7.3. SR 04-06-2009~~/
City of
Elk -~
River
REQUEST FOR ACTION
To Item Number
Ci Council 7.3,
Agenda Section Meeting Date Prepared by
Administration Aril 6, 2009 Tim Simon, Finance Director
Item Description Reviewed by
Resolution Requesting Action of the Board of Commissioners Lori ohnson, Ci Administrator
of the Elk River Economic Development Authority, Minnesota Reviewed by
Calling for Redemption of Certain Outstanding Bonds.
Action Requested
The approval of a resolution requesting action of the Board of Commissioners of the Elk River
Economic Development Authority, Minnesota calling for redemption of certain outstanding bonds.
Background/Discussion
After every tax settlement and bond payment the Finance Department reviews the various debt service
funds and outstanding bond issues to determine if sufficient cash exists to pay-off any outstanding bonds
assuming they have reached their callable date.
On November 1, 1991, the City and EDA issued $2,740,000 in City Hall and Law Enforcement Facility
Revenue Bonds. Subsequently on December 1, 1997, the City and EDA refunded the bonds with a final
maturity of February 1, 2011. The bonds have been financed internally thru the NSP fund, Government
Buildings Fund, General Fund, and Liquor Store Fund. Sufficient funds exist with the remaining
amounts internally financed and. the irrevocable deposit with the escrow agent ($234,155 as of 12/31 /08)
to call the remaining outstanding principal plus accrued interest to June 1, 2009. The deposit with the
escrow agent (US Bank) will be released and applied against the final payment.
Financial Impact
Prepaying the bonds would result in a savings of approximately $27,000 less a small amount of accrued
interest. The amount to be paid on June 1, 2009 is $410,000 outstanding principal plus accrued interest.
Attachments
• Resolution Requesting Action of the Board of Commissioners of the Elk River Economic
Development Authority, Minnesota Calling for Redemption of Certain Outstanding Bonds
Action Motion by Second by Vote
Follow Up
C:\Documents and Settings\jjohnson\Local Settings\Temporary Internet Files\OLK49\calling1997bonds.doc
EXTRACT OF MINUTES OF A MEETING
OF THE CITY COUNCIL OF THE
CITY OF ELK RIVER, MINNESOTA
HELD: April 6, 2009
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 called and held at the City Hall in said City on
Apri16, 2009, at o'clock P.M.
The following members were present:
and the following were absent:
Member introduced the following resolution and moved its adoption:
RESOLUTION 09- REQUESTING ACTION OF THE BOARD OF
COMMISSIONERS OF THE ELK RIVER ECONOMIC DEVELOPMENT
AUTHORITY, MINNESOTA CALLING FOR REDEMPTION
OF CERTAIN OUTSTANDING BONDS
BE IT RESOLVED by the City Council of the City of Elk River, Minnesota (the "City"),
as follows:
A. WHEREAS, the Board of Commissioners of the Elk River Economic
Development Authority, Minnesota (the "Authority") issued on behalf of the City $2,290,000
City Hall and Law Enforcement Facility Revenue Refunding Bonds, (City of Elk River, Lease
Purchase Obligation), Series 1997 dated December 1, 1997 (the "Bonds"), of which $410,000
remain outstanding; and
B. WHEREAS, all of the said Bonds maturing in the years 2010 and thereafter, are
subject to redemption and prepayment at the option of the Authority on any date, at par and
accrued interest; and
C. WHEREAS, on April 13, 2009, the Authority will consider a resolution calling
for the redemption of the 2010 and 2011 maturities of the Bonds, inclusive, totaling $410,000 in
principal amount, on or about June 1, 2009; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk River,
Minnesota (the "City"), as follows:
1. The City Council hereby approves the redemption and prepayment of the Bonds
by the Authority maturing in the years 2010 and 2011, inclusive, on or about June 1, 2009 at par
and accrued interest for each such Bond called.
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2. The City Council hereby exercises the option to terminate the Lease pursuant to
Section 10.01 of the Lease Purchase Agreement between the authority and the City, dated as of
November 1, 1991 as amended by the Supplement to Lease Purchase Agreement dated as of
December 1, 1997.
3. The City Finance Director shall deposit $ in the Debt Service Account of
the Bond Fund for the Bonds and the Mayor and City Administrator are authorized and directed
to take such additional action on behalf of the City as is necessary to complete the prepayment of
the Bonds.
The motion for the adoption of the foregoing resolution was seconded by member
and upon a vote being taken thereon, the following voted in favor
thereof:
and the following voted against the same:
ATTEST:
Tina Allard, Ciry Clerk
Whereupon the resolution was declared duly passed and adopted.
Stephanie Klinzing, Mayor
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STATE OF MINNESOTA
COUNTY OF SHERBURNE
CITY OF ELK RIVER
I, the undersigned, being the duly qualified and acting Clerk of the City of Elk River,
Minnesota, DO HEREBY CERTIFY that I have carefully compared the attached and foregoing
extract of minutes of a meeting of the City Council, held on the date therein indicated, with the
original thereof on file and of record in my office and that the same is a full, true and complete
transcript insofar as the same relates to the resolution concurring in the action of the Elk River
Economic Development Authority, Minnesota
WITNESS my hand on April _, 2009.
Clerk
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