4. Award of Bid 2010B Advanced Refunding of the 2004B & 2005 B Water Revenue Bonds4
CITY OF
CHANgASSEN
7700 Market Boulevard
PO Box 147
Chanhassen, MN 55317
Administration
Phone: 952.227.1100
Fax: 952.227.1110
Building Inspections
Phone: 952227.1180
Fax: 952227,1190
Engineering
Phone: 952.227.1160
Fax: 952.227.1170
Finance
Phone: 952.227.1140
Fax: 952.227.1110
Park & Recreation
Phone: 952.227.1120
Fax: 952.227.1110
Recreation Center
2310 Coulter Boulevard
Phone: 952.227.1400
Fax: 952.227.1404
Planning &
Natural Resources
Phone: 952.227.1130
Fax: 952.227,1110
Public Works
1591 Park Road
Phone: 952.227.1300
Fax: 952.227.1310
Senior Center
Phone: 952.227.1125
Fax: 9522271110
Web Site
wwadchanhassen.mn.us
MEMORANDUM
TO: Mayor & City Council Members
FROM: Greg Sticha, Finance Director'�
DATE: September 27 2010
SUBJ: Award of Bid, 2010B Advanced Refunding of the 2004B &
2005B Water Revenue Bonds
PROPOSED MOTION
"Staff recommends that the City Council award the bid for the Advance
Refunding of the 2004B & 2005B Water Revenue Bonds to the low bidder (to
be announced at the meeting that evening)."
Approval of this resolution requires a simple majority vote of those City
Council members present.
BACKGROUND
At the work session on September 13, staff discussed the potential opportunity
to advance refund the 2004B & 2005B water revenue bonds. The bonds were
originally sold for the construction of the water treatment plant and some other
minor water system improvements. Advantages of the refunding include:
The original debt had an average coupon (interest rate) of 3.82%
(2005B) and 4.62% (2004B). It is estimated that the new debt will have
a true interest cost (TIC) of 2.2% (keep in mind market conditions can
change in the next week).
Staff is estimating the net present value savings to the city will be
approximately $350,000 or 4.1 %.
During the past week, Standard & Poors conducted a review process to
determine the city's bond rating. The results of that rating and the
recommended low bidder will be announced at the council meeting.
Representatives from our financial advisors, Ehlers & Associates, will be
available to discuss the sale of the bonds at the meeting.
If the sale does not achieve a Net Present Value savings greater than 4 %, as
required by our debt policy, staff will not proceed with the bid award. Staff will
Chanhassen is a Community for Life - Providing for Today and Planning for Tomorrow
Mayor & City Council
September 27, 2010
Page 2
bring all documentation, including the resolution to award the bid, to the
meeting that evening.
RECOMMENDATION
Staff recommends that the City Council award the bid for the Advance
Refunding of the 2004B & 2005B water revenue bonds to the lowest bidder.
ATTACHMENT
Staff Report from September 13, 2010 Meeting
fAgregs \bonding\2010 bonding\2010b award of bid bonds.docx
CITY OF
CAANHASSEN
7700 Market Boulevard
PC Box 147
Chanhassen, MN 55317
Administration
Phone: 952.227.1100
Fax: 952.227.1110
Building Inspections
Phone: 952.227.1180
Fax: 952.227.1190
Engineering
Phone: 952.227.1160
Fax: 952.227.1170
Finance
Phone: 952.227.1140
Fax: 952.227.1110
Park & Recreation
Phone: 952.227.1120
Fax: 952.227.1110
Recreation Center
2310 Coulter Boulevard
Phone: 952.227.1400
Fax: 952.227.1404
Planning &
Natural Resources
Phone: 952.227.1130
Fax: 952.227.1110
Public Works
1591 Park Road
Phone: 952227.1300
Fax: 952.227.1310
Senior Center
Phone: 952,227.1125
Fax: 952.227.1110
Web Site
www.ci.chanhassen.mn.us
0 0
MEMORANDUM
TO: Mayor and City Council
FROM: Greg Sticha, Finance Director6b ,
DATE: September 13, 2010 01�,
v+
SUBJ: Refunding the 2004A G.O. Bonds; Advanced Refunding of the 2004B
& 2005B Water Revenue Bonds
PROPOSED MOTIONS
Staff recommends the City Council adopt the following two motions:
"The City Council adopts a resolution calling for the redemption of the 2004A
General Obligation Bonds."
"The City Council adopts a resolution calling for the sale of Advanced Refunding of
the 2004B & 2005B Water Revenue Bonds."
Approval of this item requires a simple majority vote of those City Council members
present.
2004A G.O. Bonds — The 2004A G.O. Bonds were sold for three purposes:
Description
Amount
Special assessments related to the 2004 Street Improvement Project
(Santa Fe, Del Rio Drive /Trail /Circle)
$960,000
Equipment Purchases
$765,000
Senior Center Improvements
$292,000
The bonds are callable and there is currently $200,000 in cash in the debt service fund
to pay the debt early. The total remaining principal and accrued interest to pay off the
debt is approximately $265,000. It is staff's plan to use the $200,000 in the debt
service fund and $65,000 from the closed bond fund to retire the debt. There is
approximately $94,000 in special assessments that have yet to be paid for the street
reconstruction portion of the bonds. Those remaining assessments will be paid to the
closed bond fund to reimburse it for the cash used to retire the debt early.
The attached resolution authorizes redemption of the 2004A bonds. Once this
resolution is passed, bondholders will be given a 30 -day notice that the bonds will be
redeemed in full, and they will receive payment in full on the call date.
Chanhassen is a Community for Life - Providing for Today and Planning for Tomorrow
•
Refunding Bonds
September 13, 2010
Page 2
2004B & 2005B Water Revenue Bonds — We have been monitoring the 2004B & 2005B Water
Revenue Bonds for a potential advanced refunding. This is very similar to the advanced
refunding we did with the Library Bonds earlier this year. Currently, borrowing interest rates are
at an all -time historical low. Based on the analysis done by our financial advisers Ehler's &
Associates, we would achieve a Net Present Value savings of 4.00 %, and would save the city
approximately $350,000 in interest costs over the remaining life of the bonds.
