1b Sale of GO Equip Certificate:Lb
CITYOF
PO Box 147
Charh~, MN 55317
Administration
Phone: 952.227.1100
Fax: 952.227.1110
Building Inspections
Phone: 952_227.1180
Fac 952.227.1190
Engineering
Phone: 952.227.1160
Fmc 952227.1170
Finance
Phone: 952.227.1140
Fax: 952.227.1110
Park & Recreation
Phone: 952.227.1120
Fax: 952.227.1110
Reo'eatJo~ Center
2310 Coulter Boulevard
Phone: 952.227.1400
Fax: 952227.1404
Planning &
Natural Resources
Phone: 952.227.1138
Fax: 952.227.1110
Public Woda
1591 Park Road
Phone: 952227.1300
Fax:. 952.227.1310
Senior Center
Phone: 952.227.1125
Fax: 952227.1110
Web Site
www. cLchan~men.mn.us
TO: Mayor
City Council
FROM: Bruce M. DeJong, Finance Director
DATE: May 7, 2003
SUBJECT: Call for Sale of G.O. Equipment Certificate~, Series 2003
The 2003-2007 Capital Tmprovements Program (CIP) anticipated selling
equipment certificates to pay for ~ equipment and improvements throughout
the city. Those itema are listed below along with a more exact cost est--. This
is the official call for the sale which sets a sale date and allows Ehlers to begin
preparing the information necess~ for the actual sale. The total sale is
recommended to be $732,000 which includes $714,365 for actual equipment and
$17,635 for issuance costs.
The proposed sale date for this issue is June 23, 2003. This date is a change from
the May sale we had eat'Her ~ It looks as if there will not be any
legislation restricting a city's ability to sell bonds during this legislative session
and the June date gives us more time to fully prepare the information necess~
for the sale.
Selling equipment certificates is advantageous in three specific ways. It allows
the city to reAtw~ the amount of cash outlay fzom existing fund balances, which
frees up cash to deal with any potential Tax Increment Financing (TIF) deficits. It
also avoids requiring a tax levy for the full amount during the current year. We
can also avoid any potential problems with the levy limits since this type of debt is
currently exempt from the levy limits imposed by the State of Minnesota.
When selling equipment cetlJficatcs, there is a window of time where they can be
effective. That window starts one year prior to the date of issuance and extends
for 18 months later. Any equipment that was designated as coming from bond
proceexls prior to purchase can be purchased using these funds.
The City of Chanhassen · A growing community with clean lakes, quality schools, a charming dovmtown, thriving businesses, winding trails, and beautiful padre. A gmat plato to live, work, and play.
Call for Sale of G.O. Equipment Certificates, Series 2003
May 7, 2003
Page 2
There are two items which have not been itemized-or bid at this point - the new
financial software and the Senior Center renovation. I am recomm~ that the
full mount of those esfimm~ be included in the initial equipment
mount. Those items may be eithex deleted prior to the actual sale or used for
other equipment in 2004 if the justific~on for those items is not sufficient.
Certificates of Indebtedness
100fL Aerial Ladder Refurbishing
Fire DepL: 8CBA Upgrade~
Fire Dept.: 1 3/4 Inch Hose
Fire Dept.: PPE (Tumout/Helmels)
Compu~ Purch~/Upgrades
Dump/Plow Truck Replacements/Additions
Ford 555C Backhoe
Tractor
Trailer
Grounds Mower Replacement (10')
Dive Team Equipment
Web-Enabled Software
Computerized Records Retention Systsm
Cushman Trail Vehicle
Aerial Maps for GIS
~ Vehicle
Rm Department Equipment
Senior Center Exp sion
Ccrffficatcs of'Tndc~s
CIP F_,stima~ New Estimate
EQ-001 0 20,000 20,000
EQ-(X)4 0 9,000 9,050
EQ-007 0 1,000 1,000
EQ-010 0 15,000 15,000
EQ-013 0 78,800 74,720
EQ-016 0 120,000 120,040
EQ-023 0 60,000 Will not purchase In 2003.
