CCP 02-09-1998 - Laserfiche WebLink

Home Browse Search

DRAFT ARDEN HILLS CITY COUNCIL - JANUARY 26 1998 3 . Mayor Probst stated he understands, based on earlier conversations of today, that staff has rerun the numbers to verify that the debt service will be covered with the anticipated value of the tax revenue. Mr. Fritsinger advised that Ehlers and Associates, Inc. did recalculate the numbers and have indicated, should the City decide to make changes in the administrative fee and other items, the project will cash flow. Ehlers did add that all indications from the Capitol are that there is a great deal of support to change to a 3.5% C/I rate and that the suggested change to the 3% target has not been as well received from the Legislature. In terms of actual acceptance of the sale of bonds, Mayor Probst asked if there is one more action prior to it being finalized. Mr. Fritsinger stated there is potentially one more action to take on February 9, 1998 by the EDA prior to moving forward with closing. Councilmember Hicks asked if the City will be protected if approval is made subject to successful closing of the development agreement. Mr. Fritsinger stated this is correct and the City still has the opportunity to postpone the bond sale, if desired. Councilmember Aplikowski inquired what will happen to recover costs if the development agreement is not signed. Mr. Fritsinger explained it will be paid, over time, through the TIF generated on the Phase I building that is already constructed. . Mr. Post eXplained if the commercial property class rate drops to 3%, bonded debt service still could be handled through TIF tax revenue; but the debt to pay the PIR fund through TIF for soil correction costs would not be able to be repaid 100%. Mr. Post stated he believes the assumptions used for property valuation are extremely conservative and, with a more advantageous interest rate than in the projection, it should be enough to cover both the debt service and repay the PIR fund. He noted it was anticipated additional TIF would be available to fund other District developments, but such excess will not be available if the commercial class rate is dropped to 3%. Councilmember Malone stated he is comfortable with the requested action and agrees a conservative evaluation is being used. MOTION: Councilmember Aplikowski moved and Councilmember Keim seconded a motion to adopt Resolution #98-09, Providing for the Sale of $3,100,000 General Obligation Tax Increment Bonds, Series 1998A, subject to execution of the development agreement." The motion carried unanimously (5-0). B. Resolution #98-13, Authorizing Prcparation of Plans and Specifications for the Construction of a City Trail Culvert Ms. Cindy Walsh, Parks and Recreation Director, explained that the Council is asked to adopt . Resolution #98-13, Authorizing Preparation of Plans and Specifications for the construction ofa City trail culvert. This action would direct BR W to prepare plans and obtain bids for the culvert improvement due to its current inadequate condition. Ms. Walsh reviewed the work to be