VII.2. Authorize Sale of $9,840,000 General Obligation Bonds Series 2021A; BishopMarch 1, 2021 Council Report 2022-021
AUTHORIZE SALE OF $9,840,000 GENERAL
OBLIGATION BONDS SERIES, 2021A
Proposed Action.
Staff recommends that the Council approve the following motion: Resolution 2022-016
Providing for the Sale of $9,840,000 General Obligation Bonds, Series 2022A.
Overview:
The Series 2022A bonds will be general obligations of the city for which it’s full faith, credit and
taxing powers are pledged. The preliminary authorization is for $9.84 million and will be
adjusted to reflect actual costs after construction contracts are awarded. The bonds are being sold
to finance five purposes.
• 2022 street improvement project for 6th Avenue South and 7th Avenue South. The bonds
for this purpose will be issued with a 16 year term to come from a general tax levy and
special assessments.
• 2022 & 2023 Mill and overlay projects on 10th Avenue North and 1st Street North. The
bonds for this purpose will be issued with a 10 year term to come from a general tax levy.
Issuance for the 2023 portion is being recommended based on currently low interest rates.
• Trunk Water Main Rehabilitation. The bonds for this purpose will be issued with a 15
year term to come from utility revenues.
• Equipment Purchases (Fire Truck and Dump Truck). The bonds for this purpose will be
issued with 10 year tem to come from a general tax levy.
• Current Refunding of 2014A Bonds with an estimated net present value savings of
$44,000. The bonds for this portion of the project will be issued for a 8-year term ending
in 2032 matching the original issuance. The bonds will continue to be funded from a
general tax levy, special assessments and transfers from utility funds.
Adopting the resolution will allow City Staff to work with its municipal advisor Ehlers &
Associates to prepare an official statement for the bond sale. The City’s last bond rating was
AA+ with a stable outlook. Standard and Poor’s will update the rating before bonds are sold.
City Council is scheduled to award the sale of bonds on April 5th.
Primary Issues to Consider
• None
Supporting Information:
• Resolution No. 2022-016
• Bond Pre-Sale Report
________________________________________
Nick Bishop, CPA
Finance Director
Financial Impact: $9,480,000 Bond Proceeds Source:Tax Levy & Special Assessments
Budgeted: Y/N Y Related Documents:
Capital Improvement Plan &
Equipment Replacement Plan
Notes:
Resolution No. 2022-016
Councilmember _________________ introduced the following resolution and moved its adoption:
Resolution Providing for the Sale of
$9,840,000 General Obligation Bonds, Series 2022A
A. WHEREAS, the City Council of the City of Hopkins, Minnesota has heretofore determined that it is
necessary and expedient to issue the City's $9,840,000 General Obligation Bonds, Series 2022A (the
"Bonds"), to finance the 2022 road and utility reconstruction projects, the 2022 and 2023 mill and
overlay projects, purchase of a fire truck and dump truck and a current refunding of the City's General
Obligation Bonds, Series 2014A in the City; and
B. WHEREAS, the City has retained Ehlers & Associates, Inc., in Roseville, Minnesota ("Ehlers"), as its
independent municipal advisor for the Bonds in accordance with Minnesota Statutes, Section 475.60,
Subdivision 2(9);
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hopkins, Minnesota, as
follows:
1. Authorization; Findings. The City Council hereby authorizes Ehlers to assist the City for the sale of
the Bonds.
2. Meeting; Proposal Opening. The City Council shall meet at 7:00 p.m. on April 5, 2022, for the
purpose of considering proposals for and awarding the sale of the Bonds.
3. Official Statement. In connection with said sale, the officers or employees of the City are hereby
authorized to cooperate with Ehlers and participate in the preparation of an official statement for the
Bonds and to execute and deliver it on behalf of the City upon its completion.
The motion for the adoption of the foregoing resolution was duly seconded by City Council Member
_______________________ and, after full discussion thereof and upon a vote being taken thereon, the
following City Council Members voted in favor thereof:
and the following voted against the same:
Whereupon said resolution was declared duly passed and adopted.
Dated this 1st day of March, 2022.
