5. Community Center Task Force update I
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CITY OF _.....___
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., CHANHASSEN
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4:-^-;: 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
' (612) 937-1900
IMEMORANDUM
TO: Mayor and City Council
IFROM: Don Ashworth, City Manager
DATE: January 9, 1989
ISUBJ: Community Center Task Force Update
ISince the creation of the Community Center Task Force in July
of 1988 , the group has looked at the options available to the
city for the location of a community center. The first option
I
that came to light is located on the City Center Park site and
adjacent to the Chanhassen Elementary School. Attached, please
find a site plan. The second alternative is a site located next
Ito Lake Ann Park, currently owned by Eckankar. Tentative cost
estimates for each site are also attached.
I The Community Center Task Force feels that the facts on each site
have been gathered and that the next step in the process would be
to get public input. They are proposing to hold public meetings
to get feedback from the residents on each of the alternatives .
IWe anticipate members of the Task Force 1:o be present on Monday
evening, thus this item appears under visitor presentations .
I This report is simply to update you on the current activities of
the group.
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MEMORANDUM
TO: Don Ashworth, City Manager
Lori Sietsema, Park and Recreation Coordinator
Community Center Task Force
FROM: Jim Mady ,
DATE: January 4 , 1989
We have now been working on this project for seven months . I
believe it is time to agree on the facts concerning the two loca-
tions being studied and the financing available.
Financing Ability '
As of 1988, the City has the ability to sell $2 ,000,000 in bonds
which would be paid back using the existing mill levy, that is, 1
no tax increase. The City' s legal bonding limit will increase at
a rate of $500 ,000 per year through the year 1995 . If we were to
use this increase in bonding ability, the mill levy would have to
be increased, that is, a tax increase. The following table shows
the tax effect on homes in Chanhassen with assessed values of
$100 ,000 and $150 , 000 .
Tax Effect
Bonding $100,000 $150 ,000
2 ,000,000 -0- -0-
2 ,500 ,000 21 35
3 ,000,000 42 70
3 ,500 ,000 46 77
4 ,000,000 63 105
4 ,500 ,000 63 105
5 ,000 ,000 84 140
5 ,500 ,000 94 157
If the Community Center is not built, the city could reduce pro-
perty taxes approximately $45 per year on a $100 ,000 assessed
value home. The City also has the option of continuing to
collect this tax money and use it to retire existing debt more
quickly.
Due to a provision in the State law dealing with tax increment
districts, the City has an opportunity to work with the Chaska
School District on a financing option. The excess school tax
levy assessed on the tax increment district which was passed by
the voters in the spring of 1988 can be used to pay off bonds
that benefit both the School and the City. These would also not
affect the City' s legal bonding limit. The School Board has
indicated an acceptance of pursuing this idea. The funds
available would allow the sale of $1 ,500,000 worth of bonds in
addition to any bonding the City can undertake on its own.
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IIJanuary 4 , 1989
Page 2
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IEckenkar Site
Costs Amount
Land - 10 acres $450,000
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Utilities, water, sewer, roads 444,000
Ice Arena 851 ,000
Gym 601,000
1 Racquetball, control 917,000
Pool, support 570,000
Parking 140 ,000
II subtotal $3 , 973 ,000
Inflation - 4% per year 795 , 000
total cost $4,768 ,000
I Because the sharing of the excess school tax levy may not be
available at the Eckenkar site, the City would then have to bond
the entire amount itself. This would not be available until
I 1994 . This brings in the inflation adjustment of four percent
per year or an increase in the construction cost of almost
$800 ,000 . It would be necessary to increase taxes on a home with
Ian assessed value of $100 ,000 by $84 per year.
City Center/Elementary School Site
I Costs Amount
Land - already available -0-
Utilities - on site -0-
I Ice arena
Gym $851,000
601, 000
Racquetball, control 917, 000
Pool, support 570 ,000
I Specialty classrooms * 251 ,000
Parking 96 , 000
Playfield changes 20,000
I Inflation - 4�ubt sotal $3 ,306 ,000
-0-
total cost $3 ,306 , 000
I * not included in the Eckenkar site
As the entire cost is immediately bondable through use of both �'
the City' s bonding ability and the use of the school districts
I excess levy on the tax increment district, there is no need for
an inflation adjustment. No tax increase is necessary to finish
this option.
