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piity of Report Number 12-056 11113RIGHTON Agenda Section VIII-1 the city that works for you Council Meeting Date February 28,2012 REQUEST FOR COUNCIL CONSIDERATION ITEM DESCRIPTION: RESOLUTION PROVIDING FOR THE SALE OF $2,705,000 GENERAL OBLIGATION BONDS, SERIES 2012A DEPARTMENT HEAD'S APPROVAL: CITY MANAGER'S APPROVAL: No comments to supplement this report Comments attached Recommendation: To waive the reading and adopt the RESOLUTION PROVIDING FOR THE SALE OF $2,705,000 GENERAL OBLIGATION BONDS, SERIES 2012A. Legislative History: The 2012A Bonds are a combination of financing for the 2011 Street Reconstruction Improvement Project and the current refundings of the 2004A G.O. Tax Increment Bonds and the 2004C G.O. Improvement Bonds. The portion of the 2012A Bond issue to finance the 2011 Street Reconstruction Improvement Project will be $455,000. The City Council accepted the Feasibility Study for Project# 11-01, 2011 Street Reconstruction on March 22, 2011. A Public Hearing regarding the project was conducted on April 12, 2011. Authorization for preparing plans and specifications was also given on that same date. The contract was awarded on July 26, 2011. The portion for refinancing the 2004A G.O. Tax Increment Bonds will be $1,770,000. These bonds are being repaid with tax increment revenue from Tax Increment Financing Districts 7, 8, 10, 11, 12, 14, 16, 17 & 18. The remaining $480,000 of the 2012A Bonds will refinance the 2004C G.O. Improvement Bonds. These bonds were originally issued to finance the 2003 and 2004 Street Reconstruction improvement projects. The 2004C Bonds are being repaid with annual tax levies and special assessments. Financial Impact: The structure for the portion of the 2012A Bond issue for the 2011 Street Reconstruction Improvement Project anticipates using special assessments and annual City-wide tax levies to make the debt service payments on the bonds as proposed in the feasibility report. Special assessments will pay for 25% of each year's debt service payments. Annual City-wide tax levies will pay for 75%. This is consistent with the City's past practice. The future annual tax levies as structured in this bond issue will be for ten years, starting with payable in 2013 through 2022. The annual tax levies are estimated to range from $34,500 to $42,100. The amount of 2004A Bonds outstanding is $1,710,000, payable from 2013 through 2017. They have a call date of February 1, 2012, or any day thereafter. The same revenue stream from the tax increment districts will be used to repay the tax increment portion of the 2012A Bonds. The current average interest rate for the 2004A Bonds is 3.5%. The anticipated interest rate for the