CCP 07-19-2004 - Laserfiche WebLink

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. , . ~ 4'\.~ILLS MEMORANDUM DATE: July 12, 2004 Agenda Item 2.A TO: Honorable Mayor and City Council FROM: Murtuza Siddiqui, Finance Director/Treasurer.....S SUBJECT: Bond Refunding BACKGROUND: . In 1998, the City of Arden Hills issued $3, I 00,000 in General Obligation Tax Increment Bonds, Series 1998A. The bonds were issued for the purpose of financing for relocated 14th street improvements and Round Lake RoadlHighway 96 intersection improvements in Tax Increment District No.2. At the April 19, 2004, Work Session, Mark Ruff, Ehlers & Associates made a presentation outlining the benefits of refunding as well as providing some background information. At that time, the Council as in support ofrefunding, however, requested additional information with regards to cash flows. DISCUSSION: As a follow-up to the April's discussion, Mr. Ruff has provided an analysis based on the most recent rates. The Council requested Mr. Ruff to perform an analysis with the current rates and asked him to project the cash flows to determine when and ifthe City would be able to pre-pay the bonds. His analysis is based on two scenarios. The first scenario is with refunding and the second is without refunding. Under both scenarios, the City will be able to pre-pay the bonds in 2012, assuming that the revenue stream from the TIF district is steady and that no charges other than debt service are made against it. The cost savings to the City with refunding is approximately $94,000, including issuance costs. Mark Ruff of Ehlers & Associates, Inc. will make a presentation, outlining the benefits of refunding and pre-payments at this Work Session. Please see the attachments from Ehlers & Associates, Inc. RECOMMENDED ACTION: . Staff recommends that the Council consider the option of refunding Bond Series 1998A.