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07. Staff Report - 2024 Street Project Public Hearing
Staff Report
Date of Meeting: March 19, 2024
For: Honorable Mayor and Council
From: Kyle Morell, City Administrator
Subject: Public Hearing – 2024 Street Improvement Bond Issuance
Background:
At last month’s meeting, the Council set March 19 as a public hearing date to approve a street
reconstruction plan and review proposed bond details. Jason Aarsvold, who presented to the
Council, will return to aid with the public hearings.
Issue:
Two public hearings are scheduled, and three resolutions are before you for approval, with the
following sequencing of actions:
1. Hold the Public Hearing for the Street Reconstruction Plan and issuing bonds for the purpose of
financing the 2024 Street Improvement Project described by the Plan;
2. Consider adopting the Resolution Adopting the Street Reconstruction Plan;
3. Hold the Public Hearing for the Tax Abatements;
4. Consider adopting the Resolution Approving the Tax Abatements and
5. Consider adopting the “Pre-Sale” Resolution for the bond issuance.
The resolutions in question are attached.
Options:
1) Approve Resolutions are presented
2) Table for further discussion
Recommendation:
Option 1
Attachments:
Pre-Sale Report prepared by Ehlers
Resolution 03-19-24-02 – Adopting Street Reconstruction Plan and Approving Issuance of
Bonds
Resolution 03-19-24-03 – Approving Tax Abatements
Resolution 03-19-24-04 – Pre-Sale Resolution - $4,135,000 GO Bonds
March 19, 2024
PRE-SALE REPORT FOR
City of Scandia, Minnesota
$4,135,000 General Obligation Bonds, Series 2024A
Prepared by:
Ehlers
3060 Centre Pointe Drive
Roseville, MN 55113
Advisors:
Jason Aarsvold, Senior Municipal Advisor
Todd Hagen, Senior Municipal Advisor
Schane Rudlang, Associate Municipal Advisor
BUILDING COMMUNITIES. IT’S WHAT WE DO.
Presale Report
City of Scandia, Minnesota
March 19, 2024
Page 1
Proposed Issue:
$4,135,000 General Obligation Bonds, Series 2024A
Purposes:
The proposed issue includes financing for the following purposes:
2024 Street Improvement Project ($3,480,000): Debt service will be paid from ad
valorem property taxes.
2024 Crack Fill & Seal Coat Project ($655,000): Debt service will be paid from tax
abatement revenues.
Authority:
The Bonds are being issued pursuant to Minnesota Statutes, Chapters:
469 – Tax Abatement
475.58, subd. 3b – Street Reconstruction and Bituminous Overlays
475 – General Bonding Authority
Under the Tax Abatement Authority, the amount of property taxes abated in any year for the
Bonds, together with any outstanding annual abatements, may not exceed: (1) 10% of the
City's net tax capacity (“NTC”), or (2) $200,000, whichever is greater. The City’s NTC is
$11,057,558, leaving a maximum allowable annual abatement of $1,105,755. The projected
average annual abatement for the Bonds is $56,450. Therefor, the City will have over
$1,049,305 of remaining annual abatement authority. The City will hold the required Tax
Abatement Hearing on March 19, 2024.
The Street Improvement Project portion of the Bonds are being issued pursuant to Minnesota
Statutes, Chapter 475.58 3b and the required public hearing on the Street Reconstruction and
Overlay Plan will be held on March 19, 2024.
The Street Reconstruction portion of the Bonds are also restricted by the amount of net debt
the City can issue. The City cannot issue debt in excess of 3% of the assessor’s estimated
market value for the City. The 2024 Estimated Market Value is $1,079,820,400. Therefore,
the total amount of outstanding debt cannot exceed $32,394,612. As of March 7, 2024, the
City had approximately $2.78 million of existing debt subject to the legal debt limit. With this
proposed debt issuance discussed in this report, approximately $26.1 million would be
available in debt capacity.
The Bonds will be general obligations of the City for which its full faith, credit and taxing
powers are pledged.
EXECUTIVE SUMMARY OF PROPOSED DEBT
Presale Report
City of Scandia, Minnesota
March 19, 2024
Page 2
Term/Call Feature:
The Bonds are being issued for a term of 16 years. Principal on the Bonds will be due on
February 1 in the years 2026 through 2040 (15 years). Interest will be due every six months
beginning February 1, 2025.
Bonds maturing on February 1, 2035, and thereafter are subject to call for prior optional
redemption on February 1, 2034 or any date thereafter.
