3.11. SR 06-18-2007 - Laserfiche WebLink

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REQUEST FOR ACTION To Ci Council Agenda Section Consent Item Description Consider Intent to Enter into a Direct Loan Agreement with the Minnesota Public Facilities Authority for the Financing of 193'd Avenue Project. Meeting Date une 18, 2007 Item Number 3.11* Prepared by Tim Simon, Finance Director Reviewed by Lori ohnson, Ci Administrator Reviewed by Action Requested Council is asked to approve the resolution to apply for a transportation revolving loan from the Minnesota Public Facilities Authority (PF A) in the amount of $2,431,500 for the financing of the 193,d Avenue project. Background/Discussion On February 20, 2007, the City Council approved proceeding with the 193'" Avenue improvement project and committing a litde over 5 years (2008-2012) of Municipal State Aid (MSA) and Federal SAFETEA- LV funds to finance the project. MN/DOT had $7.0 million (unleveraged) funds available in the Transportation Revolving Loan Fund (TRLF) for projects that could start using the loan proceeds before the end of calendar year 2008. Since that time, staff has worked on various applications to fund the construction phase of this project and on AprilS, 2007, The Central Minnesota Area Transportation Partnership (ATP) approved this request and forwarded the application to MN/DOT's Office ofInvestrnent Management for approval, which we found out on May 30, was certified to the Minnesota PF A. As part of the final application process the Minnesota PF A would like a resolution passed to show that it is still the City's intent to continue to go forward with the project. This resolution does not at this time commit the City to the direct loan with the Minnesota PF A, but simply is part of the final application process. If approved by the Minnesota PF A, future resolutions relating to the TRLF will be coming forward. Once the final application is approved, the City will start finalizing the details of the direct loan with the Minnesota PF A. Typically, a general obligation note is given to the Minnesota PF A in which interest rates are based on the AAA scale. The Minnesota PF A will then meet to consider how much of a discount below the AAA scale; the City could receive a discount of 1.5 percent. Financial Impact The repayment of the principal on the direct loan with the Minnesota PF A will be MSA allocations and $996,000 SAFETEA-LV Surface Transportation Program (STP) funds over the next 5 years. Bond counsel is researching to determine if future state-aid allotments can be used for the interest payments with a transportation revolving loan. A complete financing package will be presented if our application is accepted, along with repayment schedules and an interest rate. s: \Counci1\'l'im \ 193applicationresolution.doc