HomeMy WebLinkAbout20090921 - VI-06
MEMO
TO: Honorable Mayor and City Council members
FROM: Charlene A. Stark, Finance Director
RE: Hydro Bonds Redemption
DATE: August 17, 2009
Background
The City of Hastings in 1985 issued bonds to build a hydro plant out in the middle of the
Mississippi river. This hydro plant has an exclusive contract with Excel energy to
purchase 100% of the energy the Hydro plant can produce until June 30, 2033. The
bonds issued in 1985 were to expire on December, 2006 in conjunction with the
expiration of the franchise fee. It was the desire of the council in 1985 that hydro plant
would pay off the bonds and then the revenues produced would be available to be used
to decrease the need of a tax levy in the general fund.
In the spring of 2001 a flood occurred that caused the hydro plant to be refurbished to
the extent that the hydro plant was taken off line for nearly a year and thus the bonds
were refinanced and extended out to December 2016.
The Hydro plant after the refurbishing of the equipment in 2001 has produced revenues
to cover the bonds at the end of 2009 and the Finance committee has decided to call the
bonds on the call date of December 1, 2009. By calling the bonds this will allow the
revenues produced there after to unobligated and thus available for the council to
transfer funds to the general fund and thus reduced the need of tax levy for the general
fund. The goal that the council had back in 1985 is about to be achieved at the end of
this year. In the 2010 budget there is a transfer of $750,000 out of the hydro fund and
into the general fund, which reduces the levy needs within the general fund.
Council Action
:
Approve the Resolution for calling the Taxable Hydro Electric Revenue Refunding Bonds
of 2002A on December 1, 2009.
EXTRACT OF MINUTES OF MEETING OF THE
CITY COUNCIL OF THE CITY OF
HASTINGS, MINNESOTA
HELD: September 21, 2009
Pursuant to due call and notice thereof, a regular meeting of the City Council of
the City of Hastings, Minnesota, was duly called and held at the City Hall in said City on the
21st day of September, 2009, at _____ o'clock P.M.
The following members were present:
and the following were absent:
Member __________________ introduced the following resolution and moved its
adoption:
RESOLUTION CALLING FOR THE REDEMPTION OF
TAXABLE GENERAL OBLIGATION HYDROELECTRIC
REVENUE REFUNDING BONDS, SERIES 2002A
WHEREAS:
A.The City of Hastings, Minnesota, has heretofore issued its Taxable
General Obligation Hydroelectric Revenue Refunding Bonds, Series 2002A (the "Bonds") dated
January 15, 2002.
B.The Bonds maturing on December 1 in the years 2010 through 2016, both
inclusive, are subject to redemption and prepayment at the option of the City on December 1,
2009, and on any date thereafter, at a price of par plus accrued interest.
C.The City Council deems it desirable and in the best interests of the City to
call the Bonds maturing in the years 2010 through 2016, both inclusive, on December 1, 2009.
NOW THEREFORE, BE IT RESOLVED by the City Council of the City of
Hastings, Minnesota, as follows:
1.The Bonds maturing on December 1 in the years 2010 through 2016, both
inclusive, shall be redeemed and prepaid on December 1, 2009, at a price of par and accrued
interest.
2.The City Finance Director is hereby authorized and directed to cause
notice of the call to be mailed to the paying agent for the Bonds at least 30 days prior to
December 1, 2009. The notice shall be in substantially the form attached hereto as Exhibit A.
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The motion for the adoption of the foregoing resolution was duly seconded by
member _________________ and upon a vote being taken thereon, the following voted in favor
thereof;
and the following voted against the same:
Whereupon said resolution was declared duly passed and adopted.
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Council member _____________________ moved a second, and upon being put to a vote it was
unanimously adopted by all Council members present.
Adopted by the Hastings City Council on this _ day of _______, 2009, by the
following vote:
Ayes
Nays:
Absent:
CITY OF HASTINGS
Paul J. Hicks, Mayor
ATTEST:
Melanie Mesko Lee, City Clerk
I hereby certify that the above is a true and correct copy presented to and adopted by the
City of Hastings, County of Dakota, Minnesota, on the _____ day of ______, 2009, as disclosed
by the records of the City of Hastings on file and of record in the office.
Melanie Mesko Lee,
City Clerk/Assistant City Administrator
STATE OF MINNESOTA
COUNTIES OF DAKOTA AND WASHINGTON
CITY OF HASTINGS
I, the undersigned, being the duly qualified and acting Deputy City Clerk of the
City of Hastings, Minnesota, DO HEREBY CERTIFY that I have carefully compared the
attached and foregoing extract of minutes of the City Council of the City held on the date therein
indicated, with the original thereof on file in my office, and the same is a full, true and complete
transcript therefrom insofar as the same relates to calling for redemption the outstanding Taxable
General Obligation Hydroelectric Revenue Refunding Bonds, Series 2002A.
WITNESS my hand as such Deputy City Clerk this ____ day of _____________,
2009.
Deputy City Clerk
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EXHIBIT A
NOTICE OF CALL FOR REDEMPTION
TAXABLE GENERAL OBLIGATION HYDROELECTRIC
REVENUE REFUNDING BONDS, SERIES 2002A
CITY OF HASTINGS
DAKOTA AND WASHINGTON COUNTIES, MINNESOTA
NOTICE IS HEREBY GIVEN that by order of the City Council of the City of Hastings, Dakota
and Washington Counties, Minnesota, there have been called for redemption and prepayment on
December 1, 2009
outstanding bonds of the City designated as Taxable General Obligation Hydroelectric Revenue
Refunding Bonds, Series 2002A, dated January 15, 2002, having stated maturity dates in the
years 2010 through 2016, both inclusive, and totaling $3,010,000 in principal amount. The
Bonds are being called at a price of par, plus accrued interest to December 1, 2009, on which
date all interest on said Bonds will cease to accrue. Holders of the Bonds hereby called for
redemption are requested to present their Bonds for payment, at U.S. Bank National Association
(as successor to U.S. Bank Trust National Association) in St. Paul, Minnesota, on or before
December 1, 2009.
Dated: September 21, 2009
BY ORDER OF THE CITY COUNCIL OF
THE CITY OF HASTINGS, MINNESOTA
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