Bank Qualification:
Because the City is expecting to issue no more than $10,000,000 in tax exempt debt during
the calendar year, the City will be able to designate the Bonds as “bank qualified” obligations.
Bank qualified status broadens the market for the Bonds, which can result in lower interest
rates.
Rating:
The City’s most recent bond issue was rated by S&P Global Ratings. The current rating on
those bonds is AA+. The City will request a new rating for the Bonds.
If the winning bidder on the Bonds elects to purchase bond insurance, the rating for the issue
may be higher than the City's bond rating in the event that the bond rating of the insurer is
higher than that of the City.
Basis for Recommendation:
Based on your objectives, financial situation and need, risk tolerance, liquidity needs,
experience with the issuance of Bonds and long-term financial capacity, as well as the tax
status considerations related to the Bonds and the structure, timing and other similar matters
related to the Bonds, we are recommending the issuance of Bonds as a suitable option.
Method of Sale/Placement:
We are recommending the Bonds be issued as municipal securities and offered through a
competitive underwriting process. You will solicit competitive bids, which we will compile on
your behalf, for the purchase of the Bonds from underwriters and banks.
An allowance for discount bidding will be incorporated in the terms of the issue. The discount
is treated as an interest item and provides the underwriter with all or a portion of their
compensation in the transaction.
If the Bonds are purchased at a price greater than the minimum bid amount (maximum
discount), the unused allowance may be used to reduce your borrowing amount.
Presale Report
City of Scandia, Minnesota
March 19, 2024
Page 3
Premium Pricing:
In some cases, investors in municipal bonds prefer “premium” pricing structures. A premium
is achieved when the coupon for any maturity (the interest rate paid by the issuer) exceeds
the yield to the investor, resulting in a price paid that is greater than the face value of the
bonds. The sum of the amounts paid in excess of face value is considered “reoffering
premium.” The underwriter of the bonds will retain a portion of this reoffering premium as
their compensation (or “discount”) but will pay the remainder of the premium to the City. The
amount of the premium varies, but it is not uncommon to see premiums for new issues in the
range of 2.00% to 10.00% of the face amount of the issue. This means that an issuer with a
$2,000,000 offering may receive bids that result in proceeds of $2,040,000 to $2,200,000.
For this issue of Bonds we have been directed to use the net premium to reduce the size of
the issue for the project. The resulting adjustments may slightly change the true interest cost
of the issue, either up or down.
The amount of premium can be restricted in the bid specifications. Restrictions on premium
may result in fewer bids, but may also eliminate large adjustments on the day of sale and
unintended impacts with respect to debt service payment. Ehlers will identify appropriate
premium restrictions for the Bonds intended to achieve the City’s objectives for this financing.
Review of Existing Debt:
We have reviewed all outstanding indebtedness for the City and find that there are no
refunding opportunities at this time. We will continue to monitor the market and the call dates
for the City’s outstanding debt and will alert you to any future refunding opportunities.
Continuing Disclosure:
Ehlers can assist the City in meeting all of its continuing disclosure requirements.
Arbitrage Monitoring:
The City must ensure compliance with certain sections of the Internal Revenue Code and
Treasury Regulations (“Arbitrage Rules”) throughout the life of the issue to maintain the tax-
exempt status of the Bonds. These Arbitrage Rules apply to amounts held in construction,
escrow, reserve, debt service account(s), etc., along with related investment income on each
fund/account. IRS audits will verify compliance with rebate, yield restriction and records
retention requirements within the Arbitrage Rules. The City’s specific arbitrage responsibilities
will be detailed in the Nonarbitrage Certificate (the “Tax Compliance Document”) prepared
by your Bond Attorney and provided at closing.
The Bonds may qualify for one or more exception(s) to the Arbitrage Rules by meeting 1)
small issuer exception, 2) spend down requirements, 3) bona fide debt service fund limits, 4)
reasonable reserve requirements, 5) expenditure within an available period limitations, 6)
investments yield restrictions, 7) de minimis rules, or; 8) borrower limited requirements.
An Ehlers arbitrage expert will contact the City within 30 days after the sale date to review
the City’s specific responsibilities for the Bonds.
Presale Report
City of Scandia, Minnesota
March 19, 2024
Page 4
Investment of Bond Proceeds:
Ehlers can assist the City in developing a strategy to invest your Bond proceeds until the
funds are needed to pay project costs.
