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City of Hopkins - Financial Plan for the Facilities Redevelpment Project , " . June 25, 2002 FINANCIAL PLAN FOR THE FACILITIES REDEVELOPMENT PROJECT Overview The City of Hopkins is finalizing the financial plan for providing funds needed to build a new fire station, a new public works storage facility and the remodel of the old fire station and police station for the police. Staff has met with Mark Ruff, consultant from Ehlers and Associates, Steve Bubal, attorney from Kenedy and Graven and Jerry Steiner, the city attorney. Several items regarding the redevelopment plan were discovered, discussed and resolved. Financin2 Staff was directed to derive a financial plan for the redevelopment project that provides the needed resources for the project at the most reasonable cost for city tax payers. After much deliberation, it has been determined that issuance of HRA lease revenue bonds will be the most cost efficient and effective tool to provide the funds for the project. Taxes will be levied to pay back the bonds over twenty years. The levy is applied to tax capacity instead of market value. CornmerciallIndustrial and Apartment owners will pay a slightly greater share of the taxes than if a referendum levy is applied. HRA lease revenue bonds do not require voter approval. . Projected costs New fire station $ 4,369,000 Public Works addition 4,374,000 Site work 632,000 School Parking/road reconstruct 750,000 Soft costs 545,000 Police remodel 1 ,835,000 Total Project Costs 12,505,000 Adjust for 2003 construction (5%) 625,000 Cost of bond issuance 59,500 Bond discount 175,500 Total Bond Issue $13,365,000 The above costs are a combinatlon of the fire and public works facility costs projected by the consultant, $150 per square foot for remodeling the current fire and police station, bond issuance costs and a 10% adjustment for building in 2003 and 2004, (costs are based on 2001). You will note that above is a more specific breakdown of costs relative to the redevelopment project as compared to the flyer that was distributed. The impact for the average ($150,000) residential property owner remains at approximately $10 - $12 per month and the impact to the average ($500,000) commercial/industrial property remains at approximately $64 - $74 per month. . . Our financial tool has changed from a combination of HRA Lease Revenue Bonds and Sewer Revenue Bonds to strictly HRA Lease Revenue Bonds. Instead of issuing revenue bonds through the Sanitary Sewer fund, the utility funds will pay a lease payment equal to the amount of debt the utility funds were going to pay for a bond issue. This will offset the increase in the HRA Lease Revenue debt service payments and hold the debt levy's at the amounts projected. The intent is to issue approximately $5,665,000 in HRA Lease Revenue Bonds in early fall of 2002 and $7,700,000 in HRA Lease Revenue Bonds in the spring or summer of 2003. The timing of these bond issues could fluctuate depending on progress of the redevelopment. The amounts of the issues could also fluctuate based on bids for construction and other revenue sources. The School District has been approached to help pay for the relocation of the parking lot for their use, to the proposed location. If approved, the School District intends on contributing $350,000 towards the relocation costs associated with the parking lot which would reduce the city's contribution for relocation of the parking lot. Our legal and financial consultants are working with staff to ensure our success with this project. . . ~7 F~; I ~-ke.'S P"';;J~ - (lPP 't5~ Grooters, Leapaldt, Tideman . fhitects . IJ t! Setter Leach & Lindstrom Inc_ A ~ COl.ut House Square ... "-" 730 2nd Ave, So., Suite 1100 ~ t. Cloud, MN 56303 Minneapolis, ~ Collaborative Design Group A.. E"" Buetow & Associates Inc. 1501 Washington Ave. So., Suite Boarman Kroos Vogel Group Inc. 2345 Rice Street A"~ 205 222 No. 2nd Street A"'~ Roseville,:MN 55113 Minneapolis, 1vIN :Minneapolis, M:N 55401 SEH Luken Architecture P A LundaW Architects Butler Square Building A - G' 322 1st Ave No A-~ 4627 Pleasantwood Road 1J-6: Suite 71 DC 1vllnneapolis, 1vIN 55401 Minnetonka,:MN 55343 Minneapolis, MN Kraus Anderson E & V Consultants & Construction Minneapolis Division tM Managers (...('1\. Ameon c,~ 525 So. 8th Street 5801 Duluth St 200 W. Hwy 13 Minneapolis, MN 55404 Golden Valley, MN 55422 Burnsville,:MN 55337 M.A. Mortenson Co. Bossardt Corporation C"^' Trossen Wright Architects 700 Meadow Lane No. c:.M 8585 W. 78th St. 3242 Rice St. A.. ~ .1neapolis,~ 55422 Bloomington, MN 55438 Little Canada, l\.1N Miller-Dunwiddie Associates Inc. TSP Architects & Engineers 123 No. 3rd 5t jl-€ 21 Water 5t. tl'^. Minneapolis,:MN 55401 Excelsior,11N 55331 .