_____________________________________________
Amy Domeier, City Clerk
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City of Hopkins, Minnesota
$9,840,000 General Obligation Bonds, Series 2022A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 20bps
Total Issue Sources And Uses
Dated 04/26/2022 | Delivered 04/26/2022
Improvements Utilities
Mill and
Overlay Equipment
Current Ref
2014A -
Improvements
Current Ref
2014A - Street
Reconstruction
Issue
Summary
Sources Of Funds
Par Amount of Bonds $1,590,000.00 $5,065,000.00 $1,100,000.00 $970,000.00 $410,000.00 $705,000.00 $9,840,000.00
Prepaid Assessments 70,000.00 -----70,000.00
Total Sources $1,660,000.00 $5,065,000.00 $1,100,000.00 $970,000.00 $410,000.00 $705,000.00 $9,910,000.00
Uses Of Funds
Total Underwriter's Discount (1.200%)19,080.00 60,780.00 13,200.00 11,640.00 4,920.00 8,460.00 118,080.00
Costs of Issuance 16,320.12 51,988.31 11,290.65 9,956.30 4,208.34 7,236.28 101,000.00
Deposit to Capitalized Interest (CIF) Fund 22,500.35 -13,553.30 11,527.08 --47,580.73
Deposit to Project Construction Fund 1,600,000.00 4,950,000.00 1,065,000.00 935,000.00 --8,550,000.00
Deposit to Current Refunding Fund ----403,337.81 685,673.59 1,089,011.40
Rounding Amount 2,099.53 2,231.69 (3,043.95)1,876.62 (2,466.15)3,630.13 4,327.87
Total Uses $1,660,000.00 $5,065,000.00 $1,100,000.00 $970,000.00 $410,000.00 $705,000.00 $9,910,000.00
Series 2022A GO Bonds Ver | Issue Summary | 2/17/2022 | 9:12 AM
City of Hopkins, Minnesota
$9,840,000 General Obligation Bonds, Series 2022A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 20bps
Net Debt Service Schedule
Date Principal Coupon Interest Total P+I CIF Net New D/S Fiscal Total
04/26/2022 -----65,672.13 -
02/01/2023 135,000.00 0.800%131,360.24 266,360.24 (47,580.73)218,779.51 284,451.64
08/01/2023 --85,441.25 85,441.25 -85,441.25 -
02/01/2024 740,000.00 1.100%85,441.25 825,441.25 -825,441.25 910,882.50
08/01/2024 --81,371.25 81,371.25 -81,371.25 -
02/01/2025 750,000.00 1.250%81,371.25 831,371.25 -831,371.25 912,742.50
08/01/2025 --76,683.75 76,683.75 -76,683.75 -
02/01/2026 760,000.00 1.400%76,683.75 836,683.75 -836,683.75 913,367.50
08/01/2026 --71,363.75 71,363.75 -71,363.75 -
02/01/2027 760,000.00 1.450%71,363.75 831,363.75 -831,363.75 902,727.50
08/01/2027 --65,853.75 65,853.75 -65,853.75 -
02/01/2028 770,000.00 1.550%65,853.75 835,853.75 -835,853.75 901,707.50
08/01/2028 --59,886.25 59,886.25 -59,886.25 -
02/01/2029 790,000.00 1.600%59,886.25 849,886.25 -849,886.25 909,772.50
08/01/2029 --53,566.25 53,566.25 -53,566.25 -
02/01/2030 805,000.00 1.700%53,566.25 858,566.25 -858,566.25 912,132.50
08/01/2030 --46,723.75 46,723.75 -46,723.75 -
02/01/2031 670,000.00 1.850%46,723.75 716,723.75 -716,723.75 763,447.50
08/01/2031 --40,526.25 40,526.25 -40,526.25 -
02/01/2032 675,000.00 2.000%40,526.25 715,526.25 -715,526.25 756,052.50
08/01/2032 --33,776.25 33,776.25 -33,776.25 -
02/01/2033 575,000.00 2.100%33,776.25 608,776.25 -608,776.25 642,552.50
08/01/2033 --27,738.75 27,738.75 -27,738.75 -
02/01/2034 465,000.00 2.200%27,738.75 492,738.75 -492,738.75 520,477.50
08/01/2034 --22,623.75 22,623.75 -22,623.75 -
02/01/2035 470,000.00 2.250%22,623.75 492,623.75 -492,623.75 515,247.50
08/01/2035 --17,336.25 17,336.25 -17,336.25 -
02/01/2036 480,000.00 2.300%17,336.25 497,336.25 -497,336.25 514,672.50
08/01/2036 --11,816.25 11,816.25 -11,816.25 -
02/01/2037 495,000.00 2.350%11,816.25 506,816.25 -506,816.25 518,632.50
08/01/2037 --6,000.00 6,000.00 -6,000.00 -
