HomeMy WebLinkAbout[04f] Bond Redemption
Council Agenda Item 4F
MEETING DATE:
September 18, 2014
AGENDA ITEM:
Bond Redemption – Authorize the Mayor and Administrator to execute
Resolution 2014-028 calling the 2007A GO Bonds.
SUBMITTED BY:
Finance
BOARD/COMMISSION/COMMITTEE RECOMMENDATION:
None
PREVIOUS COUNCIL ACTION:
Council issued the 2007A General Obligation Improvement
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Bonds for Jade Road, 8 Avenue, and East Side Improvements. Council approved the 2014 debt
management study presented by Monte Eastvold, Northland Securities bond advisor.
BACKGROUND INFORMATION:
The 2007A street improvement project bonds were issued with a
contingency that was not used. Part of the Jade Road project was completed for ARCON’s development
including the Kennedy Community School. ARCON was assessed their portion of the public
improvements. The assessments have been paid off, a portion with late fees. With the unused
contingency, assessment fees and other early assessment payoffs, the bond fund has a large enough fund
balance to call the bond early on December 1, 2014. The early call opportunity will result in interest
savings of $18,151. After paying off the bond, the residual bond funds (fund 341) of approximately
$214,000 will be placed in the debt service reserve fund (fund 390) and can be used for any purpose. The
Council approved using $50,000 of this money to relieve WAC/SAC fees for new owner-occupied single
family homes in 2014.
BUDGET/FISCAL IMPACT:
Interest savings = $18,151
Principal prepayment = $215,000
December 1, 2014 payment = $291,469
ATTACHMENTS:
Request for Council Action
Resolution 2014-028 Calling for the Redemption of the Outstanding General
Obligation Improvement Bonds, Series 2007A
Redemption Summary
REQUESTED COUNCIL ACTION:
Authorize the Mayor and Administrator to execute Resolution
2014-028 calling for the redemption of the outstanding General Obligation Improvement Bonds, Series
2007A.
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RESOLUTION 2014-028
CALLING FOR THE REDEMPTION OF THE OUTSTANDING
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2007A
WHEREAS:
A. The City Council of the City of St. Joseph, Minnesota issued $2,875,000 General Obligation
Improvement Bonds, Series 2007A, dated July 1, 2007; and
B. All of said bonds maturing on December 1, 2015 through 2017, inclusive, are subject to
redemption, in whole or in part, and prepayment at the option of the City on December 1, 2014, and on any
date thereafter at par plus accrued interest, all as provided in the resolution of the City authorizing the
issuance of said bonds; and
C. The City deems it desirable and in the best interest of the City to call $215,000 of the
outstanding bonds maturing in the years 2015 through 2017, inclusive, for redemption on December 1,
2014, in accordance with said resolution authorizing the issuance of said bonds, and
NOW THEREFORE, BE IT RESOLVED
by the City Council of the City of
St. Joseph, Minnesota as follows:
1. $215,000 of the General Obligation Improvement Bonds, Series 2007A, dated July 1, 2007, of
the City of St. Joseph, Minnesota, maturing in the years 2015 through 2017, inclusive, shall be redeemed
and prepaid on December 1, 2014, at par plus accrued interest for each such bond called.
2. The Finance Director is hereby authorized and directed to give mailed notice of call to the
bank where said bonds are payable and said bank shall provide such notice to the holders of the bonds as
may be required by law. Said notice shall be in substantially the attached form.
3. The Finance Director is hereby authorized and directed to deposit with the bank where said
bonds are payable prior to said call date sufficient funds to pay all principal and interest due on the bonds
as of the call date.
Adopted this day of , 2014
Rick Schultz, Mayor
ATTEST
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Judy Weyrens, Administrator
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NOTICE OF CALL FOR REDEMPTION
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2007A
DATED: July 1, 2007
CITY OF ST. JOSEPH, MINNESOTA
NOTICE IS HEREBY GIVEN that by order of the City Council of the City of St. Joseph, Minnesota, there
have been called for redemption and prepayment on
DECEMBER 1, 2014
those outstanding bonds of the City designated as General Obligation Improvement Bonds, Series 2007A,
dated July 1, 2007, having the stated maturity dates of December 1, 2015 through 2017, inclusive, totaling
$215,000 in principal amount.
Maturity Principal Amount CUSIP
2017* $215,000 790739SM9
*This is a Term Bond with mandatory sinking fund payments in 2015 through 2017.
The bonds are being called for redemption at a price of par plus accrued interest to December 1, 2014, on
which date all interest on said bonds will cease to accrue. Holders of the bonds hereby called for redemption
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, 45 South 7 Street,
are requested to present their bonds for payment to Northland Trust Services, Inc.
Suite 2000. Minneapolis, MN 55402
, on or before December 1, 2014.
Dated: September 18, 2014
BY ORDER OF THE CITY COUNCIL
/s/ Lori Bartlett_______
Finance Director
Important Notice
: In compliance with the Economic Growth and Tax Relief reconciliation Act of 2001,
federal backup withholding tax will be withheld at the applicable backup withholding rate in effect at the
time of the payment by the redeeming institutions if they are not provided with your social security number
or federal employer identification number, properly certified. This requirement is fulfilled by submitting a
W-9 Form, which may be obtained at a bank or other financial institution.
Additional Information may be obtained from:
NORTHLAND SECURITIES, INC.
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45 South 7 Street, Suite 2500
Minneapolis, Minnesota 55402
Attn: Lori A. Giampaolo
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