HomeMy WebLinkAboutA005 - Council Action Form dated February 9, 2010 ITEM # 9 & 10
DATE: 02/09/10
COUNCIL ACTION FORM
SUBJECT: SETTING DATE OF PUBLIC HEARING AND NOTICE OF INTENT TO
ISSUE $6,600,000 ESSENTIAL CORPORATE PURPOSE GENERAL
OBLIGATION BONDS AND $90,000 GENERAL CORPORATE
PURPOSE GENERAL OBLIGATION BONDS AND ASSOCIATED TAX
LEVY FOR DEBT SERVICE
BACKGROUND:
The budget for FY 2010/11 includes General Obligation (GO) Bond funded capital
improvements. A public hearing is required to authorize issuance of bonds and the levy
of property taxes for debt to be issued. The dollar amounts and corresponding property
tax levy for the planned GO bond issue are included as part of the FY 2010/11 budget.
Though the GO Bonds and debt service levy in the FY 2010/11 budget were based on a
total issuance amount of $6,601,000, Council is asked to authorize $6,690,000 in bonds
to allow for cost adjustments, issuance costs, and bids for bonds at a premium. Bonds
will not be issued in an amount that debt service will exceed the approved debt service
levy. Council authorization will be required at a later date to authorize the sale of the FY
2010/11 General Obligation Bonds.
Separate resolutions are required for the Essential Corporate Purpose bonds in the
amount of $6,600,000 and General Corporate Purpose bonds in the amount of $90,000
since the General Corporate Purpose Bonds for improvements to City Hall are limited in
annual issuance amount and subject to a reverse referendum.
ALTERNATIVES:
1. Adopt a pre-levy resolution authorizing the issuance of Essential Corporate Purpose
General Obligation Bonds in an amount not to exceed $6,600,000 and the debt
service property tax levy to pay principal and interest on the bonds.
2. Adopt a pre-levy resolution authorizing the issuance of General Corporate Purpose
General Obligation Bonds in an amount not to exceed $90,000 and the debt service
property tax levy to pay principal and interest on the bonds.
3. Reject the pre-levy resolution authorizing the issuance of Essential Corporate
Purpose General Obligation Bonds, reduce the 2010/11 property tax levy, and delay
the capital projects.
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4. Reject the pre-levy resolution authorizing the issuance of General Corporate
Purpose General Obligation Bonds, reduce the 2010/11 property tax levy, and delay
the capital projects.
MANAGER'S RECOMMENDED ACTION:
Issuance of these bonds is necessary in order to accomplish the City's approved capital
improvements for the upcoming fiscal year.
Therefore, it is the recommendation of the City Manager that the City Council adopt
Alternative No. 1, thereby adopting a pre-levy resolution authorizing the issuance of
Essential Corporate Purpose General Obligation Bonds in an amount not to exceed
$6,600,000 and the debt service property tax levy to pay principal and interest on the
bonds.
It is also the recommendation of the City Manager that the City Council adopt
Alternative No. 2, thereby adopting a pre-levy resolution authorizing the issuance of
General Corporate Purpose General Obligation Bonds in an amount not to exceed
$90,000 and the debt service property tax levy to pay principal and interest on the
bonds.
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