A third idea has surfaced which would require the school district
to commit to build a middle or high shcool on the Eckenkar site.
I The City would purchase the southern 1/3 of the parcel, 70 acres,
and give the land to the school district to build its school. We
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January 4 , 1989
Page 3
would share facilities to the extent possible and build the
remaining Community Center facilities . This option would allow
for the use of the excess school tax levy from the tax increment '
district. Costs are not known at this time and staff from both
the School and the City are reviewing the idea. Concern exists
as to whether Eckenkar would be willing to sell a significant
portion of the parcel and what the cost would be. One task
force member has indicated that Eckenkar has turned down recent
cash offers of $2,800 ,000 for this land.
Finally, the newest portion of Lake Ann Park has been discussed.
This parcel has two serious drawbacks . It already has been
approved by the voters to construct badly needed ballfields and
parking areas on this site. Sewer and water will not be
available on this site until the year 2000 .
Other concerns and points have been discussed including safety, 1
expandability and operating budget. It is believed that the
facility as proposed would handle a population of thirty-five
thousand (Chanhassen estimtes that its population will grow to
16 ,000 by the year 2000) . The facility would generate sufficient
revenues to cover all operating expenses based on information
supplied by the Eden Prairie Community Center and the Minnetonka
Ice Center .
I believe the information presented herein accurately reflects
our discussions to date. I feel it is time to start public
discussion of the various proposals . In order to do this, we
must have a firm basis to begin. The facts as presented here
along with other information available should allow for a good
beginning of this task.
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COMMUNITY CENTER TASK FORCE MEETING MINUTES
DECEMBER 21, 1988
' Members Present: Tom Akins, Jim Mady, Ursula Dimler, Brad
Johnson, Colleen Klingelhutz , Bob Robinett, Bill Boyt and
Bob Ostlund.
' Call to Order: The meeting was called to order at 7: 45 p.m. by
Chairman Jim Mady.
' Debt Limitations - Community Center: Don Ashworth reviewed his
memorandum of December 20 , 1988 . Issues presented at the last
Task Force meeting generated discussion over differences between
' "legal debt capacity" versus "existing debt capacity" . The com-
mittee had also asked what tax implications might be if the City
exceeded existing debt standards . Various questions were raised;
however, the report appeared to be generally understood.
Committee member Bill Boyt suggested that the minutes reflect
that the statistics within the report had been prepared by the
City' s financial advisor, Andy Merry.
' Don Ashworth stated that Mr. Ostlund was present to respond to
questions occurring at our last meeting regarding the school
district' s interest in the community center proposal and poten-
tial funding concepts. One of the funding concepts presented at
the last meeting was the ability to use tax increment revenues as
a part of the project. The possibility of this funding source
has occurred as a result of the 1988 change in State law.
Specifically, the legislature placed into Statute a section
attempting to stop Housing and Redevelopment Authorities from
' gaining an undue "windfall" because of "excess levy referendums
of school districts . " Specifically, property values existing
within a tax increment district continue to be spread between
' County/City/school district. However, new values created as a
result of new construction are channeled to the HRA who has sup-
posedly calculated the proposed taxes from those new facilities
and will only be capturing the amounts necessary to pay for the
roads/sewers/structures demolished to carry out such redevelop-
ment. As the mill rate charged against the new development is
exactly the same as for all other properties within the com-
munity, an excess levy referendum for school purposes hypotheti-
cally produces a "windfall" for the local HRA. It was this
loophole the legislature wished to fill and, again, established the
' language in the statutes stating that those windfall dollars
would be calculated separated by the County Auditor' s Office and
forwarded to the school district over and above the amounts
levied by the school district for general school purposes
' [ therefore, now producing a windfall for the school district] .
However, the legislature also made one exception - if a city
wants that excess levy money, it can keep it.
' The change in state law will in all likelihood create a myriad of
school district/city battles throughout the state. Recognizing
' this potential, the city and school started working several
months ago trying to determine how best to address this issue
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COMMUNITY CENTER TASK FORCE MINUTES
DECEMBER 21, 1988
Page 2
without creating potential battle lines. One of the concepts '
considered was the possibility of both the City and the school
district agreeing that certain projects may benefit both the
school and community, i .e. community center, gymnasium, etc.