EQ-024 0 45,000 38,000
EQ-035 0 30,00O 23,000
EQ-037 0 7,000 3,400
EQ-038 0 45,OOO 45,4OO
EQ-042 0 6,000 6,000
EQ..048 3 20,000 15,000
EOA)48 0 165,000 165,000
EQ4349 0 20,O0O 16,255
EQ-053 2 16,000 16,000
EQ-055 0 30,000 Will not purchase in 2003.
EQ-064 0 23,000 24,200
EQ-066 0 23,000 22,300
MB-O04 0 100,000 100,000
83%8OO 7t4,365
AtLachments: Pre-Sale Report
Resolution
City of Chanhassen, Minnesota
Pre-Sale Report
Proposed Issue:
Purpose:
$ Gen~ Obligation Equipment C, ertificate~ Series 2003A
To fund approxima~ly $_00,000 of general City equipment including
computer
Term/Call Feature:
Funding Sources:
Discussion Issues:
The total term of the equipment certificates will be five years with principal first payable
in February, 2005 but with four years of tax levy. Cap~ interest will be required to
pay for the interest payment d~_~e Febnmry 1, 2004. The Cerfifi~ will have a final
maturity on February l, 2008.
The ~cates will be paid w/th a tax levy be~nnln~ with taxes payable in 2004. The
levy will be a debt levy ou~ide of levy limits
Because of the relatively small mount of bonds being sold for equipment purposes, no
restrictions such as reverse refer~ apply to the City. The Bonds are expected to be
bank qualified because the City does not expect to issue more than $10,000,000 in total
principal mount of governmeffafl or non-profit bonds in the calendar year 2003. We do
not expect to ask S&P for a tm/rig on the bonds given the relatively small size and short
term of the debt.
Schedule:
Pre-Sale Review:
Distribute Official Statement:
Bond Sale:
Estimated Closing Date:
January 21, 2003
Week of June 16, 2003
June 23, 2003
Week of July 14
Attachments:
Resolution authorizing Ehlers to proceed with bond sale
Ehler~ Contaet~:
Financial Advisors:
Bond Analysts:
Bond Sale Coord]nm~.
Mark Ruff (651) 697-8505
Jim Prosser (651) 69'7-8503
Diana Lockard (651) 697-8534
Debbie Holmes (651) 69?-8536
Connie Kuck (651) 697-8527
The 02~cial Statem~ for this fina~ing will be mailed to the Council Members at their home ~ for review
prior to the sale date~
Council Member
Resolution No.
introduced the following resolution and moved its adoption:
Resolution Providing for the Sale of
000 General Obligation Equipment Certificates, Series 2003A
A.
B,
WHERF~S, the City Council of the City of Chanlmas~ Minnosota, has herotofore de~emined that it
is necessary and expedient to issue the Ci~s $1,540,000 G-eneml Obligation Equipm~ Cerfific~.~, Saries
2003A (the "Certificates"), to finance the acquhition general equipment needs in the City, and
WHEREAS, the City has retained EM~ws & Assoc~ Inc., in Roseville, Minnesota ("Eh[ers"), as its
independent financial advisor for the Certifi~ and is therefore authorized to solicit proposals in
accordance with Minnesota Statutes, Section 475.60, Subdivision 2(9);
NOW, THEREFORE, BE IT RESOLVED by the C/ty Council of Chanhassen, Minnesota, as follows:
1. Authorization; Findings. The City Council hereby authorizes Ehlers to solicit proposals for the sale
of the Certificates.
2. Meeting; Proposal Opening. The City Council shall meet at 7:00 p.m. on June 23, 2003, for the
purpose of considering sealed proposals for and awarding the sale of the Certificates.
.
Official Statement. In connection with said sale, the officers or employees of the City are hereby
authorized to cooperate with Ehlers and participa~ in the preparation of an official statement for the
Certifi~ and to execute and deliver it on behalf of the City Upon/ts completion.
The motion for the adoption of the foregoing resolution was duly seconded by Council Member
and, afl~ full discussion thereof and upon a vote being taken thereon, the
following Council Members voted in favor thereof:
and thc following voted against the same:
Whereupon said resolution was declared duly passed and adopted.
Dated this ~ day of ,2003.
City Clerk