HomeMy WebLinkAboutCouncil Workshop Minutes 05.13.2008MINUTES
COUNCIL WORKSHOP
MAY 13, 2008 6:30 P.M.
COUNCIL CHAMBERS
A Cauncil Workshop was held in the Council Chambers and called to order by Mayor Ken Olson at 6:30
p.m. on May 13, 2008.
COUNCIL MEMBERS PRESENT:
x Emelie Eaton (d:55 p.m.)
_x Kate Hart
_x Gay Easton
x Alex Wilkins
_x Doug Poehls
_x Mark Mace
_x Chuck Dickerson
_x Norm Stamper
OTHERS PRESENT-
Sarn Painter
Mary Embleton
Bill Sheridan
Kurt Markegard
Scott Wilm
Jan Faught
James Caniglia
Rick Mussan
Patrick Murtagh, Great West Engineering
Chad Hanson, Great West Engineering
Stefan Streeter, MDT
Gary Neville, MDT
Public Input (three-minute limit):
Citizens may address the Council regarding any item of City business not an the agenda The duration for an individual
speaking under Public Input is limited to three minutes. While all comments are welcome, the Council will not take action on
any item not on the agenda.
There was none.
Cit of Laurel Volunteer Ambulance Service:
+ Appointments of Crew Members: Brandon Ihde, Alyssa Francis, Gaylen Hocking
Ambulance Director Jan Faught introduced two new volunteers for the Laurel Ambulance Service.
Gaylen Hocking, who has been an EMT since 1987 and last worked in Pueblo, Colorado, is now living in
Laurel. Brandon Ihde worked for Glendive EMS, is currently employed as a Billings police officer, and
lives in Laurel. Jan asked for the council's approval of the appointments next week.
Stefan Streeter, Montana Department of Transportation:
• Presentation of timelines and dates for construction projects in the City of Laurel
Kurt Markegard introduced Stefan Streeter, who is the new Billings District Administrator for the
Department of Transportation.
Stefan Streeter stated that Bill Sheridan asked him to talk about the projects that the Department of
Transportation is working on in and around Laurel. Since Stefan is new at the job, he brought Gary
Neville with because he has worked on the projects longer.
Stefan stated that there are about eight projects in and about Laurel. The first project is Rockvale /Laurel,
which starts at the edge of Laurel and goes to Rockvale and is a proposed four-lane highway. MDT hopes
that the environmental study will be done this year. They are through the draft EIS and have fmalized all
Council Workshop Minutes of May 13, 2008
the public meetings. MDT hopes to have a record of decision from the Federal Highways by the end of
the yeaz. Once that is received, MDT can move on to the design phase.
The next project is the West Laurel Interchange. A public meeting was held on the project in December.
Currently, MDT has a ready date for 2011 to have the plans ready to go. Currently, it is not in MDT's
five-yeaz funding plan, so funding options will have to be reviewed.
The Laurel Northeast Project is set for November letting and is tied with the turn lane project. The project
has reconstruction of three lanes out to the railroad overpass and mill and fill is involved in it.
The Main Street, Third to Eighth, project is a combination project between the City of Laurel, the
Department of Transportation and MDT's maintenance forces.
The Eighth Avenue, Main to Ninth, project has funding issues and MDT is continuing on with the design.
A plan review was recently held in Billings, and Kurt and Bill attended the meeting. Stefan stated that the
very eazliest there could be adequate urban funds is around 2013. Inflation and other things could affect
that, and funding will need to be determined.
The CTEP Street Bike Pedestrian Bridge project in Laurel should be completed within the next couple
weeks.
Three tied projects are to contract now. These include: Eighth Avenue, 12th Street to 9th; Maryland Lane,
Washington to 8th Avenue North; and West 12a' Street, 5th Avenue to 8th. The Pazk City to Laurel project
will be a chip seal and guard rail upgrades.
Stefan told the council to contact him with questions or if the city needs anything from the Department of
Transportation pertaining to maintenance, construction, ar design.
There was discussion regarding the northeast project and the turn lane project. Gary Neville stated that
the reconstruction part is from Alder to Milwaukee. Some curb, gutter, and sidewalk will be installed.
The project starts at the interstate, goes under the underpass and out to the end of the East Laurel
interchange. The mill and fill will be about two inches and the siphon pipe that leaks will be replaced.
The little pork chop on Railroad Avenue will be removed and some ADA improvements will be done.