Other Service Providers:
This debt issuance will require the engagement of other public finance service providers. This
section identifies those other service providers, so Ehlers can coordinate their engagement
on your behalf. Where you have previously used a particular firm to provide a service, we have
assumed that you will continue that relationship. For services you have not previously
required, we have identified a service provider. Fees charged by these service providers will
be paid from proceeds of the obligation, unless you notify us that you wish to pay them from
other sources. Our pre-sale bond sizing includes a good faith estimate of these fees, but the
final fees may vary. If you have any questions pertaining to the identified service providers or
their role, or if you would like to use a different service provider for any of the listed services
please contact us.
Bond Counsel: Taft Stettinius & Hollister LLP
Paying Agent: TBD
Rating Agency: S&P Global Ratings (S&P)
Summary:
The decisions to be made by the City Council are as follows:
Accept or modify the finance assumptions described in this report
Adopt the resolution providing for the sale of the Bonds.
Presale Report
City of Scandia, Minnesota
March 19, 2024
Page 5
Pre-Sale Review by City Council and Hearings: March 19, 2024
Due Diligence Call to Review Official Statement: Week of April 15, 2024
Conference with Rating Agency: Week of April 15, 2024
Distribute Official Statement: Week of April 22, 2024
City Council Meeting to Award Sale of the Bonds: May 1, 2024
Estimated Closing Date: May 22, 2024
Attachments
Estimated Sources and Uses of Funds
Estimated Proposed Debt Service Schedule
Resolution Authorizing Ehlers to Proceed with Bond Sale (Distributed separately by
Bond Counsel)
EHLERS’ CONTACTS
Jason Aarsvold, Senior Municipal Advisor (651) 697-8512
Todd Hagen, Senior Municipal Advisor (651) 697-8508
Schane Rudlang, Associate Municipal Advisor (651) 697-8527
Silvia Johnson, Lead Public Finance Analyst (651) 697-8580
Alicia Gage, Senior Financial Analyst (651) 697-8551
PROPOSED DEBT ISSUANCE SCHEDULE
EHLERS’ CONTACTS
City of Scandia, Minnesota
$4,135,000 General Obligation Bonds, Series 2024A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 50bps
Total Issue Sources And Uses
Dated 05/22/2024 | Delivered 05/22/2024
Street
Reconstruction
Tax
Abatement
Issue
Summary
Sources Of Funds
Par Amount of Bonds $3,480,000.00 $655,000.00 $4,135,000.00
Total Sources $3,480,000.00 $655,000.00 $4,135,000.00
Uses Of Funds
Total Underwriter's Discount (1.200%)41,760.00 7,860.00 49,620.00
Costs of Issuance 56,572.56 10,177.44 66,750.00
Deposit to Capitalized Interest (CIF) Fund 79,152.60 14,907.15 94,059.75
Deposit to Project Construction Fund 3,300,000.00 620,000.00 3,920,000.00
Rounding Amount 2,514.84 2,055.41 4,570.25
Total Uses $3,480,000.00 $655,000.00 $4,135,000.00
Series 2024 GO Bonds - Pr | Issue Summary | 3/ 5/2024 | 8:31 AM
City of Scandia, Minnesota
$4,135,000 General Obligation Bonds, Series 2024A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 50bps
Debt Service Schedule
Date Principal Coupon Interest Total P+I Fiscal Total
05/22/2024 -----
02/01/2025 --94,059.75 94,059.75 94,059.75
08/01/2025 --67,995.00 67,995.00 -
02/01/2026 220,000.00 3.200%67,995.00 287,995.00 355,990.00
08/01/2026 --64,475.00 64,475.00 -
02/01/2027 225,000.00 3.150%64,475.00 289,475.00 353,950.00
08/01/2027 --60,931.25 60,931.25 -
02/01/2028 230,000.00 3.100%60,931.25 290,931.25 351,862.50
08/01/2028 --57,366.25 57,366.25 -
02/01/2029 245,000.00 3.050%57,366.25 302,366.25 359,732.50
08/01/2029 --53,630.00 53,630.00 -
02/01/2030 250,000.00 3.050%53,630.00 303,630.00 357,260.00
08/01/2030 --49,817.50 49,817.50 -
02/01/2031 255,000.00 3.050%49,817.50 304,817.50 354,635.00