The 2004B & 2005B Water Revenue Bonds were issued for the construction of the water
treatment plant and some other smaller water system improvements.
The attached resolution calls for the sale of advanced refunding bonds, with the actual sale of the
bonds anticipated to take place on September 27 It is staff's intent to not actually refund the
bonds if a Net Present Value savings of 4% is not achieved as required by the city's debt policy.
RECOMMENDATION
Staff recommends that the City Council adopt the attached resolutions authorizing the redemption
of the 2004A General Obligation Bonds, and calling for the sale of Advanced Refunding of the
2004B & 2005B Water Revenue Bonds.
ATTACHMENTS:
1. Resolution calling for the redemption of the 2004A General Obligation Bonds.
2. Resolution calling for the sale of Advanced Refunding Bonds for the 2004B & 2005B
Water Revenue Bonds.
3. Pre -Sale Report for Advanced Refunding Water Revenue Bonds.
f: \gregs \bonding\2010 bonding \call for sale 2004a, 2004b, and 2005b 9- 13- 10.docx
i
•
EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE CITY OF CHANHASSEN, MINNESOTA
HELD: September 13, 2010
Pursuant to due call and notice thereof, a regular meeting of the City Council of the City
of Chanhassen, Carver and Hennepin Counties, Minnesota, was held at the City Hall on
September 13, 2010, at 7:00 o'clock P.M.
The following members were present:
and the following were absent:
Member introduced the following resolution and moved its adoption:
RESOLUTION CALLING FOR REDEMPTION OF CERTAIN OUTSTANDING BONDS
A. WHEREAS, the City of Chanhassen, Minnesota (the "City ") issued $2,070,000
General Obligation Bonds, Series 2004A, dated August 10, 2004 (the "Bonds "), of which
$260,000 remains outstanding; and
B. WHEREAS, all Bonds maturing in the years 2011 and thereafter, are subject to
redemption and prepayment at the option of the City, on February 1, 2009, and on any date
thereafter, at par and accrued interest, all as provided in the resolution of the City Council
adopted on July 12, 2004, authorizing the issuance of the Bonds (the "Prior Resolution "); and
C. WHEREAS, the City Council deems it desirable and in the best interests of the
City to call the 2011 through 2015 maturities of the Bonds, totaling $260,000 in principal
amount, on October 19, 2010, in accordance with the Prior Resolution.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Chanhassen, Minnesota, as follows:
1. Bonds to be Redeemed Bonds maturing in the years 2011 through 2015,
inclusive, shall be redeemed and prepaid on October 19, 2010 at par and accrued interest.
2. Mailing of Notice of Call for Redemption The City Manager shall cause the
Notice of Call for Redemption attached hereto as Exhibit A to be mailed thirty days prior to
October 19, 2010, to the paying agent for the Bonds.
3. Deposit of Sufficient Funds The City Finance Director is hereby authorized and
directed to deposit with the paying agent prior to October 19, 2010, sufficient funds to pay the
principal and interest due on the Bonds called for redemption.
The motion for the adoption of the foregoing resolution was duly seconded by Member
and upon a vote being taken thereon, the following voted in favor thereof:
and the following voted against the same:
Whereupon the resolution was declared duly passed and adopted.
• •
STATE OF MINNESOTA
COUNTIES OF CARVER AND HENNEPIN
CITY OF CHANHASSEN
The undersigned, being the duly qualified and acting City Manager of the City of
Chanhassen, Minnesota, do hereby certify that I have carefully compared the attached and
foregoing extract of minutes of the City Council of the City of Chanhassen, Minnesota, held on
the date therein indicated, with the original thereof on file in my office, and the same is a full,
true and complete transcript therefrom insofar as the same relates to authorizing the redemption
of Bonds.
WITNESS my hand as such City Manager on September 13, 2010.
City Manager
2
+r i
Exhibit A
NOTICE OF CALL FOR REDEMPTION
GENERAL OBLIGATION BONDS, SERIES 2004A
CITY OF CHANHASSEN
CARVER AND HENNEPIN COUNTIES
MINNESOTA
NOTICE IS HEREBY GIVEN that by order of the City Council of the City of Chanhassen,
Carver and Hennepin Counties, Minnesota, there have been called for redemption and
prepayment on
October 19, 2010
those outstanding bonds of the City designated as General Obligation Bonds, Series 2004A,
dated August 10, 2004, having stated maturity dates in the years 2011 through 2015, inclusive,
and totaling $260,000 in principal amount.
Year
CUSIP Number
2011
2012
2013
2014
2015
The bonds are being called at a price of par plus accrued interest to October 19, 2010, on which
date all interest on the bonds will cease to accrue. Holders of the bonds hereby called for
redemption are requested to present their bonds for payment, at Bond Trust Services
Corporation, 3060 Centre Point Drive, Roseville, Minnesota, on or before October 19, 2010.
Dated: September 13, 2010
BY ORDER OF THE CITY COUNCIL
/s/ Todd Gerhardt
Manager
*The City shall not be responsible for the selection of or use of the CUSIP numbers, nor is any
representation made as to their correctness indicated in the notice. They are included solely for
the convenience of the holders.
gAadminVesohredemption of 2004a go bonds.doc
A -1
0 •
CITY OF CHANHASSEN
CARVER AND HENNEPIN COUNTIES, MINNESOTA
DATE: September 13, 2010 RESOLUTION NO: 2010-
MOTION BY: SECONDED BY:
RESOLUTION PROVIDING FOR THE SALE OF
$8,935,000 G.O. WATER REFUNDING BONDS, SERIES 2010B
WHEREAS, the City Council of the City of Chanhassen, Minnesota, has heretofore
determined that it is necessary and expedient to issue the City's $8,935,000 General Obligation
Water Refunding Bonds (the "Bonds "), to provide for an advanced refunding of the $7,930,000
G.O. Water Revenue Bonds, Series 2004B, and an advanced refunding of the $5,460,000 G.O.