A new gymnasium or community center could be beneficial to both
the City and school . The above statements had been made by Don
Ashworth at the last meeting and, again, the members had
requested that Mr. Ostlund be present to provide his thoughts on
the subject.
Mr. Ostlund stated that the school board was positive in its '
reaction to the proposed community center adjacent to the elemen-
tary school. That presentation was made prior to the time that
the committee prepared the Lake Ann option and, accordingly,
reaction to that proposal has not yet occurred. Secondarily, the
board has only briefly reviewed the concept of using excess levy
revenues ( tax increment windfall dollars) for joint City/school
purposes . The concept has been presented and seems to be
receiving very favorable review. Specifically, the City of
Chaska has approached the school district with exactly that same
proposal as it would relate to the construction of a community
center in the City of Chaska. Although the discussions with
Chanhassen has occurred for a longer period of time than in
Chaska, it appears as though their proposal is moving more
quickly and, as a result, it was the Chaska proposal which was
reviewed by the school board. Again, that proposal appeared to
receive a lot of positive interest with very few negatives being
brought to the forefront. The Chaska proposal appears to be one
of having the City release its tax increment dollars to the
school district, having the City carrying out the construction of
the community center, and receiving a pledge from the school
district to make payments back to the City equal to the amount
distributed to the school by the County Auditor. Again, no
votes were taken on the issue and significant legal/technical
work will be required to be completed before a specific proposal
can be voted upon. Again, the proposal did receive a favorable
review and Chaska was encouraged to define such further . Mr.
Ostlund did not know of any reason why a similar proposal would
not be received well by the school board for Chanhassen and that
all of the discussions to date between the school representatives
and City staff have generally been along the same lines as that
proposed by Chaska.
Brad Johnson asked what amount of money may be generated from tax
increment excess levies. The Manager responded that such would
be approximately $1 ,500 ,000 which would equate to approximately
$1, 000 , 000 in construction dollars . The Manager noted that the
dollar amount could be higher depending on the number of years ,
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COMMUNITY CENTER TASK FORCE MEETING MINUTES
' DECEMBER 21, 1988
Page 3
' being pledged. The Manager also noted that the December 20 , 1988
report regarding availability of construction dollars did not
include the dollars which may be available from tax increment
revenues . Mr. Johnson stated that he felt that this was an
important point and should be included in the minutes, i .e.
should voters decide that a community center is desirable, then
' approximately 3 million dollars would be available without
increasing property taxes (assumes tax increment revenues would
be available) , and that such referendum could state that
$5 ,000,000 could be available in the next five-year period of
time. Further that if the City did tax for that full $5 ,000 ,000
program that such would not increase taxes more than $60 to $100 .
If the project were scaled back to a $4,000,000 level that the
taxes would be about $40 to $70 in homes ranging from $100,000 to
$150, 000 in market value.
Chairman Mady stated that the Park and Recreation Commission
feels a strong need to complete at least a portion of the trail
system. Given the last defeat, the Commission would probably not
come back with a full-blown trail system; but, instead limit such
to major roadways , i .e. County Road 17 , Highway 101, Minnewashta
Parkway, etc. Mr. Mady did not know the specific amount that may
be needed for such trail construction but would sincerely ask
' that the Community Center Task Force to not take a position which
would totally deplete or leave no monies available for trail
construction. Leaving about $300 ,000 of unused legal debt capa-
city would assure support from people within the community still
desiring a trail system.
The Commission generally discussed whether a report should be
' presented to the City Council in January. Work activity
currently being scheduled for the January City Council agenda may
preclude that from occurring. Additionally, members appeared to
' be skeptical of attempting to present a full presentation given
the vagueness of each of the two proposals . If the City Council
wished for some form of update or generalized report, such should
' be considered by the Manager.
Adjournment: The meeting adjourned at 9 : 45 p.m.