08/01/2031 --45,928.75 45,928.75 -
02/01/2032 260,000.00 3.050%45,928.75 305,928.75 351,857.50
08/01/2032 --41,963.75 41,963.75 -
02/01/2033 275,000.00 3.150%41,963.75 316,963.75 358,927.50
08/01/2033 --37,632.50 37,632.50 -
02/01/2034 280,000.00 3.150%37,632.50 317,632.50 355,265.00
08/01/2034 --33,222.50 33,222.50 -
02/01/2035 290,000.00 3.100%33,222.50 323,222.50 356,445.00
08/01/2035 --28,727.50 28,727.50 -
02/01/2036 295,000.00 3.300%28,727.50 323,727.50 352,455.00
08/01/2036 --23,860.00 23,860.00 -
02/01/2037 310,000.00 3.400%23,860.00 333,860.00 357,720.00
08/01/2037 --18,590.00 18,590.00 -
02/01/2038 320,000.00 3.650%18,590.00 338,590.00 357,180.00
08/01/2038 --12,750.00 12,750.00 -
02/01/2039 335,000.00 3.750%12,750.00 347,750.00 360,500.00
08/01/2039 --6,468.75 6,468.75 -
02/01/2040 345,000.00 3.750%6,468.75 351,468.75 357,937.50
Total $4,135,000.00 -$1,300,777.25 $5,435,777.25 -
Yield Statistics
Bond Year Dollars $38,410.04
Average Life 9.289 Years
Average Coupon 3.3865552%
Net Interest Cost (NIC)3.5157401%
True Interest Cost (TIC)3.5281040%
Bond Yield for Arbitrage Purposes 3.3714332%
All Inclusive Cost (AIC)3.7430582%
IRS Form 8038
Net Interest Cost 3.3865552%
Weighted Average Maturity 9.289 Years
Series 2024 GO Bonds - Pr | Issue Summary | 3/ 5/2024 | 8:31 AM
City of Scandia, Minnesota
$4,135,000 General Obligation Bonds, Series 2024A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 50bps
Debt Service Schedule
Date Principal Coupon Interest Total P+I CIF Net New D/S
105% of
Total
02/01/2025 --94,059.75 94,059.75 (94,059.75)--
02/01/2026 220,000.00 3.200%135,990.00 355,990.00 -355,990.00 373,789.50
02/01/2027 225,000.00 3.150%128,950.00 353,950.00 -353,950.00 371,647.50
02/01/2028 230,000.00 3.100%121,862.50 351,862.50 -351,862.50 369,455.63
02/01/2029 245,000.00 3.050%114,732.50 359,732.50 -359,732.50 377,719.13
02/01/2030 250,000.00 3.050%107,260.00 357,260.00 -357,260.00 375,123.00
02/01/2031 255,000.00 3.050%99,635.00 354,635.00 -354,635.00 372,366.75
02/01/2032 260,000.00 3.050%91,857.50 351,857.50 -351,857.50 369,450.38
02/01/2033 275,000.00 3.150%83,927.50 358,927.50 -358,927.50 376,873.88
02/01/2034 280,000.00 3.150%75,265.00 355,265.00 -355,265.00 373,028.25
02/01/2035 290,000.00 3.100%66,445.00 356,445.00 -356,445.00 374,267.25
02/01/2036 295,000.00 3.300%57,455.00 352,455.00 -352,455.00 370,077.75
02/01/2037 310,000.00 3.400%47,720.00 357,720.00 -357,720.00 375,606.00
02/01/2038 320,000.00 3.650%37,180.00 357,180.00 -357,180.00 375,039.00
02/01/2039 335,000.00 3.750%25,500.00 360,500.00 -360,500.00 378,525.00
02/01/2040 345,000.00 3.750%12,937.50 357,937.50 -357,937.50 375,834.38
Total $4,135,000.00 -$1,300,777.25 $5,435,777.25 (94,059.75)$5,341,717.50 $5,608,803.38
Significant Dates
Dated 5/22/2024
First Coupon Date 2/01/2025
Yield Statistics
Bond Year Dollars $38,410.04
Average Life 9.289 Years
Average Coupon 3.3865552%
Net Interest Cost (NIC)3.5157401%
True Interest Cost (TIC)3.5281040%
Bond Yield for Arbitrage Purposes 3.3714332%
All Inclusive Cost (AIC)3.7430582%
Series 2024 GO Bonds - Pr | Issue Summary | 3/ 5/2024 | 8:31 AM
City of Scandia, Minnesota
$3,480,000 General Obligation Bonds, Series 2024A
Street Reconstruction
Assumes Current Market BQ AA+ Rates plus 50bps
Debt Service Schedule
Date Principal Coupon Interest Total P+I CIF Net New D/S
105% of
Total
02/01/2025 --79,152.60 79,152.60 (79,152.60)--
02/01/2026 185,000.00 3.200%114,437.50 299,437.50 -299,437.50 314,409.38
02/01/2027 190,000.00 3.150%108,517.50 298,517.50 -298,517.50 313,443.38
02/01/2028 195,000.00 3.100%102,532.50 297,532.50 -297,532.50 312,409.13
02/01/2029 205,000.00 3.050%96,487.50 301,487.50 -301,487.50 316,561.88
02/01/2030 210,000.00 3.050%90,235.00 300,235.00 -300,235.00 315,246.75
02/01/2031 215,000.00 3.050%83,830.00 298,830.00 -298,830.00 313,771.50
