Bond bids for city less than estimatedThe Alexandria City Council received some good news at its meeting Monday evening. Not only did two bonds come in considerably lower than estimated, but the city was also upgraded in its bond rating.
By: Tara Bitzan, Alexandria Echo Press
The Alexandria City Council received some good news at its meeting Monday evening. Not only did two bonds come in considerably lower than estimated, but the city was also upgraded in its bond rating.
Terry Heaton of Springsted, Inc. presented bids for the sale of two bonds. The first was a $2,030,000 Series 2009B taxable general obligation improvement bond for the Phase III Orderly Annexation Area waterline.
Five bids were received representing 13 financial institutions and ranging between 2.89 and 2.99 percent. The bid was awarded to UMB Bank, N.A. at 2.89 percent.
The second was a $1,700,000 Series 2009C taxable general obligation capital improvement bond for the park department building. Three bids were received, with the low bidder being Northland Securities at 3.53 percent.
Heaton explained that all are Build America Bonds, which were developed under the Reinvestment Act of 2009 to provide funding for state and local governments at lower borrowing costs, enabling them to pursue necessary capital projects.
Build America Bonds are designed to provide a federal subsidy for a larger portion of the borrowing costs of state and local governments than traditional tax-exempt bonds in order to stimulate the economy and encourage investments in capital projects in 2009 and 2010.
The first bond bid came in $56,000 less than estimated, while the second was about $42,000 less than estimated.
Both low bids were approved by the council.
Heaton then shared more good news, informing council members that the city was upgraded from an “A” credit rating to an “Aa” rating. The ratings are used to indicate the degree of risk associated with a government entity’s credit. Rating levels include Aaa, Aa, A, Baa, Ba, B, Caa, Ca and C and reflect economic stability, financial operations, reserves, debt profile, etc. Double A ratings are reserved for entities determined to be a “safe” investment with a low risk of failure.
Heaton said Alexandria was upgraded because of its recognition as a regional trade center, its strong tax base, moderate overall debt, solid financial situation, three consecutive years of surpluses and for conservatively projecting a break-even general fund.
The improved rating means a reduced bond interest rate.
Heaton presented the council with a plaque acknowledging the upgrade in status.
Other council action
In other action, the council:
• Proclaimed the week of October 19-23 as National Business Women’s Week.
• Approved a request from Jefferson High School to hold a homecoming parade on Saturday, September 26. The route will begin at the Douglas County Fairgrounds, move east on 5th Avenue and conclude at the high school.
• Reviewed correspondence from Lakes Area Recreation (LAR) stating that it will not participate in funding efforts to build outdoor field space at the YMCA due to LAR field needs being resolved.
• Approved a request from Douglas County Public Works to hire a Level I street maintenance worker with a projected start date of October 5.
• Approved a request from Ben Zacher of Silver Maple Investments, LLC for a partial mortgage release for a mortgage granted under the city’s revolving loan program. The original $50,000 loan was granted in 2002 for improvements to the former Fleet Farm building. The current loan balance is approximately $30,000. Zacher plans to split off the south 22 feet of the property and transfer ownership to Juettner Motors.
• Was informed that City Administrator Jim Taddei was contacted by Douglas County Auditor/Treasurer Tom Reddick on behalf of the Douglas County Board of Commissioners to request discussion of the scheduling of the proposed law enforcement center. A motion was passed by the council to give the county a deadline of October 1 to opt in or out of a joint law enforcement facility.
• Was given information from City Attorney John Lervick in regards to Maritime Museum’s interest in using land to the north of land currently leased from the city for special functions. Lervick recommended the city not encumber the property with a long-term lease commitment but rather consider a memorandum of understanding allowing the museum to use the property on occasion. As no formal request has yet been made, no action was taken.
• Approved a request by the Alexandria Housing and Redevelopment Authority (HRA) for operational funds according to Minnesota Statute 469.033 that allows HRAs to levy a tax of .0185 percent of the taxable market value of property located within the city limits. The tax levy request for 2010 is $207,078.
• Commended HRA director Jeff Hess for recently receiving an Outstanding Achievement Award. He was selected by his peers from throughout the state for the honor.
• Adopted a resolution to accept a grant from MnDOT to upgrade the sanitary sewer and parking lot at the airport.
• Adopted a resolution authorizing issuance of a loan and executing the loan agreement for funding for Alexandria Light and Power from the Public Facility Authority for expansion of the water treatment plant.
• Scheduled the final assessment hearing for the Part 1A and Part 1B waterline project for the Phase III annexation area on Tuesday, October 13 at 7:30 p.m.
• Made a motion to rescind a section of the city code that relates to special use vehicles in the city limits. The motion failed for lack of a second.
• Approved amendment of an ordinance on wind energy conversion systems as recommended by the planning commission.
• Approved a ground lease for Life Link III of St. Cloud. Watch Friday’s Echo Press for more information.