The project wi111et in November for construction next spring. Cold millings will be available.
Great West En ineerin Chad Hanson and Patrick Murta h:
• Task Order No. 3 -Storm water project on South 1St Avenue (including South 4th Street)
Kurt introduced Chad Hanson and Patrick Murtagh to give an update on the two task orders.
Chad Hanson gave an update on the two task orders. Task Order No. 3 is far the storm water system in
the southeast business district. Bill and Kurt have been working on the potential SID. The business
owners aze for it but aze not excited about the costs. Great West is looking at cutting the scope of the
project, taking out the mill and overlay an Southeast 4th and the storm sewer on Washington Avenue for
now. As Stefan presented, MDT plans to mill and overlay South First Avenue first thing next spring. If
the city is going to put storm sewer in there, it needs to be done before MDT fixes that street.
Bill has asked Great West to start on the design. They are working on funding scenarios of the scaled-
back project and looking at an SRF loan versus bonding because there is not time to do a traditional bond
with the SID. They will provide different scenarios for funding the storm water project running down
First Avenue South, south to Town Pump, and then down Southeast 4th Street to tie into the big main
2
Council Workshop Minutes of May 13, 2008
running down Bernhazdt Road. Public Works identified about two blocks of sanitary sewer that needs to
be replaced before the street project. The Sewer Fund has the money akeady dedicated fox main line
replacement.
Kurt stated that the sanitary sewer line is an old cast iron water line, which is not cop esthetic with
sewage. This line is on the city's list for monthly jet roddings. Public Works is in the process of getting
the line videaed in order to determine the urgency of it, but it needs to be replaced before the project is
paved. Chad stated that the sewer fund for the sewer system has line items for main line replacement that
should cover the estimates for the design. The survey is done and they are just starting the base maps.
Mayor Olson stated that this will require council action and the city will make every effort to have this in
place.
Chad stated that Great West will continue to work on different funding scenazios and will refine them
with Bill and Mayor Olson prior to presentation to the council.
• Task Order No. 6 -Water Treatment Plant
Chad stated that Task Order No. 6 is for the water system The update to the PER was completed, and Pat
is the project manager for that. The TSEP Grant application was submitted by the May 2"d due date. The
DNRC grant application is due May 15~' and is ready to be mailed.
Chad stated that, after visiting with Tim at the Water Plant, there is more urgency to some issues than
originally thought. So the proposed Phase 1 is bigger than initially anticipated. Since a bigger project
requires more engineering, Chad presented Amendment No. 1 to Task Order No. 6. They used the same
percentages of estimate construction casts to calculate engineering, construction, administration, and grant
administration. The contract increased from $399,000 to $497,000.
Chad stated that after the grants aze submitted, it is a very drawn out process as they aze reviewed
throughout the summer. There will be an indication of the rankings this fall and the grant approval will be
done next spring in the legislature session. It would be next June before the money is released. Chad
stated that a lot of concerns aze starting to arise at the water system. Bill and Kurt have been approached
by different developers that want to expand. With the phased system to keep doing these improvements
and adding an, you have to keep building up on it. Chad stated that the grant funds provide less than 20
percent of the funding and the engineering design comes out of the city's reserves from the water fund.
Chad stated that Great West would like to start the design now, move everything up a whale yeaz, and be
ready to go when the grant funding is received from TSEP next June. Bidding for construction could then
begin and the whole project would move up a whole year. Chad stated that there aze developers that want
to get into Phase 2 sooner because it is needed for development. He asked for the council's input.
Chad stated that this project needs to go forwazd whether or not the grant is received. The grant funding
makes up a small percentage because it is such a large project. The whole project budget is over $3
million and the grant would be for $850,000. Grants aze scored on different things, including need and
the engineering report. Management is one aspect, and the fact that the city has had grants in the past and
has done a good job of managing them using the funds is important. Since the staff did a good job of
keeping track of past grants, the city scores well on fixture grants.
Mayor Olson spoke regazding the Amendment to the 2007 Report for the Water Facility Plan. He stated
that there will be rapid growth in the next two or three yeazs and the city must be prepazed for the
anticipated needs. Once the interchange is built in 2011, the services need to be available for future
growth.
3
Council Workshop Minutes of May 13, 2008
Chad stated that each phase is built an the other phase. Phase 1 needs to be done and they are looking at
doing a portion of Phase 2 sooner than anticipated. Phase 2 would include a tank and a line to connect it.