02/01/2032 220,000.00 3.050%77,272.50 297,272.50 -297,272.50 312,136.13
02/01/2033 230,000.00 3.150%70,562.50 300,562.50 -300,562.50 315,590.63
02/01/2034 235,000.00 3.150%63,317.50 298,317.50 -298,317.50 313,233.38
02/01/2035 245,000.00 3.100%55,915.00 300,915.00 -300,915.00 315,960.75
02/01/2036 250,000.00 3.300%48,320.00 298,320.00 -298,320.00 313,236.00
02/01/2037 260,000.00 3.400%40,070.00 300,070.00 -300,070.00 315,073.50
02/01/2038 270,000.00 3.650%31,230.00 301,230.00 -301,230.00 316,291.50
02/01/2039 280,000.00 3.750%21,375.00 301,375.00 -301,375.00 316,443.75
02/01/2040 290,000.00 3.750%10,875.00 300,875.00 -300,875.00 315,918.75
Total $3,480,000.00 -$1,094,130.10 $4,574,130.10 (79,152.60)$4,494,977.50 $4,719,726.38
Significant Dates
Dated 5/22/2024
First Coupon Date 2/01/2025
Yield Statistics
Bond Year Dollars $32,312.00
Average Life 9.285 Years
Average Coupon 3.3861417%
Net Interest Cost (NIC)3.5153816%
True Interest Cost (TIC)3.5277583%
Bond Yield for Arbitrage Purposes 3.3714332%
All Inclusive Cost (AIC)3.7443216%
Series 2024 GO Bonds - Pr | Street Reconstruction | 3/ 5/2024 | 8:31 AM
City of Scandia, Minnesota
$655,000 General Obligation Bonds, Series 2024A
Tax Abatement
Assumes Current Market BQ AA+ Rates plus 50bps
Debt Service Schedule
Date Principal Coupon Interest Total P+I CIF
Net New
D/S
105% of
Total
02/01/2025 --14,907.15 14,907.15 (14,907.15)--
02/01/2026 35,000.00 3.200%21,552.50 56,552.50 -56,552.50 59,380.13
02/01/2027 35,000.00 3.150%20,432.50 55,432.50 -55,432.50 58,204.13
02/01/2028 35,000.00 3.100%19,330.00 54,330.00 -54,330.00 57,046.50
02/01/2029 40,000.00 3.050%18,245.00 58,245.00 -58,245.00 61,157.25
02/01/2030 40,000.00 3.050%17,025.00 57,025.00 -57,025.00 59,876.25
02/01/2031 40,000.00 3.050%15,805.00 55,805.00 -55,805.00 58,595.25
02/01/2032 40,000.00 3.050%14,585.00 54,585.00 -54,585.00 57,314.25
02/01/2033 45,000.00 3.150%13,365.00 58,365.00 -58,365.00 61,283.25
02/01/2034 45,000.00 3.150%11,947.50 56,947.50 -56,947.50 59,794.88
02/01/2035 45,000.00 3.100%10,530.00 55,530.00 -55,530.00 58,306.50
02/01/2036 45,000.00 3.300%9,135.00 54,135.00 -54,135.00 56,841.75
02/01/2037 50,000.00 3.400%7,650.00 57,650.00 -57,650.00 60,532.50
02/01/2038 50,000.00 3.650%5,950.00 55,950.00 -55,950.00 58,747.50
02/01/2039 55,000.00 3.750%4,125.00 59,125.00 -59,125.00 62,081.25
02/01/2040 55,000.00 3.750%2,062.50 57,062.50 -57,062.50 59,915.63
Total $655,000.00 -$206,647.15 $861,647.15 (14,907.15)$846,740.00 $889,077.00
Significant Dates
Dated 5/22/2024
First Coupon Date 2/01/2025
Yield Statistics
Bond Year Dollars $6,098.04
Average Life 9.310 Years
Average Coupon 3.3887461%
Net Interest Cost (NIC)3.5176400%
True Interest Cost (TIC)3.5299364%
Bond Yield for Arbitrage Purposes 3.3714332%
All Inclusive Cost (AIC)3.7363646%
Series 2024 GO Bonds - Pr | Tax Abatement | 3/ 5/2024 | 8:31 AM
City of Scandia, Minnesota
$4,135,000 General Obligation Bonds, Series 2024A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 50bps
Detail Costs Of Issuance
Dated 05/22/2024 | Delivered 05/22/2024
COSTS OF ISSUANCE DETAIL
Municipal Advisor $31,000.00
SROP Fee $2,500.00
Bond Counsel $16,250.00
Rating Agency Fee $16,000.00
Miscellaneous $1,000.00
TOTAL $66,750.00
Series 2024 GO Bonds - Pr | Issue Summary | 3/ 5/2024 | 8:31 AM
131861526v1
EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE CITY OF SCANDIA, MINNESOTA
HELD: March 19, 2024
Pursuant to due call and notice thereof, a regular or special meeting of the City Council of
the City of Scandia, Washington County, Minnesota, was duly held at City Hall on March 19, 2024
at 7:00 P.M., for the purpose in part of approving and adopting a street reconstruction and overlay
plan and approving the issuance of general obligation street reconstruction bonds.