Water Revenue Bonds, Series 2005B in the City; and
WHEREAS, the City has retained Ehlers & Associates, Inc., in Roseville, Minnesota
( "Ehlers "), as its independent financial advisor for the Bonds 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 City Council of the City of
Chanhassen, Minnesota, as follows:
1. Authorization; Findings The City Council hereby authorizes Ehlers to solicit proposals for
the sale of the Bonds.
2. Meeting; Proposal Opening The City Council shall meet at 7:00 p.m. on September 27,
2010, for the purpose of considering sealed proposals for and awarding the sale of the Bonds.
3. Official Statement In connection with said sale, the officers or employees of the City are
hereby authorized to cooperate with Ehlers and participate in the preparation of an official
statement for the Bonds and to execute and deliver it on behalf of the City upon its
completion.
Passed and adopted by the Chanhassen City Council this 13 day of September, 2010.
ATTEST:
Todd Gerhardt, City Manager Thomas A. Furlong, Mayor
YES NO ABSENT
gAadmin\resol\sale of 201 0b water refunding bonds.doc
0 .
r� r� D eb t I ssua n ce Se
September 13, 2010
Pre -Sale Report for
$8,935,000 General Obligation Water
Refunding Bonds, Series 2010B
City of Chanhassen, Minnesota
[y6ul �
EHLERS
LEADERS IN PUBLIC FINANCE
www.ehlers- inc.com
Minnesota phone 651 - 697 -8500 3060 Centre Pointe Drive
Offices also in Wisconsin and Illinois fax 651 -697 -8555 Roseville, MN 55113 -1122
0
•
r� r� Debt Issuance Services
Details of Proposed Debt
Proposed Issue: $8,935,000 General Obligation Water Refunding Bonds, Series 2010B (the
"Bonds ")
Purpose: The Bonds consist of the following purposes:
1) To refund all of the callable maturities of City's $7,930,000 General
Obligation Water Revenue Bonds, Series 2004B, dated August 10,
2004; and
2) To refund all of the callable maturities of the City's $5,465,000
General Obligation Water Revenue Bonds, Series 2005B, dated
November 16, 2005 (collectively the "Prior Bonds ").
The refunding of the Prior Bonds will be an advance refunding, with
proceeds put in escrow to pay debt service on the new Bonds until the call
dates in 2013 and 2014. This means savings will not commence until
2013. Based on current interest rates of 0.80% to 2.80% (TIC of 2.24 %),
the estimated savings as a result of the refunding is approximately a
present value $350,000 after all fees and expenses. This savings expressed
in present value terms is 4.2% percent of the principal of the Prior Bonds.
The City of Chanhassen has a policy to undertake an advanced refundings
only if the net present value of the savings exceeds 4.0% of the refunded
principal.
The purpose of the refunding is to reduce overall interest costs.
Authority: The Bonds are being issued pursuant to Minnesota Statues, Chapter 475
and 444. Because the City expects to pay for 100% debt service from water
revenues, the Bonds can be a general obligation without a referendum and
will not count against the City's debt limit.
Funding Source: For the Bonds, 100% of the debt service will be paid with water revenues.
Risk Factors: The Bonds are advance refunding. If the City believes interest rates will
stay the same or be lower over the next three years, the City should wait to
undertake the refunding at a future time to reduce the negative arbitrage in
the escrow fund of over $300,000. The savings are net of the negative
arbitrage.
The Bonds are general obligation bonds secured by the City's full faith,
credit and taxing powers. This pledge helps improve the credit worthiness
of the bonds and reduces interest costs. The pledge does mean that if any
of the revenue expected to pay the debt service cost is not available that the
City will increase the debt levy to pay the debt service. There is risk for
this increase any time the full faith and credit pledge is provided.
0 •
r� I� Deb I ssua n ce Services
Arbitrage Monitoring: The IRS is becoming more active in surveying municipal issuers.
Therefore, IRS rules regarding the amount of interest that the City may
earn on bond proceeds and in its debt service funds. The bond proceeds
will be escrowed until the call dates on the Prior Bonds; however, it is
expected that interest earnings will be less than the bond yield. The City
will need to file a report with the IRS within 30 days of the call date for
each of the Prior Bonds.
Rating: The City is currently rated "AAA" by Standard and Poor's. We will
request a rating on this issue.
Bank Qualification: Because the City is issuing less than $30,000,000 in the calendar year, the
City will be able to designate the Bonds as "bank qualified" obligations.
Bank qualified status broadens the market for the Bonds, which can result
in lower interest rates.
Term /Call Feature: The Bonds are being issued for a 15 year term with principal paid on
February 1, 2014 through February 1, 2025. Interest is payable each six
months beginning February 1, 2011. The Bonds maturing February 1,
2020, and thereafter will be subject to prepayment at the discretion of the
City on February 1, 2019. The term of the Bonds will remain the same as
the Prior Bonds.
Other We will continue to monitor the market and the call dates for the City and
Considerations: will alert you to any future opportunities.
