3.2. SR 11-28-1994 - Laserfiche WebLink

Home Browse Search

Moody's Municipal Credit Report Elk River, Minnesota New Issue sale: $2,560,000 date: For bids November 28 November 22, 1994 General Obligation/Special Tax $1,010,000 General Obligation Water Revenue Bonds, Series 1994D $1,550,000 General Obligation Improvement Bonds, Series 1994E Moody's rating: Baa 1 credit comment: Key factors supporting the confIrmation of the Baa 1 rating on the general obligation bonds of the City of Elk River are as follows: · Despite pressures related to this rapidly growing community's mounting capital, personnel and ser- vice needs, financial operations, which are largely supported by property taxes, state aid, and special assessments, continue to be satisfactorily main- tained. Small annual increases in the General Fund balance over the past four fiscal years are largely attributable to unanticipated revenues and con- servative budgeting. Year-to-date general opera- tions compare favorably to budget and the city estimates that the December 31, 1994 General Fund balance will be somewhat above that of the prior year, as the result of unanticipated building permit and plan check fee revenues. · With the current issuance to fund a new water tower along with street, curb and gutter, and storm drainage improvements, both debt burden and per capita debt remain well above the medians for cities of similar population size. The city expects to issue $2 million in gross revenue recreation facility bonds for a new ice arena in the spring of 1995, and additional general obligation backed, , .~ "\ special assessment and tax increment debt is likely to be issued over the next several years. However. support from special assessments, utility enterprise revenues, and tax increments for most of the city's outstanding general obligation debt alleviates pressure on the property tax rate. · Elk River benefIts from its close proximity to the Minneapolis-St. Paul metropolitan area, as evi- denced, in part, by its rapid population growth and continuing economic diversification. Additional growth is expected since the city remains almost two-thirds undeveloped. Resident income levels and housing values are above those of the state in general and, traditionally, county unemployment rates have exceeded state averages. At this time, we have also reviewed and confirmed the A rating on the city's general obligation state aid road bonds, which are secured by both the city's general obligation pledge and state road aid allotments, and the Baa rating on the Elk River Economic Development Authority's City Hall and Law Enforcement Facility Revenue Bonds, which are backed by the city's annual budget appropriations.