The following members were present:
and the following were absent:
Member __________________ introduced the following resolution and moved its
adoption:
RESOLUTION NO. 03-19-24-02
RESOLUTION ADOPTING A STREET RECONSTRUCTION AND
OVERLAY PLAN AND APPROVING THE ISSUANCE OF GENERAL
OBLIGATION STREET RECONSTRUCTION BONDS
WHEREAS, the City of Scandia, Minnesota (the "City"), has determined that it is in the
best interest of the City to authorize the issuance and sale of general obligation street reconstruction
bonds pursuant to Minnesota Statutes, Section 475.58, subdivision 3b, as amended (the "Act"), to
finance the cost of street reconstruction projects, as described in the proposed street reconstruction
and overlay plan described below, a copy of which is on file in the City Clerk's office; and
WHEREAS, pursuant to the Act, the City is authorized to issue and sell general obligation
street reconstruction bonds for street reconstruction under the circumstances and within the
limitations set forth in the Act. The Act provides that a street reconstruction and overlay plan may
be financed with general obligation street reconstruction bonds, following adoption of a street
reconstruction and overlay plan, after a public hearing on the street reconstruction and overlay plan
and on the issuance of general obligation street reconstruction bonds and other proceedings
conducted in accordance with the requirements of the Act; and
WHEREAS, pursuant to the Act, the City has caused the preparation of the drafted Five -
Year Street Reconstruction & Overlay Plan for the City, for calendar years 2024 through 2028,
which describes the streets to be reconstructed, the estimated costs and any planned reconstruction
of other streets in the City, including the issuance of general obligation street reconstruction bonds
under the Act (the "Plan"), to determine the funding strategy for street reconstruction projects; and
131861526v1
2
WHEREAS, the City Council held a public hearing on the same date hereof on the adoption
of the Plan and the issuance of not to exceed $3,480,000 general obligation street reconstruction
bonds (the "Bonds") under the Plan for street reconstruction improvements to those streets
described in the Plan (the "Street Reconstruction Projects") after publication of the notice of public
hearing not less than 10 days nor more than 28 days prior to the date thereof in the City's official
newspaper; and
WHEREAS, all parties who appeared at the public hearing were given an opportunity to
express their views with respect to the proposal to adopt the Plan and to undertake and finance the
Street Reconstruction Projects by the issuance of Bonds and any written comments submitted prior
to the public hearing were considered.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Scandia,
County of Washington, State of Minnesota, as follows:
1. City Policies and Goals. The financing of the Street Reconstruction Projects and
the issuance and sale of the Bonds would further the policies and goals of the City as set forth in
the Plan, hereby adopted by the City Council in connection with the issuance of the Bonds.
2. Public Hearing Notice. The City Council hereby ratifies the actions of the City
Clerk in causing the publication of the Notice of Public Hearing in the City's official newspaper
as required by law; and
3. Adoption of Street Reconstruction and Overlay Plan. Based on information
received at the public hearing, such written comments (if any) and such other facts and
circumstances as the City Council deems relevant, it is hereby found, determined and declared
that:
a. the Street Reconstruction Projects proposed in the Plan will allow the City
to upgrade its transportation infrastructure to accommodate anticipated and existing
residential and commercial development; and
b. the Plan is hereby approved and adopted in the form presently on file with
the City.
4. Authorization and Approval of Bonds. The City is hereby authorized to issue the
Bonds, the proceeds of which will be used, together with any additional funds of the City which
might be required, to finance certain costs of the Street Reconstruction Projects and to pay costs
of issuance of the Bonds.