Proposed Debt Issuance Schedule
City Council Meeting to Call for the Sale of the
Bonds: September 13, 2010
Official Statement Distributed to Market:
Rating Agency Conference Call:
September 16, 2010
Approximately September 20, 2010
City Council Meeting to Award Sale of the Bonds: September 27, 2010
Estimated Closing Date:
Week of October 18, 2010
Attachments
Sources and Uses of Funds
Proposed Debt Service Schedule
Resolution Providing for the Sale of Bonds
Bond Buyer Index
0 •
l� l� D eb t I ssua n ce Se
Ehlers Contacts
Financial Advisors: Mark Ruff
(651) 697 -8505
Dave Callister
(651) 697 -8553
Jessica Cook
(651) 697 -8546
Bond Analysts: Diana Lockard
(651) 697 -8534
Debbie Holmes
(651) 697 -8536
Bond Sale Coordinator: Alicia Aulwes
(651) 697 -8523
City of Chanhassen, MN
Issue Summary - Proposed Crossover Refunding of
$5,465,000 General Obligation Water Revenue Bonds, Series 2005B
& $7,930,000 G.O. Water Revenue Bonds, Series 2004B
Table of Contents
Report
ISSUE SUMMARY
Total Issue Sources And Uses
1
Debt Service Schedule
2
Debt Service Comparison
3
Crossover Escrow Fund Cashflow
4
ADV REF SER 2005B
Prior Original Debt Service
5
Debt Service Schedule
6
Debt Service Comparison
7
ADV REF SER 2004B
Prior Original Debt Service
g
Debt Service Schedule
9
Debt Service Comparison
1p
10 xover Ser 05B $5.465M I Issue Summary 1 9/ 7/2010 1 2:51 PM
City of Chanhassen, MN
Issue Summary - Proposed Crossover Refunding of
$5,465,000 General Obligation Water Revenue Bonds, Series 2005B
& $7,930,000 G.O. Water Revenue Bonds, Series 2004B
Total Issue Sources And Uses
Dated 10/2012010 1 Delivered 10/20/2010
Adv Ref Ser
2005B
Adv Ref Ser
2004B
Issue
Summary
Sources Of Funds
Par Amount of Bonds $3,465,000.00
$5,470,000.00
$8,935,000.00
Total Sources $3,465,000.00
$5,470,000.00
$8,935,000.00
Uses Of Funds
Total Underwriter's Discount (0.800 1 /o) 27,720.00
43 760.00
71 480.00
Costs of Issuance 18,614.44
29 385.56
48 000.00
Deposit to Crossover Escrow Fund 3,418,215.13
5,394,460.47
8,812,675.60
Rounding Amount 450.43
2,393.97
2,844.40
Total Uses $3,465,000.00
$5,470,000.00
$8,935,000.00
10 xover Ser 05B $5.465M I Issue Summary 1 9/ 7/2010 1 2:51 PM
Ehlers
City of Chanhassen, MN
Issue Summary - Proposed Crossover Refunding of
$5,465,000 General Obligation Water Revenue Bonds, Series 2005B
& $7,930,000 G.O. Water Revenue Bonds, Series 2004B
Debt Service Schedule
Date Principal Coupon
Interest
Total PA
Fiscal Total
10/20/2010
-
-
-
02/01/2011
48,869.27
48,869.27
48,869.27
08/01/2011
87,093.75
87,093.75
-
02/01/2012
87,093.75
87,093.75
174,187.50
_08/01/2012
87,093.75
87,093.75
-
02/01/2013 -
87,093.75
87,093.75
174,187.50
08/01/2013 - -
87,093.75
87,093.75
-
02/01/2014 410,000.00 0.800%
87,093.75
497,093.75
584,187.50
08/01/2014 - -
85,453.75
85,453.75
-
02/01/2015 820,000.00 1.100%
85,453.75
905 453.75
990 907.50
08/01/2015 - -
80,943.75
80,943.75
-
02/01/2016 875,000.00 1.350%
80,943.75
955,943.75
1,036,887.50
08/01/2016 - -
75,037.50
75,037.50
02/01/2017 885,000.00 1.650%
75,037.50
960,037.50
1,035,075.00
08/01/2017
67,736.25
67,736.25
02/01/2018 910,000.00 1.800%
67,736.25
977,736.25
1,045,472.50
08/01/2018 - -
59,546.25
59,546.25
-
02/01/2019 930,000.00 2.000%
59,546.25
989,546.25
1,049,092.50
08/01/2019 - -
50,246.25
50,246.25
02/01/2020 945,000.00 2.150%
50,246.25
995,246.25
1,045,492.50
08/01/2020 - -
40,087.50
40,087.50
02/01/2021 970,000.00 2.300%
40,087.50
1,010,087.50
1,050,175.00
08/01/2021 - -
28,932.50
28,932.50
-
02/01/2022 520,000.00 2.450%
28,932.50
548,932.50
577,865.00
08/01/2022 - -
22,562.50
22 562.50
02/01/2023 540,000.00 2.600%
22,562.50
562,562.50
585,125.00
08/01/2023 - -
15,542.50
15,542.50
-
02/01/2024 555,000.00 2.700%
15,542.50
570,542.50
586,085.00
08/01/2024 - -
8,050.00
8,050.00
-
02/01/2025 575,000.00 2.800%
8,050.00
583,050.00
591100.00
Total $8,935,000.00 -
$1,639,709.27
$10,574,709.27
-
Yield Statistics
Bond Year Dollars
$76,181.76
Average Life
8.526 Years
Average Coupon
2.1523645%
Net Interest Cost (NIC)
2.2461928%
True Interest Cost (TIC)
2.2410207%
_Bond Yield for Arbitrage Purposes
2.1369252%
All Inclusive Cost (AIC)
2.3115131%
IRS Form 8038
Net Interest Cost
2.1523645%
Weighted Average Maturity
8.526 Years
10 xover Ser 05B $5.465M I Issue Summary 1 9/ 7/2010 1 2:51 PM
Ehlers
City of Chanhassen, MN
Issue Summary - Proposed Crossover Refunding of
$5,465,000 General Obligation Water Revenue Bonds, Series 2005B
& $7,930,000 G.O. Water Revenue Bonds, Series 2004B
Debt Service Comparison
Date Total PA PCF Existing D/S
Net New D/S
Old Net D/S
Savings
Fiscal Total