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CITY OF
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CHANHASSEN
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690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
(612) 937-1900
MEMORANDUM
TO: Community Center Task Force
FROM: Don Ashworth, City Manager I
DATE: December 20 , 1988
SUBJ: Debt Limitations - Community Center '
At our last meeting the Commission had requested additional
information regarding debt limitations and tax implications for
the construction of a new community center. The debt limitation
issue concerned me as a complete analysis would require a "debt
study" , potentially by the City auditor' s office, at a cost of
$3 ,000 to $5 ,000 . I stated that I would attempt to obtain the
information being requested in a more cost efficient manner. A
secondary source of providing that information was through our
financial bond consultant, Andy Merry. Given the number of end-
of-year sales being brought to the market, Andy' s schedule has
been quite demanding. To expedite the process, I did meet with
Andy, reviewed all debt schedules/statistical reports, and pre-
pared this memorandum to serve as the conclusions of that
meeting. Mr. Merry has received a copy of this report and has
stated that such does represent the conclusions reached at our
meeting.
Overview '
Elimination of tax levies for the bonds of 72/73 as well as
reduced levies for the bonds of 1983 has produced the resources
to insure that the bonds approved in early 1988 would not create
a tax increase (see Exhibit A) . The 1988 referendum included
parks in southern Chanhassen ($300 ,000 ) , Lake Ann Park expansion
( $300 ,000 ) , and Fire Station enlargement/aerial truck ( $1 ,400 ,000 ) .
$1 ,250 ,000 of the $2 ,000 ,000 approved was sold in 1988 to insure
funds were available for the Fire Station construction. The
remaining $750 ,000 is proposed to be sold in 1989 when monies are
proposed to be expended for the remaining projects. The prin-
cipal and interest associated with each of those two sales is
also shown on Exhibit A. The approximate $200 ,000/year required
to fund the two issues ( bonds of 1988 and 1989 ) is less than the
previous $210 ,000 to $230 ,000 required for the bonds of 72/73 and
bonds of 1983 . Accordingly, there was no tax increase, nor will
there be for the $2 ,000 ,000 authorized in 1988 . ,
Community Center Task Force
December 20 , 1988
Page 2
Debt Capacity
There are two ways to look at debt capacity, i .e. Legal Debt
Capacity and Existing Debt Limitations. The following explains
each of these:
Legal Debt Capacity - Exhibits B and C show -the calculations
used by the City Auditor and approving attorneys in deter-
mining "legal debt capacity " . The auditor ' s report shows
' that approximately $3,000 ,000 in debt margin existed in 1986
with such increasing to $3,500 ,000 in 1987 . Neither of the
two reports reflect the $2,000 ,000 in general obligation
bonds sold in 1988 . The bond sale in 1988 used the debt
capacity figures from 1987 and, accordingly, the bonding
attorney would not approve any general obligation issue which
exceeded approximately $1 ,500 ,000 . At time of completion of
the 1988 audit (March/April, 1989 ) it is anticipated that the
legal debt margin would have increased to approximately
$2 ,000 ,000 . Based on existing growth rates and the amount of
existing debt currently being retired each year, it is reaso-
nable to assume that the legal debt margin would continue to
, increase by approximately $500 ,000 per year during the years
of 1989 through 1995. Again, any additional debt incurred
' during that timeframe would have to be subtracted from debt
calculations. It should be noted that debt obligations for
tax increment bonds , development bonds (Rosemount and Lyman
' Lumber) , and special assessment bonds are not considered in
determining the legal debt limitation of a City.
° Existing Debt Limitation - Over the past several years the
' City has operated under the self-imposed restriction of not
exceeding 8 mills to pay debt service in any one year . The
"mill levy" is a number which represents the total dollars
needed by a particular unit of government or for all units
divided by the assessed value (value of property) in the com-
munity. Currently the City has an assessed value ( total
value of all property in the community) of approximately
$70 ,000 ,000 . The amount of money needed by the City to
operate all general government functions (police, fire, etc. )
is approximately $1 , 300 , 000 . Accordingly, the City levies
approximately 19 mills to operate City government. The
amount of money a mill produces will continue to increase as
the total value of all property in the community increases .
' To date, the City has needed approximately 8 mills to meet
existing debt obligations . There has been concern as to the
relatively high tax rate within the City. The City cannot
take full responsibility for tax levels as the City' s 27
mills (19 general government plus 8 debt) represents approxi-
mately 20% of the taxpayers property tax bill . However, the
City ' s portion of the mill rate is still high in comparison
' to other metropolitan cities. It is the City' s debt portion
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Community Center Task Force
December 20 , 1988
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of the levy which produces that higher position, i .e. if the I
City' s debt levels were closer to metropolitan averages, the
City as a whole would also be at the metropolitan average. I Other than the "Legal Debt Margin" there is no other limita-
tion set upon the City in terms of the amount that can be
expended for debt purposes.