5. Execution of Documents. The Mayor and City Clerk are authorized and directed
to execute such other documents and instruments as may be required to give effect to the
transactions herein contemplated.
6. Voter Referendum Contingency. Pursuant to the Act, a petition requesting a vote
on the question of issuing the Bonds, signed by voters equal to five percent of the votes cast in the
last municipal general election, may be filed within thirty days of the public hearing. Upon receipt
of such petition within the prescribed time period, the City may issue the Bonds only after
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obtaining the approval of a majority of the voters voting on the question of the issuance of the
Bonds. The authorizations and approvals contained herein are subject to and contingent upon not
receiving such a petition, or, in the event such a petition is filed, the approving vote of a majority
of the voters voting on the question of the issuance of the Bonds.
The motion for the adoption of the foregoing resolution was duly seconded by Council
Member _______________________ and, after full discussion thereof and upon a vote being
taken thereon, the following Council Members voted in favor thereof:
and the following voted against the same:
Whereupon said resolution was declared duly passed and adopted.
131861526v1
CITY CLERK'S CERTIFICATE
I, the undersigned, being the duly qualified and acting City Clerk of the City of Scandia,
Minnesota (the "City"), DO HEREBY CERTIFY that I have compared the attached and foregoing
extract of minutes with the original thereof on file in my office, and that the same is a full, true
and complete transcript of the minutes of a meeting of the City Council of the City, duly called
and held on the date therein indicated, insofar as such minutes relate to adopting a street
reconstruction and overlay plan and approving the issuance of bonds therefor.
WITNESS my hand this ____ day of ________________, 2024.
__________________________________
City Clerk
Scandia, Minnesota
131960714v1
1
EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE CITY OF SCANDIA, MINNESOTA
HELD: March 19, 2024
Pursuant to due call and notice thereof, a regular or special meeting of the City Council of
the City of Scandia, Washington County, Minnesota, was duly held at City Hall on March 19, 2024
at 7:00 P.M., for the purpose in part of approving property tax abatements.
The following members were present:
and the following were absent:
Member __________________ introduced the following resolution and moved its
adoption:
RESOLUTION NO. 03-19-24-03
RESOLUTION APPROVING PROPERTY TAX ABATEMENTS
BE IT RESOLVED by the City Council (the "Council") of the City of Scandia, Minnesota
(the "City"), as follows:
1. Recitals.
(a) The City proposes to approve tax abatements in connection with the financing of
the City's designated 2024 Crack Fill & Seal Coat Project located in the City (the "Project"). The
City proposes to use the abatement for the purposes provided for in the Abatement Law (as
hereinafter defined), including the Project. The proposed term of the abatement will be for up to
fifteen (15) years in an amount not to exceed $655,000. The tax abatement will apply to the City's
share of the property taxes (the "Abatement") derived from the property identified by the tax parcel
identification numbers listed below (the "Property"):
06.032.20.33.0003 21.032.20.31.0002 26.032.20.14.0003
08.032.20.11.0001 21.032.20.42.0005 26.032.20.23.0004
08.032.20.12.0008 22.032.20.24.0003 26.032.20.34.0004
08.032.20.12.0009 22.032.20.24.0006 26.032.20.43.0009
08.032.20.12.0010 23.032.20.44.0002 27.032.20.13.0003
09.032.20.43.0003 25.032.20.11.0003 27.032.20.41.0003
11.032.20.21.0001 26.032.20.13.0007 30.032.20.11.0001
20.032.20.13.0001
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(b) The Council held a public hearing on the same date hereof on the question of the
Abatement, and said hearing was preceded by at least 10 days but not more than 30 days prior
published notice thereof.
(c) The City proposes to issue General Obligation Tax Abatement Bonds (the "Bonds")
in the aggregate principal amount not to exceed $655,000, which will be used to finance the
Project. The City will pledge the property tax abatements to pay the Bonds.
(d) The Abatement is authorized under Minnesota Statutes, Sections 469.1912 through
469.1915 (the "Abatement Law").
2. Findings for the Abatement. The City Council hereby makes the following
findings:
(a) The Council expects the benefits to the City of the Abatement to at least equal or
exceed the costs to the City thereof.
(b) Granting the Abatement is in the public interest because it will help provide access
to services for residents of the City and provide public infrastructure.
(c) The Property is not located in a tax increment financing district.
