'S INVESTORS SERVICE, INC.
("MOODY'S"), AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED,
FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR
SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY
MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. All information contained
herein is obtained by MOODY'S from sources believed by it to be accurate and reliable. Because of the possibility of human or
mechanical error as well as other factors, however, such information is provided "as is" without warranty of any kind and
MOODY'S, in particular, makes no representation or warranty, express or implied, as to the accuracy, timeliness,
completeness, merchantability or fitness for any particular purpose of any such information. Under no circumstances shall
.
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