If the City were to continue to maintain the self-imposed II
debt limitation of 8 mills, the City would be able to fund
approximately $2 ,000 ,000 in additional debt without creating I
a tax increase. This number can be seen on Exhibit A. The
number shown is $2 , 996 ,000 (bottom right-hand corner) ;
however, that number needs to be decreased for interest II thus producing the approximate $2 ,000 ,000 available for
actual construction. The timeframe being considered for
incurring that debt would be the timeframe of 1989 through
1995 .
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Tax Implications
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Legal
Legal 1988 Available 8 Mills Debt Estimated Tax
I
1 Deot Debt for new Debt Over Assessed Implications
Capacity (1) Construction (2) Available Value (3)
1988 $4.0M - $2.0M - $2.OM - $ 2.OM $ -0- $ 70M -0-
I
1989 4.5 2.5 .5 80 $21m - $35M
1990 5.0 3.0 1.0 95 42 - 70
1991 5.5 3.5 1.5 103 46 - 77
1992 6.0 4.0 ' 2.0 111 63 - 105
1993 6.5 4.5 2.5 115 63 - 105
1994 7.0 5.0 3.0 119 84 - 140 I
1995 7.5 - $2.0M 5.5 - $ 2.OM $ 3.5 $122M $94 -$157
1. 52,000,000 debt approved in 1988 to be sold as Bonds of 1988 ($1,250,000) and Bonds of
1989 ($750,000). I
2. Debt which can be funded within existing 8 mill levy.
3. This is the additional taxes to be paid annually by homes between $100,000 and $150,000 in
market value. i
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111111 MI. NI 11111111 MN -1111111 • MI 11M1 r L
t,. BEET ANALSIS - SUMMARY REPORT Last Update: 30-Sep-88
INCLUDES ALL SPECIAL ASSESSMENT,GENERAL OBLIGATION, EQUIPMENT CERTIFICATE 11:45 AM
AND TAX INCREMENT BONDS (ALL DEBT) Date Appr'd: ~
ACTUAL (----(---!----)---->----> PROJECTED
1906 1987 1989 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 TOTAL
l
PSC'*ESTY T.%X LEVIES -
4'''' 111f111t IIIIi(111I11111
!„ SPECIAL ASSESSMENT FUNDS
Bonds of 1997211973 150,000 1500,000 150,000 150,000
Revised 72'73 (75,0000) (75,000) (150,000) t
Ref. Goods cf 1978
Bonds of 1763
Sef. Bonds of 1933 60,000 $80,000 $20,000 $80,0000 $80,000 $85,000 $85,000 $95,000 $90,000 $85,000
A,. Revised 63 ($90,000) ($00,000) ($90,000) ($80,000) ($95,000) ($05,000) ($35,000) ($90,000) ($85,000)
Bonds of 1984 $35,000
Bonds of 1925
Total Levy 140,000 142,000 143,000 145.00;(' 2 2
Total
Collections T, TT' , 148,000 165,000 170,000 170,100 175,000 45,000 65,000 280,000 295,000 310,000 525,000 570,0100 55,066 ;,'55,000
Bands of 1987
(33,000) 1.33,000) )35,000) (35,000) (15,000) (35,000) (35,000) (35,000) (35,000) (35,000) (35,0001 (35,000) (35,000) (35,000) (35,000) (35,0s,01 135,0,0) 1591.000) -
A.� Bonds of 1935
0
Bards of 1929
ly
BUS-90900 21',000 190,000 225,000 113,000 113,000 113,000 130,000 135,000 135,000 140,000 210,000 230,000 245,000 260,000 275,000 490,000 535,000 20,000 3,769,000 r
GENERAL OBLIGATION DEBT
m4EC 11,7,0 11,300 11,360
�_;. 73,900
( . Bloq 0o"es 140,10'' 149,900 151,30) 153,400 155,100 156,500 162,700 173,400 177,600 186,300 193,700 199,700 204,400 207,800 215 000
1990 Fire/Equip Fonds � 2,631,9(W
130,000 115,000 110,000 135,000 135,000 130,0000 150,000 150,000 140,000 160,000 155,000 175,000 165;000 180,000 170,0000
1989 Park Bonds 91,000 20,5000 77.000 500 94,500 94 91 000
s ,` 91,000 105,000 105,0000 98,000 112,000 108,500 122,500 115,500 126,000