The tank will be vital for fire protection throughout the city. Not only would it improve fire protection
drastically in zone 2, it will improve fire flows in every corner of the town. There is discussion regarding
general obligation bonds far a new fire hall. Chad is exploring options of adding the money for the tank,
which js for fire protection, to the general obligation bond for the fire hall to tie it all together.
Chad gave the amendments for Task Order No. 3 to Mayor Olson. There will be further discussion
regarding whether or not the city should move forward with design of the project. An update will be
presented at the council workshop on May 27~'.
Patrick Murtagh stated that there is an increase in the engineering contract for the additional work. That
was included in the previous presentations made when he talked about cost per user and costs of the
project. He also stated that they had a meeting with a developer who wanted to put the tank in a little
different place. Great West did more hydraulic modeling and can make it work if the pipe is extended a
little bit further. Pat emphasized that it would be a good time for them to move into the design phase.
That is acceptable to TSEP once the grant application is submitted if the city wants to spend its money
towazds that.
Fire Department:
• Resolution -Yellowstone Boys and Girls Ranch Fire Contract
• Resolution -Laurel Airport Authority Fire Contract
Fire Chief Wilm stated that the signed contracts aze ready for council approval. The resolutions will be on
the May 20`" council agenda.
Police Department_
• Resolutions - 2008-2009 SRO Agreements
Chief Musson stated that the resolutions for the SRO agreements are ready far another yeaz. The
resolutions will be on the May 20t" council agenda.
Plaiuiing,Board:
• Discussion -Russell Park
James Caniglia distributed a map of Russell Pazk that showed the park and the surrounding azeas. The
issue is that the city has some lots that aze not dedicated park that aze alongside the pazk. Platted streets
run through what looks to be park, but actually is not park. A homeowner lives next to the street and has
been parking on the street, even though it looks like pazk. Last time James talked about Cedar Avenue.
Maple Street is another issue as it is also platted, is two lots of about 13,000 squaze feet, and is the
location of the pazk amenities, such as the restrooms. James stated that it may be beneficial to dedicate
the azea as a pazk and abandon Maple Street. The council could decide to sell the lots. On the west side,
just north of the freeway, there are five lots of about 25,200 squaze feet. It is not well connected to the
pazk and is not very useable in terms ofthe rest of the pazk. The city could sell the lots, a developer could
build there, or the city could dedicate the azea as a pazk. A developer would have to loop water and sewer
and put in some drastic improvements on Cedaz Avenue. The street is there but a developer would need
to dig up the dirt and put in some street improvements. The only other access to those lots is a very
narrow gravel alley. If a developer chose to spend the money to loop the sewer and water and put in the
street improvements, they could build a maximum of eight units in the 25,000 squaze feet. The developer
could pay for paving half the street and the city could pay for the other half. That would provide
4
Council Workshop Minutes of May 13, 2008
additional parking for the pazk. James asked for direction from the council regadding the best use for the
land, whether it is for development or as a park.
There was discussion regarding the value of the land, which James estimated to be about $2.00 to $3.00 a
square foot. Mazk asked if the funds would be dedicated to parks or used in the General Fund. Mary
stated that because that is a General Fund asset, the city would not be able to use it for parks. The city
could use the money for parks ifwe sold park land, but General Fund asset proceeds could be used for any
thing General Fund related.
Mayor Olson stated that the issue needs to be presented to the Park Boazd for input and a
recommendation.
Executive review:
• Job description - Chief Administrative Officer
Mayor Olson removed this from tonight's agenda and placed it on the May 27th council workshop agenda.
