2019-01-09 CC Set Agenda - Laserfiche WebLink

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r 1,110M ,C ;ld..,M✓�so3s ": .�eaGBiS a a9 Au4."'�✓' 6-51-429-3232,,r�c51a9-scz9 Memorandum Date: January 9, 2019 To: Honorable Mayor and City Council Members Through: Mark R. Statz, City Administrator/City Engineer From: Bruce DeJong, Finance Director Item: 2015A Bond Fund (Commerce Drive) City staff has discussed the offer for the remaining parcel on Commerce Drive in relation to the bond issue that originally funded the improvements. This memo will demonstrate the effect of a proposed sale at$400,000 on the debt service fund. The brokerage agreement lists a commission of 7%if a buyer's broker is involved, similar to the Ruffridge-Johnson sale ($28,000). There may be other minor fees that the city is responsible for paying during the closing process which we have estimated at $2,000. Subtracting $30,000 from the sale price leaves net proceeds to the city of $370,000. There is a total of$1,315,000 in outstanding bond principal payable through February 1, 2025, of which $215,000 is due on February 1, 2019 along with $11,244 in interest. We have a fund balance of about$845,000 that occurred primarily because of net sale proceeds of$837,951 from Ruffridge-Johnson in 2018. It is anticipated that$206,200 in tax levy proceeds will come in during 2019. If we have net proceeds from the sale of $370,000, we will have sufficient funds on hand to call the bonds at the first possible call date of February 1, 2020. There should be about$92,000 remaining in the debt service fund that can be transferred to other uses when the bonds are fully redeemed and the fund is closed. There will also be annual assessments coming from the Sheehy property of $4,990 from 2021 through 2024 for an additional total of just under$20,000 that can be assigned to another fund. 61