(s
Sub-Total Sen. Oblig 157,400 160,200 162,600 283,400 361,100 347,000 374,700 402,900 402,100 427,300 448,700 444,700 462,400 474,800 498,500 287,500
�' EDL'IF:E1T C 001E
ICATES
Existing Equip. Cert. Eo,500 137,630 176,500 223,5(0 212,000 54,000 0
Equip. Renal Cert. 0 0 0 50,000 55,000 240,000 250,000 260,000 270 000 7 890,130
280,000 290,000 300,000 310,000 320,000 330,000 340,000 356,000
TAX INCREMENT FADS 0 0 0 0 0 0 0 0 .r
0 U 0
ty TOTAL TAX LEVIES 453,900 ' ' '
, 497,830 554,100 619,900 736,100 569,000 744,700 787,400 797,100 837,300 938,700 964,700 1,007,400 1 044 800 1,093,500 1,101 500 1,170,500 665,000 7,324,430 r'
(y RETYIFED DEBT LEVY 8.17 7.83 8.09 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 9.00 8.00
OPERATIONAL LEVY 20.20 18.53 18.58 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 19.00 .4
TOTAL PROJECTED LEVY 28.37 26.36 26.67 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00
1I ASSESS'D 'VALU4TION 55.557 62.321 69.792 80.261 95.992 103.563 111.849 1(5.204 118.660 122.220 125.887 129.663 133.553 137.560 141.686 145.937 150.315 154.925 smi
(Millions)
453901 487973 564617 642086 767137 829508 894798 92(632 949281 977759 1007092 1037305 1068424 1100477 1133491 1167496 1202521 1238596
1 143 517 22186 31037 259508 150088 133732 152181 140459 68392 72605 61024 55677 39991 59996 32021 572596 2.996,696
Le
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CITY OF CHANFFASSEN, tIINNESOTA
NOTES TO FINANCIAL STATEMENTS Page 13 of
December 31, 1986
Note 2 - DETAIL NOTES ON ALL t
FUNDS AND ACCOUNT GROUPS (Continued)
PRIOR YEAR DEFEASANCE OF DEBT I
In prior years, the City defeased certain General Obligation Bonds by placing
proceeds of new bonds in an irrevocable trust to provide for all future debt
service payments on the old bonds. Accordingly, the trust account assets and
the liability for the defeased bonds are not included in the City's financial
statements. At December 31, 1986 $7,755,000 of bonds are considered defeased.
The financial transactions of the escrow account are not presented in the
• financial statements. A summary of the 1986 activity, however, is presented i
Exhibits 10, 11 and 12 of the Supplementary Financial Information Section.
LEGAL DEBT MARGIN
IIThe City is subject to a statutory limitation by the State of Minnesota for
bonded indebtedness payable principally••from property taxes. The City of
Chanhassen's legal debt margin for 1986 and 1985 is computed as follows:
December 31, II
1986 1985
Assessed value (after fiscal disparities
II
and tax increment) $62,821, 505 $55,557,525
Debt limit (7-1/3% of assessed value) $ 4,606,700 $ 4,074,033
II
It
Amount of debt applicable to debt limit:
Total bonded debt $19,304,621 $16,134,621
Less: Special assessment bonds and
II
tax increment bonds 17,589,621 14,499,621
Less: Cash and investments in
debt service funds 180,092 130, 107- II
Total debt applicable to debt limit $ 1, 534, 908 $ 1, 504,893
Legal debt margin $ 3,071 , 792 $ 2, 569, 140 II
• Legal debt margin is calculated on general obligation bond issues only
this does not include Special Assessment, Revenue/Enterprise Fund or tax lincre-
ment bonded debt).
':
+!y
DEFERRED REVENUE "'
Deferred revenue as of December 31 , 1986 consisted of grant advances as
lifollows:
LCMR $ 21, 498
I!