• Funding for future fire hall facility
Mayor Olson asked Mary to present the information on GO bonds. Mary stated that she distributed the
statutory requirements that aze applicable for general obligation funding of a big dollar amount. She
explained that it was necessary to make some assumptions to build a scenario. The bonding limitation
used to be 1.51 percent of the assessed value and was increased to 2.S percent of the assessed value. After
applying the 2.S percent to the city's current assessed value, the bonding limitation is a little over $S
million. However, once the city has reached its debt limitation in the General Fund, it cannot borrow any
more money. The best management would be to borrow less than the maximum. A figure of $4 million
was used as a starting point to build it. Mary explained the process for general obligation bonds. First,
bond counsel is needed. She contacted Dorsey & Whitney, who gave her a ball park figure of $11,000 to
do a $4 million bond issue. Second, a financial adviser is needed to market the bonds. Aazon Rudio, from
D. A. Davidson in Great Falls, created the scenazio sheet on what the impact would be to taxpayers for
this amount of money. He has said that bond markets currently are in good shape. A six percent interest
rate was used for this scenario, but it would probably be lower. Mary explained the timefrarne to do a
bond. Costs are needed first, then the city needs to educate the voters on the issue, and then the election
date needs to be determined. The timeframe from the time the city wants to call for an election and the
time the election is held is 7S days. If a resolution to call for an election is passed in mid-August, the
election could be held in November. If the voters vote yes in the election, the bonds could be sold and the
monies could come in for construction. The city would start paying back the bonds the following
November or December when taxes aze received. AGO bond is a separate mill levy outside of the
restrictions and requirements used to build the budget. The separate mill levy is outside I-lOS maximum
requirements.
Mayor Olson stated that the fire department will give a presentation on May 27th on the proposed fire
facility. The council will have ample opportunity to formulate questions regarding this important issue.
Doug asked regazding tying the water reservoir with this issue because his concern is that the city does not
want to spend all afthe $S million that is available.
Mayor Olson stated that the city will be seeking answers to all the questions. He spoke regarding the
Amendment to the Water Facility Plan that was presented by Great West Engineering and the fire flows
needed for fire protection.
Mayor Olson thanked Mary for the presentation.
S
Council Workshop Minutes of May 13, 2008
• Creation of TIF District Committee
Mayor Olson, Steve Zeier, Mary, Bill, James, and Sam met recently to discuss the formation of a TIFD
Committee. He stated that the committee should be formed before the city actually has the TIFD funds.
He will contact Bruce McCandless, who has been very involved with the TIFD creation in Billings. There
are guidelines regarding the TIFD recommendation board, and Mayor Olson will bring those forward in
the next month ar so far council approval. The final determination on funding for the TIFD is the
council's decision.
• Discussion - Heating/cooling issues in the two-story building of city hall
Mayor Olson stated that the issues are in the city court and public works areas. Two yeazs ago,
approximately $13,000 was dedicated for this capital project. However, it was not reallocated in the
budget the following yeaz, so there is no funding available now. Bill Sheridan contacted some HVAC
companies that studied the facility and presented recommendations, which were higher than expected.
The electrical issues also need to be addressed. Since Bill was unable to attend this meeting, Mayor Olson
stated that the item will be on the May 27th council workshop agenda.
• Council issues:
o Electronic signs (Mazk Mace)
Mazk stated concern regarding electronic signs and suggested that the city should review the issue before
it gets out of hand.
James stated that the city has regulations in terms of animation on signs. In the regulations, an animated
sign is defined as any sign that uses movement or change or lighting to depict action or create a special
effect or scene. Bright objects, explosions, and such are not allowed. Messages aze allowed and the
screen can change as often as wanted under city regulations. Billings allows a message to be changed
only every six seconds. Most cities have regulations that only allow a message to change so often so it is
not as much of a distraction to drivers. Some of the city's codes and definitions are open to interpretation
and aze rather vague. The regulations can be changed to regulate the number of messages on the boards.
James stated that there could be signs in town that do not conform to the regulations that were passed
through. He will find the applications and continue to research the issue. Mark gave James a copy of the
Billings' ordinance.
o Update on Peaks to Prairie -payment for bike trail (Chuck Dickerson)
Kurt stated that Bill made contact with the organization, which had received the money and was waiting
to issue the check.
Chuck asked how it happened that the project was done and then the council voted on the resolution after
the fact.
Mayor Olson stated that Peaks to Prairies contacted Bill regarding installing and paying for the asphalt
path. Mayor Olson authorized it without thinking about the need for a contract. He accepted
responsibility far the way it was presented. The clerk/treasurer brought the need for a small services
contract to his attention, and he is trying to make the process work out.
Kate stated that this event was presented to the Pazk Board and was discussed with Bill. It was a time
sensitive type issue. As far as the payment, when Kate talked to the organization this morning, she was
told that the funding they get does not come directly. It takes two weeks to clear the funds and that is why
6
Council Workshop Minutes of May 13, 2008
they could not present the check the day the race ended. The funds were raised before they committed to
paying for the project.
o Intersection of Airport Road and Buffalo Trail (Chuck Dickerson)
Chuck stated concern about the location of the speed limit signs when going north on Buffalo Trail. The
signs are located about 25 to 50 yards south of the intersection to Airport Road to Buffalo Trail. He
asked that the proper entity be contacted to have the signs placed 25 to 50 yards north of the intersection
far safety reasons. There was further discussion. Mayor Olson suggested placing the issue on the Joint
City/County Meeting agenda for Thursday, May 22'x.
