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MINUTES
SPECIAL FINANCE COMMITTEE MEETING
Monday, December 7, 1998

Roll Call: Babinchak, Brooks, Carpenter and Hamerlik present

1. Matter of resolution awarding $5,185,000 Refunding Improvement Bonds, Series 1998A
Mr. Al Erickson of Springsted announced the City’s receiving an Aa3 bond rating from Moody’s, and went on to announce the good news that of the five bids received for this bond, the low bid was 4.16% for 15 years. He added there were three “out of town” bids (two from Chicago and one from New York) and two regional bids (Minneapolis area).

Carpenter made a motion to approve the resolution establishing terms and directing issuance of definitive improvement warrants on the funds of Sanitary Sewer districts Nos. 381,383,391 and 394, Storm Sewer districts Nos. 283,387,392,395,396 and 398, Street Improvement district No. 559, Paving districts Nos. 544, 555, 556 and 557, Lighting districts Nos. 115, 118, 119, 120, 121, 122, 124, 125 and 126, and Watermain districts Nos. 252,258,259,260,261 and 262 and providing for and appropriating special assessments for the support and maintenance of said funds; and to approve the resolution directing the issuance of $5,185,000 Refunding Improvement Bonds, Series 1998A and prescribing the terms and covenants thereof; and approval of the sale of bonds to the low bidder, Griffin, Kubik, Stephens and Thompson, Inc. at a true interest rate of 4.1687%. Brooks seconded. Motion carried.

2. Matter of parking ramp (County)
Mr. Schmisek referred to a handout prepared for the Committee and said the County was aware of this meeting, however no one was here at this time. Mr. Carpenter commented that we would put $2 million into a two-level ramp and as he sees it, the general downtown community won’t get to use it. Mr. O’Leary said the Commission is not likely to get a bond greater than $1 million and he said there is no way to know the Commission’s attitude. He went on to say that right now there are three options: 1) build two levels with expansion capability, 2) do nothing except above grade parking, and 3) build a three level (which adds 120 more spaces) and set up an assessment district. Mr. Schmisek said large special assessments would be devastating to those businesses. Mr. Brooks said he understood that the $2 million would buy down the assessments on a four-level ramp. Mr. Carpenter said maybe we should go ahead and build two levels and the third level can be the County’s responsibility. Mr. Malm came to the meeting at this point.

Ms. Babinchak pointed out that upon approval of the $2 million expenditure, the Committee was not aware that the County would own the ramp. Mr. Hamerlik asked whose land was involved. Mr. O’Leary responded that it is that land we will give the County – lots on the west side of S. 3rd St. – in the process of acquiring those buildings (all but one have been acquired). Mr. Carpenter said that preflood spaces were provided to businesses based on the number of employees. Mr. O’Leary explained that all businesses providing off street parking for their employees are credited for providing those spaces. He said the issue is how to assess this. He went on to say that in speaking to a handful of businesses in that area, they told him they were unlikely to use the ramp and don’t really want it. Mr. Hamerlik said he thinks we should contribute less and the County contribute more.

Mr. Malm said $1 million is as much as the County is willing to put into this and that is as far as they can go without going to the voters to increase the mill levy. He said if they don’t own the land under the ramp, they won’t get the money from the lender. He said they are stretching as far as they can go. He added that when the dike is built parking will not be allowed on the east side so all those spaces will be lost. Mr. Malm went on to say there are some buildings in the area that are on the National Register or of a historical nature and will likely be kept and there is just no other land available for parking. Mr. Carpenter asked if the plan still included covering Bruce Av. and Mr. Malm responded it did. Ms. Babinchak suggested getting rid of the old buildings and building the ramp with a different design to allow more spaces. Mr. O’Leary said the MET and a couple of other buildings are of great interest to the City and State Historical Societies. Ms. Babinchak then said it looks like the City will pay ¾ of the cost and the County owns it.

Mr. Hamerlik asked about the $600,000-$900,000 that is to be realized from the sale of surface lots in the path of the dike. Mr. Carpenter said we have to use those funds to develop lots for other businesses. In response to Committee questions, Mr. Malm said his opinion is that the ramp should be open to the public with no fees. He said he felt an obligation to the community since the City is contributing. He said they estimate approximately 700 people a day though their offices, most staying for less than one hour. Mr. Carpenter asked how many employees and Mr. Malm did not know for sure, but that some reserved spaces are planned and after that it would be first come, first served. Mr. Carpenter said if we approve, the County should own, operate and maintain the ramp and provide public parking.

Mr. O’Leary said there is one other option to place on the table. Put the City and County money in for the two-level and then add the $600-900,000 to the project to provide for the third level and special assess the balance to the users. He said that could be as much as $500-600,000 or as little as $300,000 and would provide 379 spaces - maybe the third level should be bid as an option and the extra 130 spaces could be negotiated for hourly use.

Mr. Carpenter asked what specific action needs to be taken tonight. Mr. Schmisek responded that we need to authorize the $2 million and turn it over to the County and they do the rest. He said we need to do more research on available funds. Mr. Hamerlik stated he has no doubt that we need the ramp and we should participate, but we don’t have deep pockets. He said if the ramp were brought to a three level with the $2 million he would lean toward favoring the project. Mr. Brooks said he would have trouble facing voters after contributing to a two-level ramp in addition to providing the land. Mr. Hamerlik said if we can’t afford a three-level now what other options or prospects are there. Mr. O’Leary said the problem will present itself in 3-4 years when the dike goes in. Mr. Christianson said we could gain more businesses within a couple of years and then have a greater ability to special assess. Mr. O’Leary said we could go ahead with the three levels, do nothing or delay. He said the urgency is that the numbers are based on an April start date, we need to begin the designs and specs to get a favorable bid in the winter months.

Mr. Carpenter asked if the County Commission has approved this. Mr. Malm responded that they made a motion to accept the $2 million from the City, commit $1 million of their own and not to exceed $3 million for the project. Mr. Hamerlik suggested we explore other options.
Mr. Carpenter then suggested that this item be held for the regularly scheduled Finance Committee meeting on December 21.

Meeting adjourned at 7:30 p.m.

Respectfully submitted, Carolyn Kryzsko, Executive Administrative Assistant

Respectfully submitted, LaVerne Babinchak, Finance Committee Chair