10/20/2010 -
02/01/2011 48,869.27 (48,869.27) -
-
-
08/01/2011 87,093.75 (87,093.75) 271,983.61
271,983.61
271,983.61
02/01/2012 87,093.75 (87,093.75) 174,224.38
174,224.38
174,224.38
08/01/2012 87,093.75 (87,093.75) 174,224.38
174,224.38
174,224.38
02/01/2013 87,093.75 (3,417,093.75) 3,504,224.38
174,224.38
174,224.38
-
08/01/2013 87,093.75 (58,310.00) 110,876.88
139,660.63
174,224.38
34,563.75
-
02/01/2014 497,093.75 (58,310.00) 110,876.88
549,660.63
534,224.38
(15,436.25)
19,127.50
08/01/2014 85,453.75 (5,208,310.00) 5,260,876.88
138,020.63
167,474.38
29,453.75
-
02/01/2015 905,453.75
905,453.75
917,474.38
12,020.63
41,474.38
08/01/2015 80,943.75
80,943.75
152,949.38
72,005.63
-
02/01/2016 955,943.75
955,943.75
927,949.38
(27,994.37)
44,011.26
08/01/2016 75,037.50
75,037.50
137,936.88
62,899.38
-
02/01/2017 960,037.50
960,037.50
942,936.88
(17,100.62)
45,798.76
08/01/2017 67,736.25
67,736.25
122,143.13
54406.88
02/01/2018 977,736.25
977,736.25
967,143.13
(10,593.12)
43,813.76
08/01/2018 59,546.25
59,546.25
105,248.13
45,701.88
-
02/01/2019 989,546.25
989,546.25
985,248.13
(4,298.12)
41,403.76
08/01/2019 50,246.25
50,246.25
87,428.13
37,181.88
-
02/01/2020 995,246.25
995,246.25
1,002,428.13
7,181.88
44,363.76
08/01/2020 40,087.50
40,087.50
68,894.38
28,806.88
-
02/01/2021 1,010,087.50
1,010,087.50
1,028,894.38
18,806.88
47,613.76
08/01/2021 28,932.50
28,932.50
49,022.50
20,090.00
-
02/01/2022 548,932.50
548,932.50
554,022.50
5,090.00
25,180.00
08/01/2022 22,562.50
22,562.50
37,912.50
15 350.00
-
02/01/2023 562,562.50
562,562.50
572,912.50
10,350.00
25,700.00
08/01/2023 15,542.50
15,542.50
25,875.00
10,332.50
-
02/01/2024 570,542.50
570,542.50
585,875.00
15,332.50
25,665.00
08/01/2024 8,050.00
8,050.00
13,275.00
5,225.00
-
02/01/2025 583,050.00
583,050.00
603,275.00
20 225.00
25 450.00
Total $10,574,709.27 (9,052,174.27) $9,607,287.39
$11,129,822.39
$11,559,424.33
$429,601.94
-
PV Analysis Summary (Net to Net)
Gross PV Debt Service Savings .....................
358 801.32
Net PV Cashflow Savings @ 2.312 %(AIC) ............
358 801.32
Contingency or Rounding Amount ....................
2,844.40
Net Present Value Benefit
$361,645.72
Net PV Benefit / $8,749,638.09 PV Refunded Debt Service
4.133%
Net PV Benefit / $8,480,000 Refunded Principal...
4.265%
Net PV Benefit / $8,935,000 Refunding Principal..
4.048%
Refundina Bond Information
Refunding Dated Date
10/20/2010
Refunding Delivery Date
10/20/2010
10 xover Ser 058 $5.465M I Issue Summary 1 917/2010 1 2:51 PM
Ehlers
City of Chanhassen, MN
Issue Summary - Proposed Crossover Refunding of
$5,465,000 General Obligation Water Revenue Bonds, Series 2005B
& $7,930,000 G.O. Water Revenue Bonds, Series 2004B
Crossover Escrow Fund Cashflow
Cash
Date Principal Rate Interest
Receipts
Disbursements
Balance
10/20/2010 - - -
0.60
-
0.60
02/01/2011 28,762.00 0.120% 20,107.78
48,869.78
48,869.27
1.11
08/01/2011 51,456.00 0.200% 35,638.33
87,094.33
87,093.75
1.69
02/01/2012 51,535.00 0.300% 35,557.99
87,092.99
87,093.75
0.93
08/01/2012 51,613.00 0.430% 35,480.69
87,093.69
87,093.75
0.87
02/01/2013 3,381,724.00 0.560% 35,369.73
3,417,093.73
3,417,093.75
0.85
08/01/2013 32,409.00 0.690% 25,900.91
58,309.91
58,310.00
0.76
02/01/2014 32,521.00 0.830% 25,789.10
58,310.10
58,310.00
0.86
08/01/2014 5, 1 8 2,655.00 0.990% 25,654.14
5,208,309.14
5,208,310.00
-
Total $8,812,675.00 - $239,498.67 $9,052,174.27
$9,052,174.27
-
Investment Parameters
Investment Model [PV, GIC, or Securities]
Securities
Default investment yield target
Bond Yield
Cash Deposit
0.60
Cost of Investments Purchased with Bond Proceeds
8,812,675.00
Total Cost of Investments
$8,812,675.60
Target Cost of Investments at bond yield
$8,473,749.49
Actual positive or (negative) arbitrage
(338,926.11)
Yield to Receipt
0.8638383%
Yield for Arbitrage Purposes
2.1369252%
State and Local Government Series (SLGS) rates for
9/02/2010
10 xover Ser 0513 $5.465M I Issue Summary 1 9/ 7/2010 1 2:51 PM
Ehlers
City of Chanhassen, MN
$5,465,000 General Obligation Water Revenue Bonds,
Series 2005B
Prior Original Debt Service
Date Principal Coupon
Interest
Total PA
Fiscal Total
02/01/2011 -
-
-
_
08/01/2011
98,892.49
98,892.49
-
02/01/2012
63,347.50
63,347.50
162,239.99
08/01/2012
63,347.50
63,347.50
-
02/01/2013
63,347.50
63,347.50
126 695.00
08/01/2013 - -
63,347.50
63,347.50
-
02/01/2014 360,000.00 3.750%
63,347.50
423,347.50
486,695.00
08/01/2014 - -
56,597.50
56,597.50
-
02/01/2015 380,000.00 3.750%
56,597.50
436,597.50
493,195.00
08/01/2015 - -
49,472.50
49,472.50
-
02/01/2016 390,000.00 3.750%