02/01/2038 500,000.00 2.400%6,000.00 506,000.00 -506,000.00 512,000.00
Total $9,840,000.00 -$1,532,775.24 $11,372,775.24 (47,580.73)$11,390,866.64 -
Significant Dates
Dated 4/26/2022
First Coupon Date 2/01/2023
Yield Statistics
Bond Year Dollars $77,911.67
Average Life 7.918 Years
Average Coupon 1.9673244%
Net Interest Cost (NIC)2.1188807%
True Interest Cost (TIC)2.1215971%
Bond Yield for Arbitrage Purposes 1.9536198%
All Inclusive Cost (AIC)2.2675610%
IRS Form 8038
Net Interest Cost 1.9673244%
Weighted Average Maturity 7.918 Years
Series 2022A GO Bonds Ver | Issue Summary | 2/17/2022 | 9:12 AM
City of Hopkins, Minnesota
$9,840,000 General Obligation Bonds, Series 2022A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 20bps
Detail Costs Of Issuance
Dated 04/26/2022 | Delivered 04/26/2022
COSTS OF ISSUANCE DETAIL
Municipal Advisor $65,500.00
Bond Counsel $16,500.00
Rating Agency Fee $18,000.00
Miscellaneous $1,000.00
TOTAL $101,000.00
Series 2022A GO Bonds - P | Issue Summary | 2/21/2022 | 10:15 AM
City of Hopkins, Minnesota
$9,840,000 General Obligation Bonds, Series 2022A
Issue Summary
Assumes Current Market BQ AA+ Rates plus 20bps
Debt Service Schedule
Date Principal Coupon Interest Total P+I CIF Net New D/S 105% of Total Assessments
Utility
Revenues Levy/ (Surplus)
02/01/2023 135,000.00 0.800%131,360.24 266,360.24 (47,580.73)218,779.51 229,718.49 -75,768.80 153,949.69
02/01/2024 740,000.00 1.100%170,882.50 910,882.50 -910,882.50 956,426.63 30,426.67 414,188.25 511,811.71
02/01/2025 750,000.00 1.250%162,742.50 912,742.50 -912,742.50 958,379.63 29,642.67 415,973.25 512,763.71
02/01/2026 760,000.00 1.400%153,367.50 913,367.50 -913,367.50 959,035.88 28,858.67 417,220.13 512,957.08
02/01/2027 760,000.00 1.450%142,727.50 902,727.50 -902,727.50 947,863.88 28,074.67 417,913.13 501,876.08
02/01/2028 770,000.00 1.550%131,707.50 901,707.50 -901,707.50 946,792.88 27,290.67 413,117.25 506,384.96
02/01/2029 790,000.00 1.600%119,772.50 909,772.50 -909,772.50 955,261.13 26,506.67 413,240.63 515,513.83
02/01/2030 805,000.00 1.700%107,132.50 912,132.50 -912,132.50 957,739.13 25,722.67 418,364.63 513,651.83
02/01/2031 670,000.00 1.850%93,447.50 763,447.50 -763,447.50 801,619.88 24,938.67 417,724.13 358,957.08
02/01/2032 675,000.00 2.000%81,052.50 756,052.50 -756,052.50 793,855.13 24,154.67 416,466.75 353,233.71
02/01/2033 575,000.00 2.100%67,552.50 642,552.50 -642,552.50 674,680.13 23,370.67 414,576.75 236,732.71
02/01/2034 465,000.00 2.200%55,477.50 520,477.50 -520,477.50 546,501.38 22,586.66 417,469.50 106,445.22
02/01/2035 470,000.00 2.250%45,247.50 515,247.50 -515,247.50 541,009.88 21,802.66 414,519.00 104,688.22
02/01/2036 480,000.00 2.300%34,672.50 514,672.50 -514,672.50 540,406.13 21,018.66 416,514.00 102,873.47
02/01/2037 495,000.00 2.350%23,632.50 518,632.50 -518,632.50 544,564.13 20,234.66 418,078.50 106,250.97
02/01/2038 500,000.00 2.400%12,000.00 512,000.00 -512,000.00 537,600.00 19,450.66 413,952.00 104,197.34
Total $9,840,000.00 -$1,532,775.24 $11,372,775.24 (47,580.73)$11,325,194.51 $11,891,454.24 $374,080.00 $6,315,086.67 $5,202,287.56
Significant Dates
Dated 4/26/2022
First Coupon Date 2/01/2023
Yield Statistics
Bond Year Dollars $77,911.67
Average Life 7.918 Years
Average Coupon 1.9673244%
Net Interest Cost (NIC)2.1188807%
True Interest Cost (TIC)2.1215971%
Bond Yield for Arbitrage Purposes 1.9536198%
All Inclusive Cost (AIC)2.2675610%
Series 2022A GO Bonds Ver | Issue Summary | 2/17/2022 | 9:12 AM
