2007 02-20 CCP - Laserfiche WebLink

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V. FINANCING THE CAPITAL IMPROVEMENT PLAN The total amount of requested expenditures under the Capital Improvement Plan is approximately $1,129,463. If these expenditures are to be funded, that amount of money is anticipated to be generated through $376,488 in White Bear Township funds and the sale of approximately $785,000 in bonds over the five-year period. In the financing of the Capital Improvement Plan, two statutory limitations apply. Under Chapter 475, with few exceptions, municipalities cannot incur debt in excess of 2% of the assessor's taxable market value for the municipality. However, Section 521 of Chapter 475 allows municipalities with a population of fewer than 2,500 to be exempt from net debt limits. In the City the population is 442. Therefore, the limitation on net debt does apply. In the City the TMV is $78,235,400. Therefore, if the City were subject to the net debt limit, the total amount of outstanding debt cannot exceed $1,564,708. As of this date the City had $-0- subject to the legal debt limit. Another limitation on bonding under the Capital Improvement Plan Statute (475.521) is that without referendum, the total amount that can be used for principal and interest in any one year for CIP debt cannot exceed 0.16% of the TMV for the municipality. In the City, that amount is $125,177 ($78,235,400 x .0016). The principal and interest payments are estimated to start at $47,038 in calendar year 2008 and increase to a peak of $75,690 in the year 2023. Under the Capital Improvement Plan, the City will secure approximately $785,000 in general obligation bonds in the year 2007 to finance the Joint Use City Hall Building. No additional general obligation bonds are anticipated to be issued at this time. The general obligation bond issue will be repaid over a 20-year period. The par amount of the issue is based on the amount listed in Appendix A plus estimated issuance costs. The proposed general obligation capital improvement bond (including issuance costs) is shown in Appendix B. Continuation of the Capital Improvement Plan This Capital Improvement Plan should be reviewed annually by the City Council using the process outlined in this Plan. It should review proposed Ehlers & Associates, Inc. Page 9