49,472.50
439,472.50
488,945.00
08/01/2016 - -
42,160.00
42,160.00
-
02/01/2017 405,000.00 3.750%
42,160.00
447,160.00
489,320.00
08/01/2017 - -
34,566.25
34,566.25
-
02/01/2018 425,000.00 3.800%
34,566.25
459,566.25
494132.50
08/01/2018 - -
26,491.25
26,491.25
-
02/01/2019 440,000.00 3.850%
26,491.25
466,491.25
492,982.50
08/01/2019 - -
18,021.25
18,021.25
-
02/01/2020 455,000.00 3.850%
18,021.25
473,021.25
491,042.50
08/01/2020 - -
9,262.50
9,262.50
-
02/01/2021 475,000.00 3.900%
9,262.50
484,262.50
493,525.00
Total $3,330,000.00 -
$888,772.49
$4,218,772.49
-
Yield Statistics
Average Life
6.983 Years
Weighted Average Maturity (Par Basis)
6.983 Years
Average Coupon
3.8219787%
Refundina Bond Information
Refunding Dated Date
10/20/2010
Refunding Delivery Date
10/20/2010
Ser 05B $5.465M GO Wtr Re I SINGLE PURPOSE 1 9/ 7/2010 1 2:51 PM
Ehlers
City of Chanhassen, MN
$3,465,000 - Purpose One
Proposed Crossover Refunding of
$5,465,000 General Obligation Water Revenue Bonds, Series 2005B
Debt Service Schedule
Date Principal
Coupon
Interest
Total PA
Fiscal Total
10/20/2010
-
-
-
02/01/2011
16,150.88
16,150.88
16,150.88
08/01/2011
28,783.75
28,783.75
-
02/01/2012
28,783.75
28,783.75
57,567.50
08/01/2012
28,783.75
28,783.75
-
02/01/2013
28,783.75
28,783.75
57,567.50
08/01/2013 -
-
28,783.75
28,783.75
-
02/01/2014 410,000.00
0.800%
28,783.75
438,783.75
467,567.50
08/01/2014 -
-
27,143.75
27,143.75
-
02/01/2015 420,000.00
1.100%
27,143.75
447,143.75
474287.50
08/01/2015 -
-
24,833.75
24,833.75
-
02/01/2016 420,000.00
1.350%
24,833.75
444,833.75
469,667.50
08/01/2016 -
-
21,998.75
21,998.75
-
02/01/2017 425,000.00
1.650%
21,998.75
446,998.75
468,997.50
08/01/2017 -
-
18,492.50
18,492.50
-
02/01/2018 435,000.00
1.800%
18,492.50
453,492.50
471,985.00
08/01/2018 -
-
14,577.50
14,577.50
-
02/01/2019 445,000.00
2.000%
14,577.50
459,577.50
474,155.00
08/01/2019 -
-
10,127.50
10,127.50
-
02/01/2020 450,000.00
2.150%
10,127.50
460,127.50
470255.00
08/01/2020 -
-
5,290.00
5,290.00
-
02/01/2021 460,000.00
2.300%
5,290.00
465,290.00
470,580.00
Total $3,465,000.00
-
$433,780.88
$3,898,780.88
-
Yield Statistics
Bond Year Dollars
$23,787.13
Average Life
6.865 Years
Average Coupon
1.8235952%
Net Interest Cost (NIC)
1.9401289%
True Interest Cost (TIC)
1.9408300%
Bond Yield for Arbitrage Purposes
2.1369252%
All Inclusive Cost (AIC)
2.0257060%
IRS Form 0038
Net Interest Cost
1.8235952%
Weighted Average Maturity
6.865 Years
10 xover Ser 05B $5.465M I Adv Ref Ser 20056 1 9/ 712010 1 2:51 PM
Ehlers
City of Chanhassen, MN
$3,465,000 - Purpose One
Proposed Crossover Refunding of
$5,465,000 General Obligation Water Revenue Bonds, Series 2005B
Debt Service Comparison
Date Total P +I PCF Existina D/S
Net New D/S
Old Net D/S
Savinas
Fiscal Total
10/20/2010 -
02/01/2011 16,150.88 (16,150.88) -
-
-
08/01/2011 28,783.75 (28,783.75) 98,892.49
98,892.49
98,892.49
-
02/01/2012 28,783.75 (28,783.75) 63,347.50
63,347.50
63,347.50
-
08/01/2012 28,783.75 (28,783.75) 63,347.50
63,347.50
63,347.50
-
02/01/2013 28,783.75 (3,358,783.75) 3,393,347.50
63,347.50
63,347.50
-
08/01/2013 28,783.75
28,783.75
63,347.50
34,563.75
-
02/01/2014 438,783.75 -
438,783.75
423,347.50
(15,436.25)
19,127.50
08/01/2014 27,143.75 -
27,143.75
56,597.50
29,453.75
-
02/01/2015 447,143.75 -
447,143.75
436,597.50
(10,546.25)
18 907.50
08/01/2015 24,833.75 - -
24,833.75
49,472.50
24,638.75
-
02/01/2016 444,833.75 - -
444,833.75
439,472.50
(5,361.25)
19,277.50
08/01/2016 21,998.75 - -
21,998.75
42,160.00
20,161.25
-
02/01/2017 446,998.75 - -
446,998.75
447,160.00
161.25
20,322.50
08/01/2017 18,492.50
18,492.50
34,566.25
16,073.75
-
02/01/2018 453,492.50 -
453,492.50
459,566.25
6,073.75
22,147.50
08/01/2018 14,577.50 -
14,577.50
26,491.25
11,913.75
-
02/01/2019 459,577.50 -
459,577.50
466,491.25
6,913.75
18,827.50
08/01/2019 10,127.50 -
10,127.50
18,021.25
7,893.75
-
02/01/2020 460,127.50 -
460,127.50
473,021.25
12,893.75
20787.50
08/01/2020 5,290.00 - -
5,290.00
9,262.50
3,972.50
-
02/01/2021 465,290.00 -
465,290.00
48
18,972.50
22,945.00
Total $3,898,780.88 (3,461,285.88) $3,618,934.99
$4,056,429.99
$4,218,772.49
$162,342.50
-
PV Analysis Summary (Net to Net)
Gross PV Debt Service Savings .....................
142 783.32
Net PV Cashflow Savings @ 2.026 %(AIC) ............
142 783.32
Contingency or Rounding Amount ....................
450.43
Net Present Value Benefit
$143,233.75
Net PV Benefit / $3,408,744.36 PV Refunded Debt Service
4.202%
Net PV Benefit / $3,330,000 Refunded Principal...
4.301%
Net PV Benefit / $3,465,000 Refunding Principal..