City of Hopkins, Minnesota
$410,000 General Obligation Bonds, Series 2022A
Current Ref 2014A - Improvements
Debt Service Comparison
Date Total P+I
Net New
D/S Old Net D/S Savings
02/01/2023 54,270.14 56,736.29 57,137.50 401.21
02/01/2024 55,190.00 55,190.00 55,787.50 597.50
02/01/2025 54,640.00 54,640.00 59,437.50 4,797.50
02/01/2026 54,015.00 54,015.00 57,937.50 3,922.50
02/01/2027 53,315.00 53,315.00 56,437.50 3,122.50
02/01/2028 52,590.00 52,590.00 54,937.50 2,347.50
02/01/2029 56,815.00 56,815.00 58,437.50 1,622.50
02/01/2030 55,935.00 55,935.00 56,718.76 783.76
Total $436,770.14 $439,236.29 $456,831.26 $17,594.97
PV Analysis Summary (Net to Net)
Gross PV Debt Service Savings.....................18,795.38
Net PV Cashflow Savings @ 1.954%(Bond Yield).....18,795.38
Contingency or Rounding Amount....................(2,466.15)
Net Present Value Benefit $16,329.23
Net PV Benefit / $421,208.64 PV Refunded Debt Service 3.877%
Net PV Benefit / $400,000 Refunded Principal...4.082%
Net PV Benefit / $410,000 Refunding Principal..3.983%
Refunding Bond Information
Refunding Dated Date 4/26/2022
Refunding Delivery Date 4/26/2022
Series 2022A GO Bonds Ver | Current Ref 2014A - Impro | 2/17/2022 | 9:12 AM
City of Hopkins, Minnesota
$705,000 General Obligation Bonds, Series 2022A
Current Ref 2014A - Street Reconstruction
Debt Service Comparison
Date Total P+I
Net New
D/S Old Net D/S Savings
02/01/2023 92,348.61 88,718.48 95,631.26 6,912.78
02/01/2024 93,940.00 93,940.00 98,381.26 4,441.26
02/01/2025 93,005.00 93,005.00 95,981.26 2,976.26
02/01/2026 96,942.50 96,942.50 98,581.26 1,638.76
02/01/2027 90,682.50 90,682.50 96,031.26 5,348.76
02/01/2028 94,450.00 94,450.00 98,481.26 4,031.26
02/01/2029 93,055.00 93,055.00 95,781.26 2,726.26
02/01/2030 96,615.00 96,615.00 97,968.76 1,353.76
Total $751,038.61 $747,408.48 $776,837.58 $29,429.10
PV Analysis Summary (Net to Net)
Gross PV Debt Service Savings.....................24,173.11
Net PV Cashflow Savings @ 1.954%(Bond Yield).....24,173.11
Contingency or Rounding Amount....................3,630.13
Net Present Value Benefit $27,803.24
Net PV Benefit / $716,116.72 PV Refunded Debt Service 3.883%
Net PV Benefit / $680,000 Refunded Principal...4.089%
Net PV Benefit / $705,000 Refunding Principal..3.944%
Refunding Bond Information
Refunding Dated Date 4/26/2022
Refunding Delivery Date 4/26/2022
Series 2022A GO Bonds Ver | Current Ref 2014A - Stree | 2/17/2022 | 9:12 AM
City of Hopkins, Minnesota
$280,000 General Obligation Bonds, Series 2022A
Assessments
2.0% over TIC - Equal Principal
Assessments
Date Principal Coupon Interest Total P+I
12/31/2023 18,666.67 4.200%11,760.00 30,426.67
12/31/2024 18,666.67 4.200%10,976.00 29,642.67
12/31/2025 18,666.67 4.200%10,192.00 28,858.67
12/31/2026 18,666.67 4.200%9,408.00 28,074.67
12/31/2027 18,666.67 4.200%8,624.00 27,290.67
12/31/2028 18,666.67 4.200%7,840.00 26,506.67
12/31/2029 18,666.67 4.200%7,056.00 25,722.67
12/31/2030 18,666.67 4.200%6,272.00 24,938.67
12/31/2031 18,666.67 4.200%5,488.00 24,154.67
12/31/2032 18,666.67 4.200%4,704.00 23,370.67
12/31/2033 18,666.66 4.200%3,920.00 22,586.66
12/31/2034 18,666.66 4.200%3,136.00 21,802.66
12/31/2035 18,666.66 4.200%2,352.00 21,018.66
12/31/2036 18,666.66 4.200%1,568.00 20,234.66
12/31/2037 18,666.66 4.200%784.00 19,450.66
Total $280,000.00 -$94,080.00 $374,080.00
Significant Dates
Filing Date 1/01/2023
First Payment Date 12/31/2023
Series 2022A GO Bonds - A | SINGLE PURPOSE | 2/17/2022 | 9:09 AM