HomeMy WebLinkAbout2015-03-11 Special Meeting MINUTES
SPECIAL MEETING
BOARD OF ALDERMEN
RIVERSIDE, MISSOURI
Wednesday, March 11, 2015
12:15 p.m.
The Board of Aldermen for the City of Riverside, Missouri, met in special session in the Board
of Aldermen Chambers at City Hall, 2950 NW Vivion Road, Riverside, Missouri, on
Wednesday, March 11, 2015.
Mayor Rose called the meeting to order at 12:15 p.m. Those in attendance were Mayor Kathy
Rose, Alderman Brad Cope, Aldermen Art Homer, Mike Fuller, Chet Pruett, and Ron Super.
Candidates Frank Biondo and Al Bowman were also in attendance.
Alderman Aaron Thatcher was absent.
Also present were City Administrator Greg Mills, Deputy City Clerk Sarah Wagner, Finance
Director Donna Oliver, Community Development Director Mike Duffy, and City Engineer Travis
Hoover. Also present was Special Council Joe Bednar.
BOND REFINANCING City Administrator Greg Mills distributed a hand out with an
overview of the discussion points. He explained that Donna and
he have a conference call at 3:00 p.m. today with S&P and they
will be inquiring about the Boards plans for refinancing the 2007
Bonds. There was general discussion regarding the bond
refinancing and direction was given to the staff as to how to
proceed with the conversation with S&P.
MOTION TO ADJOURN Alderman Homer moved to adjourn the meeting at 1:12 p.m.,
second by Alderman Super.
Yes: Homer, Super, Cope, Fuller, and Pruett.
Motion carried 5-0.
Robin Littrell, City Jerk
1
Refinancing of 2007 Bonds
• $24.6 million, anticipated new average interest
rate of 2 . 25% ( up from 2 .0 % from when we
started this process), for a term of 9 years.
• Benefits
— Take advantage of lower interest rates and save
approximately $1.5 million over life of bonds
— Eliminate mortgage on property, which correlates to
elimination of requirement to pay first 50 cents of
land sales to payoff bonds
— Debt service reserve fund may no longer be required
Three Issues
1 . Would the Board like to add new money to
the refunding amount to finance either or
both of two transactions :
• Horizons Well
• Repay Developer Loan
2 . How should the release of the debt service
reserve be handled ?
3 . Real Property Tax Exemption
Horizons Well
• Cost $ 1,500,000
• The Issues:
— Using MAW to irrigate common areas and make-up water in
canals is estimated in Olsson's well study to cost $248,443
annually ($58,888 watering & $189,555 make-up)
— Water from an untreated well includes iron oxide
• Ways to pay for well :
- City
• Capital Project in 2015-16 budget (causing a corresponding
modification to annual budget)
• Include cost in bond refinancing (which would add $170,000
to annual debt service)
— CID
• Assess property at 2.5 cents per square foot for all
maintenance costs including well
Repayment of Developer Loan
• Current payoff is $3 .8 million
• 15% compounded interest
• Ways to pay this off:
— Through the current process as defined by the MDA
when a land sale occurs
• Sale of land for Horizons V would payoff $1.9 million
— Lump sum payout (requires an agreement on an
amended MDA)
• General Fund (causes a corresponding reduction to the
annual budget)
• Include in bond refinancing (which adds $410,000 to annual
debt service)
Release of Debt Service Reserve
• 2007 Bonds currently have a reserve fund of
$3 .5 million
• This reserve fund would pay debt service on
these bonds for 1 year in the event that the
City was unable to fund it.
• Due to increased TIF revenues since 2007, this
reserve fund may not be necessary for
refunded bonds.
Restriction for Real Property
Exemption
• Currently, 2007 bond insurance prohibits use
of a Real Property Tax Exemption .
• This provides shield from Company's who
might request this exemption .
• We will no longer be required to have this
restriction .
Decision Points
1. Should new money be added to the bond refinancing to either
pay for the well or pay off the developer loan?
2. How is the $3.5 million from the restricted fund to be used?
• Fund all or a portion of a reserve fund?
• Reducing amount refinanced (Final year of debt service would be 2024
— last year we receive state TIF [currently 2025])
• Increase minimum fund balance beyond current 6 month reserve
• Pay for well
• Pay off almost all of the developer loan (this option relieves concern
about interest rate rising vs. time to get MDA revised)
3. Should the restriction for real property exemption be continued?
• In bond documents, (hard restriction)
• Board policy (less restrictive)
• No restriction
CITY OF
D/S
Covera. RIVERSI
� TIFMISSOURI
Upstream from ordinary.
Debt Service
Coverage 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
TIF Revenues 3,883,782 5,028,758 5,990,183 6591915 6,675,224 6,658,703 6,743,372 5,045,575 4,905,076 4,916,057 4,955,090
2004/2011/2014 Debt Service 1,983,697 1,516,572 1,524,969 1,750,619 1,767,069 1,770,831 1,419,381 - - - -
Allocable Series 2006 Levee
District Debt Service 979,908 978,125 978,392 980,525 977,025 979,192 979,458 981,858 982,908 982,608 983,558
Available TIF Revenues 920,177 2,534,061 3,486,822 3,861,771 3,931,130 3,908,680 4,344,532 4,063,716 3,922,167 3,933,449 3,971,531
Series 2007/2015 Bonds 3,551,562 3,144,138 3,111,713 3,107,990 3,103,015 3,103,415 3103,715 2953,665_ 3,107,628 3,111,878 3,120,756
Coverage Ratio _ 0.26x 0.81x ___1.12x 1.24x 1.27x _ _ 1.26x 1.40x 1.38x 1.26x 1.26x 1.27x