CDBR 8, 159
Total $ 29,657
•
&TeAi‘ii- 23
IF : '' ' :
CITY OF CHANHASSEN, MINNESOTA
II NOTES TO FINANCIAL STATEMENTS
December 31 , 1987 Page 15 of 33
IINote 2 - DETAIL NOTES ON ALL FUND AND ACCOUNT GROUPS (Continued)
IICITY INDEBTEDNESS (Continued)
In 1988 the City acquired a portion of the outstanding current interest bonds
I . with a matured value of $220,000 and a maturity date of August 1 , 1995. The
City paid $130,889 to effectively retire such obligations. The above schedule
has not been adjusted for this 1988 transaction.
IIPRIOR YEAR DEFEASANCE OF DEBT
In prior years, the City deceased certain General Obligation Bonds by placing
I proceeds of new bonds in an irrevocable trust to provide for all future debt
service payments on the old bonds. Accordingly, the trust account assets and
I the liability for the defeased bonds are not included in the City's financial
statements. At December 31, 1987, $7,380,000 of bonds are considered defeased.
The financial transactions of the escrow account are not presented in the
II financial statements. A summary of the 1987 activity, however, is presented in
Exhibits 10, 11 and 12 of the Supplementary Financial Information Section.
1
II LEGAL DEBT MARGIN
The City is subject to a statutory limitation by the State of Minnesota for
bonded indebtedness payable principally from property taxes. The City of
IChanhassen's legal debt margin for 1987 and 1986 is computed as follows:
December 31 ,
IAssessed value (after fiscal disparities 1987 1986
and tax increment) $69,313,016 $62,821 ,505
IIDebt limit (7-1/3% of assessed value) $ 5,082,954 $ 4,606,700
Amount of debt applicable to debt limit:
I Total bonded debt $25,874,621 $19,304,621
Less: Special assessment bonds and
tax increment bonds 24,129,620 17,589,621
1 Less: Cash and investments in
debt service funds 177,218 180,092 r-
' Total debt applicable to debt limit $ 1 ,567,783 $ 1 ,534,908
Legal debt margin $ 3,515,171 $ 3,071 ,792
IILegal debt margin is calculated on general obligation bond issues only (i.e. ,
this does not include Special Assessment, Revenue/Enterprise Fund or tax incre-
II ment bonded debt) .
II
CITY OF CHANHASSEN, MINNESOTA ,X 4 a,‘,/1• ' ,
Page 13 of. 2,
NOTES TO FINANCIAL STATEMENTS
December 31, 1986
Note 2 - DETAIL NOTES ON ALL ,
FUNDS AND ACCOUNT GROUPS (Continued)
PRIOR YEAR DEFEASANCE OF DEBT I
In prior years, the City defeased certain General Obligation Bonds by placing
proceeds of new bonds in an irrevocable trust to provide for all future debt
service payments on the old bonds. Accordingly, the trust account assets and
the liability for the defeased bonds are not included in the City's financial
statements. At December 31, 1986 $7,755,000 of bonds are considered defeased.
The financial transactions of the escrow account are not '
financial statements. A summary of the 1986 activity, however,Itis presented i
Exhibits 10, 11 and 12 of the Supplementary Financial Information Section.
LEGAL DEBT MARGIN
The City is subject to a statutory limitation by the State of Minnesota for
bonded indebtedness payable principally from property taxes. The City of
Chanhassen's legal debt margin for 1986 and 1985 is computed as follows:
December 31, II
1986 1985
Assessed value (after fiscal disparities I
and tax increment) $62,821,505 $55,557,525
Debt limit (7-1/3% of assessed value) $ 4,606,700 $ 4,074,033 II
II
Amount of debt applicable to debt limit:
Total bonded debt $19,304,621 $16,134,621
Less: Special assessment bonds and II tax increment bonds 17,589,621 14,499,621
Less: Cash and investments in
debt service funds 180,092 130, 107 II
Total debt applicable to debt limit $ 1, 534, 908 $ 1, 504, 893
Legal debt margin $ 3,071 , 792 $ 2, 569, 140 II
Legal debt margin is calculated on general obligation bond issues only (i.e. ,
this does not include Special Assessment, Revenue/Enterprise Fund or tax incre-
ment bonded debt).
II
DEFERRED REVENUE
Deferred revenue as of December 31 , 1986 consisted of grant advances as
follows:
i
LCMR $ 21,498 '1
CDBR 8, 159 i
Total $ 29,657
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