The Fergus Falls City Council passed a resolution providing for the issuance and sale of $7,405,000 general obligation bonds Monday in their first meeting of October.
The city sold its general obligation refunding bonds series 2020A to refund six outstanding bond issues and finance the acquisition of a new fire truck. The bonds were sold through a negotiated sale with Robert W. Baird, who served as the sole underwriter of the sale.
“The purpose of the refinancing of that portion of the bond was to refund six individual bond issues from prior years,” Fergus Falls finance director Bill Sonmor said. “That is where we get that saving. In addition to all that we issued bonds to finance the fire truck and we are taking delivery of that fire truck in February of 2021.”
The truck will replace one that Sonmor said has been in service for approximately 30 to 35 years.
According to Baker Tilly Municipal Advisors, the bonds sold at a premium. The additional bond proceeds generated by the premium pricing are used to reduce the par amount of the bonds. The total present value savings as a result of refunding the six outstanding bond issues is $568,508, which is 6.7% of outstanding debt service.
The average annual principal and interest payment on the fire truck will be approximately $52,000 from 2021-2029.
Baker Tilly and the city’s bond counsel will draft closing documents over the next few weeks. Bond proceeds will be received in city coffers by Oct. 28. Baker Tilly will be notifying the appropriate parties to indicate the six bonds issues will be paid off on Feb. 1, 2021.
The council heard the first reading of Ordinance 8, eighth series. The ordinance is intended to amend the zoning map from R-A to I-2 for Fergus Falls Port Authority-owned property north of Weyrens Road. A buyer for the property has been found and the Fergus Falls Planning Commission has recommended the ordinance be adopted. The 43 acres is expected to be the future home of a demolition and recycling center.
The council held the second reading of Ordinance 6, Eighth Series and accepted an annexation petition from Bruce and Stefanie Gerhardson.
The council held public hearings for tax rebates at 3503 Pebble Hills Drive and 1424 Ridgewood Drive. The Pebble Hills Dive request was made by Precise Carpentry while the Ridgewood Drive rebate was requested by Nick and Sammy Ebert.
The purpose of the tax rebate program is to encourage the construction of new primary residence single and two-family housing units in the city and the replacement of dilapidated housing structures in the city.
According to Fergus Falls Community Development director Klara Beck, any person filing application materials for new primary residence housing units between Jan. 1, 2020 and Dec. 31, 2022 may be eligible for a 100% tax rebate from the city’s share of increased real estate taxes for a period of up to five years, or up to $5,000 per unit, whichever comes first.
Mayor Ben Schierer issued a proclamation declaring Oct. 1-7 as Minnesota Manufacturing Week.
Items on the consent agenda approved by the council were:
• A resolution approving change order No. 1 for DeLagoon Field 5.
• A resolution approving budget adjustments.
• A resolution certifying election judges for the November 3, 2020, general election.
• A resolution approving a variance to construct a detached accessory garage within the front yard of the property located at 1304 Brenvei Drive as requested by Steve Tonneson.
• A motion directing the city attorney to draft an ordinance amending the official zoning map from R-A to I-2 for a 43-acre Fergus Falls Port Authority parcel.
• A resolution setting a public hearing for Minnesota Investment Fund loan for Companion Health Properties LLC for October 19, 2020, at 5:30 p.m.
• A resolution authorizing the city administrator or finance director to sign a contract with USI Consulting Group, Inc. (Hildi) for the actuarial study for the City of Fergus Falls.