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City Council Regular Meeting — 09/27/04 <br />DRAFT Minutes - Page 8 <br />Roseville was being asked to participate in this bond issue Homes <br />when the property acquisition land improvements were <br />outside the City of Roseville. <br />Finance Director Miller clarified that it was common <br />practice for municipalities to provide a conduit for non- <br />profit entities, as had been done several times in the past, <br />with the City serving as a conduit for Presbyterian Homes <br />several times in the last five years. Mr. Miller noted that, <br />this allowed the non-profit to take advantage of the City's <br />fiscal year excess bonding authority to create more interest <br />in the marketplace, and achieve a more attractive interest <br />rate. <br />Mr. Miller opined that this served as an advantage both to <br />the non-profit, and the City, with their continued presence <br />in and housing service for seniors in the community. Mr. <br />Miller further clarified that by serving as a conduit, did <br />not constitute any legal or debt on the City's part, simply <br />the City's pledge of their bonding authority; and that a11 <br />legal fees for bond counsel and the issuance were borne by <br />Presbyterian Homes. Mr. Miller noted that the City's <br />administrative costs were offset by the participation fee <br />received by the City from Presbyterian Homes. <br />Councilmember Ihlan sought further clarification from Mr. <br />Miller on the non-profit's ability to obtain financing <br />through other cities or entities. <br />Finance Director Miller noted that other cities were also <br />participating; that each City had a bonding limit or <br />threshold; and with a larger "pool" a more favorable <br />bidding climate for bond interest rates would be available. <br />Mr. Miller further noted that, through the participation of <br />municipalities, the bond issue became qualified for bank <br />bidding, rather than just institutional investors, allowing <br />local banks to participate in the bidding process. <br />Finance Director Miller reiterated that the City of Roseville <br />bore no legal obligation, that Presbyterian Homes would <br />bear 100% of the risk with the bond issue. <br />