4.134%
Refundina Bond Information
Refunding Dated Date
10/20/2010
Refunding Delivery Date
10/20/2010
10 xover Ser 05B $5.465M I Adv Ref Ser 20058 1 9/ 7/2010 1 2:51 PM
Ehlers
Chanhassen, MN
$7,930,000 G.O. Water Revenue Bonds, Series 2004B
Prior Original Debt Service
Date
Principal
Coupon
Interest
Total P +1
Fiscal Total
02/01/2011
-
-
-
-
08/01/2011
-
173,091.12
173,091.12
-
02/01/2012
-
110,876.88
110,876.88
283,968.00
08/01/2012
-
110,876.88
110,876.88
-
02/01/2013
-
110,876.88
110,876.88
221753.76
08/01/2013
-
110,876.88
110,876.88
-
02/01/2014
-
110,876.88
110,876.88
221,753.76
08/01/2014
-
-
110,876.88
110,876.88
-
02/01/2015
370,000.00
4.000%
110,876.88
480,876.88
591,753.76
_ 08/01/2015
-
-
103,476.88
103 476.88
-
02/01/2016
385,000.00
4.000%
103,476.88
488,476.88
591,953.76
08/01/2016
-
-
95,776.88
95,776.88
-
02/01/2017
400,000.00
4.100%
95,776.88
495,776.88
591,553.76
08/01/2017
-
-
87,576.88
87,576.88
-
02/01/2018
420,000.00
4.200%
87,576.88
507,576.88
595153.76
08/01/2018
-
-
78,756.88
78,756.88
-
02/01/2019
440,000.00
4.250%
78,756.88
518,756.88
597,513.76
08/01/2019
-
-
69,406.88
69,406.88
-
02/01/2020
460,000.00
4.250%
69,406.88
529,406.88
598,813.76
08/01/2020
-
-
59,631.88
59,631.88
-
02/01/2021
485,000.00
4.375%
59,631.88
544,631.88
604,263.76
08/01/2021
-
-
49,022.50
49,022.50
-
02/01/2022
505,000.00
4.400%
49,022.50
554,022.50
603,045.00
08/01/2022
-
-
37,912.50
37,912.50
-
02/01/2023
535,000.00
4.500%
37,912.50
572,912.50
610 825.00
08/01/2023
-
-
25,875.00
25,875.00
-
02/01/2024
560,000.00
4.500%
25,875.00
585,875.00
611,750.00
08/01/2024
-
-
13,275.00
13,275.00
-
02/01/2025
590,000.00
4.500%
13,275.00
603,275.00
616,550.00
Total
$5,150,000.00
-
$2,190,651.84
$7,340,651.84
-
Yield Statistics
Average Life
9.750 Years
Weighted Average Maturity
(Par Basis)
9.750 Years
Average Coupon
4.3625568%
Refundlna Bond Information
Refunding Dated Date
10/20/2010
Refunding Delivery Date
10/20/2010
Ser 04B $7.93M Wtr Rev 8d I SINGLE PURPOSE 1 9/ 7/2010 1 2:51 PM
Ehlers
Chanhassen, MN
$5,470,000 - Purpose Two
Proposed Crossover Refunding of
$7,930,000 G.O. Water Revenue Bonds, Series 2004B
Debt Service Schedule
Date Principal
Coupon
Interest
Total P +1
Fiscal Total
10/20/2010 -
_
-
02/01/2011 -
32,718.39
32,718.39
32,718.39
08/01/2011 -
-
58,310.00
58,310.00
-
02/01/2012 -
-
58,310.00
58,310.00
116,620.00
08/01/2012 -
-
58,310.00
58,310.00
-
02/01/2013 -
-
58,310.00
58,310.00
116,620.00
08/01/2013 -
-
58,310.00
58,310.00
-
02/01/2014 -
-
58,310.00
58,310.00
116,620.00
08/01/2014 -
-
58,310.00
58,310.00
-
02/01/2015 400,000.00
1.100%
58,310.00
458,310.00
516,620.00
08/01/2015 -
-
56,110.00
56,110.00
-
02/01/2016 455,000.00
1.350%
56,110.00
511,110.00
567,220.00
08/01/2016 -
-
53,038.75
53,038.75
-
02/01/2017 460,000.00
1.650%
53,038.75
513,038.75
566,077.50
08/01/2017 -
-
49,243.75
49,243.75
-
02/01/2018 475,000.00
1.800%
49,243.75
524,243.75
573,487.50
08/01/2018 -
-
44,968.75
44,968.75
-
02/01/2019 485,000.00
2.000%
44,968.75
529,968.75
574,937.50
08/01/2019 -
-
40,118.75
40,118.75
-
02/01/2020 495,000.00
2.150%
40,118.75
535,118.75
575,237.50
08/01/2020 -
-
34,797.50
34,797.50
-
02/01/2021 510,000.00
2.300%
34,797.50
544,797.50
579,595.00
08/01/2021 -
-
28,932.50
28,932.50
-
02/01/2022 520,000.00
2.450%
28,932.50
548,932.50
577,865.00
08/01/2022 -
-
22,562.50
22,562.50
-
02/01/2023 540,000.00
2.600%
22,562.50
562,562.50
585,125.00
08/01/2023 -
-
15,542.50
15,542.50
-
02/01/2024 555,000.00
2.700%
15,542.50
570,542.50
586,085.00
08/01/2024 -
-
8,050.00
8,050.00
-
02/01/2025 575,000.00
2.800%
8,050.00
583,050.00
591,100.00
Total $5,470,000.00
- $1,205,928.39
$6,675,928.39
-
Yield Statistics
Bond Year Dollars
$52,394.64
Average Life
9.579 Years
Average Coupon
2.3016255%
Net Interest Cost (NIC)
2.3851455%
True Interest Cost (TIC)
2.3814565%
Bond Yield for Arbitrage Purposes
2.1369252%
All Inclusive Cost (AIC)
2.4453474%
IRS Form 8038
Net Interest Cost
2.3016255%
Weighted Average Maturity
9.579 Years
10 xover Ser 05B $5.465M I Adv Ref Ser 2004B 1 9/ 7/2010 1 2:51 PM
Ehlers
Chanhassen, MN
$5,470,000 - Purpose Two
Proposed Crossover Refunding of
$7,930,000 G.O. Water Revenue Bonds, Series 2004B
Debt Service Comparison
Date Total P +1 PCF Existina D/S
Net New D/S
Old Net D/S
Savings
Fiscal Total
10/20/2010 -
02/01/2011 32,718.39 (32,718.39) -
-
-
08/01/2011 58,310.00 (58,310.00) 173,091.12
173,091.12
173,091.12
02/01/2012 58,310.00 (58,310.00) 110,876.88
110,876.88
110,876.88
08/01/2012 58,310.00 (58,310.00) 110,876.88
110,876.88
110,876.88
