6.5. SR 04-28-1997 - Laserfiche WebLink

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'ty of iver MEMORANDUM Item # 6.5. TO: FROM: DATE: SUBJECT: Mayor & City Council Lori Johnson, Asst. City Administrator/ Finance Director April 28, 1997 Consider Resolution Awarding the Sale of the City's $311,500 General Obligation Equipment Certificate of 1997; Directing its Form and Specifications; Directing its Execution and Delivery; and Providing for its Payment Attached is a resolution to award the sale of the 1997 Equipment Certificate. As you can see, the issue is considerably larger than issues in previous years: Because the rate on the Equipment Certificate is lower than the rate guaranteed by the manufacturer of the fire pumper, that piece of equipment has been added to this Certificate. The 1997 budget included equipment certificate expenditures in the amount of $111,000 ($91,000 for police and $20,000 for streets). The 1997 tax levy included $31,000 for the equipment certificate. Again this year, the certificate is being reduced by the levy amount; this results in decreased interest expense. When the Council approved the purchase of the pumper in August, financing options were discussed. At that time, the manufacturer offered a guaranteed interest rate of 5.6 percent for financing the pumper. A partial payment of $74,000 was made leaving a balance of $227,921 to be financed. The Bank of Elk River will purchase the Equipment Certificates at an interest rate of 5 percent. For that reason the pumper has been included in this Equipment Certificate. Because the pumper is due to be delivered on April 29, the certificate is being issued earlier than usual so that funds will be available for the pumper. Although the attached resolution indicates that tax levies will be made for the payment of the entire Certificate, those levies in reality will be reduced by the amounts attributable to the fire pumper. Pumper payments are 13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · (612) 441-7420 · Fax: (612) 441-7425