(d) In any year, the total amount of property taxes abated by the City by this and other
existing abatement resolutions, shall not exceed ten percent (10%) of net tax capacity of the City
for the taxes payable year to which the abatement applies or $200,000, whichever is greater (the
"Abatement Limit"). The City may grant other abatements permitted under the Abatement Law
after the date of this resolution, provided that to the extent the total abatements in any year exceed
the Abatement Limit the allocation of the Abatement limit to such other abatements is subordinate
to the Abatement granted by this resolution.
3. Terms of Abatement. The Abatement is hereby approved. The terms of the
Abatement are as follows:
(a) The Abatement shall be for up to a fifteen (15) year period, anticipated to
commence for the taxes payable in the year 2025. The City reserves the right to modify the
commencement date, but the abatement period shall not exceed fifteen (15) years.
(b) The City will abate the City's share of property tax amount which the City receives
from the Property, not to exceed $655,000.
(c) In accordance with Section 469.1915 of the Abatement Law, the City will add to
its levy in each year during the term of the Abatement the total estimated amount of current year
Abatement granted under this resolution.
(d) The Abatement shall be subject to all the terms and limitations of the Abatement
Law.
131960714v1
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The motion for the adoption of the foregoing resolution was duly seconded by Council
Member _______________________ and, after full discussion thereof and upon a vote being
taken thereon, the following Council Members voted in favor thereof:
and the following voted against the same:
Whereupon said resolution was declared duly passed and adopted.
131960714v1
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CITY CLERK'S CERTIFICATE
I, the undersigned, being the duly qualified and acting City Clerk of the City of Scandia,
Minnesota (the "City"), DO HEREBY CERTIFY that I have compared the attached and foregoing
extract of minutes with the original thereof on file in my office, and that the same is a full, true
and complete transcript of the minutes of a meeting of the City Council of the City, duly called
and held on the date therein indicated, insofar as such minutes relate to approving property tax
abatements.
WITNESS my hand this ____ day of ________________, 2024.
__________________________________
City Clerk
Scandia, Minnesota
131861886v1
EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE CITY OF SCANDIA, MINNESOTA
HELD: MARCH 19, 2024
Pursuant to due call and notice thereof, a regular or special meeting of the City Council of
the City of Scandia, Washington County, Minnesota, was duly held at City Hall on March 19,
2024, at 7:00 P.M., for the purpose, in part, of authorizing the competitive negotiated sale of
$4,135,000 General Obligation Bonds, Series 2024A.
The following members were present:
and the following were absent:
Member ________________ introduced the following resolution and moved its adoption:
RESOLUTION NO. 03-19-24-04
RESOLUTION PROVIDING FOR THE SALE OF $4,135,000 GENERAL OBLIGATION
BONDS, SERIES 2024A
A. WHEREAS, the City Council of the City of Scandia, Minnesota (the "City") has
heretofore determined that it is necessary and expedient to issue the City's $4,135,000 General
Obligation Bonds, Series 2024A (the "Bonds"), to finance the City's designated (i) 2024 Street
Improvement Project, and (ii) 2024 Crack Fill & Seal Coat Project; and
B. WHEREAS, the City has retained Ehlers & Associates, Inc., in Roseville,
Minnesota ("Ehlers"), as its independent municipal advisor for the Bonds in accordance with
Minnesota Statutes, Section 475.60, Subdivision 2(9).
NOW, THEREFORE, BE IT RESOLVED by the City of Scandia, Minnesota, as follows:
1. Authorization. The City Council hereby authorizes Ehlers to assist the City for the
sale of the Bonds.
2. Meeting; Proposal Opening. The City Council shall meet at 7:00 P.M. on May 1,
2024, for the purpose of considering proposals for and awarding the sale of the Bonds.
3. Official Statement. In connection with said sale, the officers or employees of the
City are hereby authorized to cooperate with Ehlers and participate in the preparation of an official
statement for the Bonds and to execute and deliver it on behalf of the City upon its completion.
131861886v1
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The motion for the adoption of the foregoing resolution was duly seconded by Council
Member _______________________ and, after full discussion thereof and upon a vote being
taken thereon, the following Council Members voted in favor thereof:
and the following voted against the same:
Whereupon said resolution was declared duly passed and adopted.
131861886v1
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STATE OF MINNESOTA
WASHINGTON COUNTY
CITY OF SCANDIA
I, the undersigned, being the duly qualified and acting Clerk of the City of Scandia,
Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of
minutes with the original thereof on file in my office, and that the same is a full, true and complete
transcript of the minutes of a meeting of the City Council, duly called and held on the date therein
indicated, insofar as the minutes relate to providing for the issuance and sale of $4,135,000 General
Obligation Bonds, Series 2024A.
WITNESS my hand on March 19, 2024.
__________________________________________
Clerk