02/01/2013 58,310.00 (58,310.00) 110,876.88
110,876.88
110,876.88
08/01/2013 58,310.00 (58,310.00) 110,876.88
110,876.88
110,876.88
02/01/2014 58,310.00 (58,310.00) 110,876.88
110,876.88
110,876.88
-
08/01/2014 58,310.00 (5,208,310.00) 5,260,876.88
110,876.88
110,876.88
0.00
-
02/01/2015 458,310.00
458,310.00
480,876.88
22,566.88
22 566.88
08/01/2015 56,110.00
56,110.00
103,476.88
47,366.88
-
02/01/2016 511,110.00
511,110.00
488,476.88
(22,633.12)
24,733.76
08/01/2016 53,038.75
53,038.75
95,776.88
42,738.13
-
02/01/2017 513,038.75
513,038.75
495,776.88
(17,261.87)
25,476.26
08/01/2017 49,243.75
49,243.75
87,576.88
38,333.13
-
02/01/2018 524,243.75
524,243.75
507,576.88
(16,666.87)
21,666.26
08/01/2018 44,968.75
44,968.75
78,756.88
33,788.13
-
02/01/2019 529,968.75
529,968.75
518,756.88
(11,211.87)
22,576.26
08/01/2019 40,118.75
40,118.75
69,406.88
29,288.13
-
02/01/2020 535,118.75
535,118.75
529 406.88
(5,711.87)
23 576.26
08/01/2020 34,797.50
34,797.50
59,631.88
24,834.38
-
02/01/2021 544,797.50
544,797.50
544,631.88
(165.62)
24,668.76
08/01/2021 28,932.50
28,932.50
49,022.50
20,090.00
-
02/01/2022 548,932.50
548,932.50
554,022.50
5,090.00
25,180.00
08/01/2022 22,562.50
22,562.50
37 912.50
15 350.00
02/01/2023 562,562.50
562,562.50
572,912.50
10,350.00
25,700.00
08/01/2023 15,542.50
15,542.50
25,875.00
10,332.50
-
02/01/2024 570,542.50
570,542.50
585,875.00
15,332.50
25,665.00
08/01/2024 8,050.00
8,050.00
13,275.00
5,225.00
-
02/01/2025 583,050.00
583,050.00
603,275.00
20 225.00
25 450.00
Total $6,675 (5,590,888.39) $5,988,352.40
$7,073
$7
$267,259.44
-
PV Analysis Summary (Net to Net)
Gross PV Debt Service Savings .....................
216 058.48
Net PV Cashflow Savings nn, 2.445 %(AIC) ............
216 058.48
Contingency or Rounding Amount ....................
2,393.97
Net Present Value Benefit
$218,452.45
Net PV Benefit / $5,340,893.73 PV Refunded Debt Service
4.090%
Net PV Benefit / $5,150,000 Refunded Principal...
4.242%
Net PV Benefit / $5,470,000 Refunding Principal..
3.994%
Refundina Bond Information
Refunding Dated Date
10/20/2010
Refunding Delivery Date
10/20/2010
10 xover Ser 05B $5.465M I Adv Ref Ser 20048 1 9/ 7/2010 1 2:51 PM
Ehlers
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Debt Issuance Services
Resolution No.
Council Member
introduced the following resolution and moved its adoption:
Resolution Providing for the Sale of
$8,935,000 G.O. Water Refunding Bonds, Series 2010B
A. WHEREAS, the City Council of the City of Chanhassen, Minnesota, has heretofore determined that it
is necessary and expedient to issue the City's $8,935,000 General Obligation Water Refunding Bonds
(the "Bonds "), to provide for an advanced refunding of the $7,930,000 G.O. Water Revenue
Bonds, Series 2004B, and an advanced refunding of the $5,460,000 G.O. Water Revenue
Bonds, Series 2005B in the City; and
B. WHEREAS, the City has retained Ehlers & Associates, Inc., in Roseville, Minnesota ( "Ehlers "), as its
independent financial advisor for the Bonds 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 City Council of the City of Chanhassen, Minnesota, as
follows:
1. Authorization, Findings The City Council hereby authorizes Ehlers to solicit proposals for the sale
of the Bonds.
2. Meeting; Proposal Opening The City Council shall meet at 7:00 p.m. on September 27, 2010, for the
purpose of considering sealed proposals for and awarding the sale of the Bonds.
3. Official Statement In connection with said sale, the officers or employees of the City are hereby
authorized to cooperate with Ehlers and participate in the preparation of an official statement for the
Bonds and to execute and deliver it on behalf of the City upon its completion.
The motion for the adoption of the foregoing resolution was duly seconded by Council Member
and, after full discussion thereof and upon a vote being taken thereon, the
following Council Members voted in favor thereof:
and the following voted against the same:
Whereupon said resolution was declared duly passed and adopted.
Dated this 13 day of September, 2010.
City Clerk
30 YEAR TREND IN MUNICIPAL BOND INDICIES
Weekly Rates From September, 1980 - September, 2010
High BBI - 13.44% on 1/14/1982.
Low BBI - 3.88% on 8/30/2010.
fiLI14I90
12.00%
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
Source: The Bond Buyer
Jan 82 Jan 84 Jan 86 Jan 88 Jan 90 Jan 92 Jan 94 Jan 96 Jan 98 Jan 00 Jan 02 Jan 04 Jan 06 Jan 08 Jan 10
BBI
EHLERS
LEADERS IN PUBLIC FINANCE
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