Gay mentioned that there is a "Dead End" sign at the Laurel Cemetery. The whole signage issue should
be brought up at the joint meeting. Kurt stated that there have been complaints about the inappropriate
"Dead End" sign from people in funeral processions. A "Not a Thru Street" sign could be installed in its
place.
Chuck asked about the status of the speed limit sign on First Avenue South. Kurt stated that Bill drafted a
letter and sent it to the State DOT requesting a response. Chuck asked that this be on the May 27t~ council
workshop agenda.
Other items:
There were none.
Review of draft council a enda for Ma 20 200$:
• Ceremonial Calendar: Poppy Day Proclamation
The Poppy Day Proclamation will be on the May 20'~ council agenda.
A resolution approving Amendment No. 1 to Task Order No. 6 with Great West Engineering will be
added to the council agenda.
Attendance at the May 20~' council meeting
Doug will not be able to attend.
Announcements:
The Joint City/County Meeting is scheduled for Thursday, May 22°d, at 5:30 p.rn.
Chuck stated that the Elected Officials Workshop last week was rewarding. He thanked Mary for the fine
job she did in putting it together again.
Mayor Olson stated that he always enjoyed attending the workshops. He stated appreciation for Mary's
work for the Clerk's Association.
Norm stated his appreciation for the city's stafF. The council has some big decisions coming up, but the
staffdoes the preliminary work. He extended his thanks to the staff.
Mayor Olson thanked all of the department heads for their dedicated work for the City of Laurel.
Emelie Eaton was appointed to a steering committee by the Montana Historical Society and attended a
meeting in Helena this week. The committee is the Montana County History Initiative, and the members
were divided into the six districts that the Tourism Board already established far the state. Laurel is in the
Custer Country District. The idea behind the steering committee resulted from two staff members from
7
Council Workshop Minutes of May 13, 2008
the Historical Society discussing why the Historical Saciety did not do a better job of outreach to the four
corners of the state. Emelie received information from every department of the Historical Saciety, the
Census Bureau, the Montana State Library, and others. District meetings will be held and will benefit
areas east of Billings. Emelie mentioned that the Historical Society gave each member a recorder to take
oral histories. She will review the idea of taking oral histories for the centennial celebration.
Mayor Olson mentioned that Emelie and Gay are compiling asixty-page booklet with pictures and
narrative for the Centennial Celebration. Mayor Olson stated that he is glad Emelie got the position and
knows she will do it well.
Mayor Olson stated that a CIP meeting with Miral Garnradt has been scheduled for Saturday, June 7th, for
the council and department heads. Dr. Ken Weaver and Judy Mathre will moderate the meeting and
department heads will speak about their CIP requests.
The 4th of July Committee will meet on Thursday, May 15th, at 5:30 p.m. in the council chambers. The
Centennial Committee will meet at 7:00 p.m. on Thursday, May 15th.
Mary thanked the council for allowing her to attend the Clerks Institute last week and for support in her
membership in the Montana Municipal Clerks Treasurers and Finance Officers Association. At Institute,
MMIA emphasized the need for background checks on the volunteer ambulance and firemen. Since the
city's policies will be reviewed, Mary suggested considering this issue if it is not adequately addressed.
Mary stated that 103 clerks, 80 elected officials and 50 city attorneys attended. Dan Clark is the new
director of the Laval Government Center and will make a great director. A lot of the credit goes to the
Education Committee of the organization for putting the curriculum together in conjunction with the
Local Government Center.
Mary attended a meeting with the Montana Board of Investments today. Information about the meeting is
available in her office.
The council workshop adjourned at 8:09 p.m.
Respectfully submitted,
~~z~ C.Z.~~.-L,
Cindy Allen
Council Secretary
NOTE: This meeting is open to the public. This meeting is for information and discussion of the
Council far the listed workshop agenda items.
8
• Information on General Obligation Bonds
As a Funding Method for
Proposed New Fire Hadl
S/1/OS
This document is provided as information regazding process, tune frames, and costs as the Laurel
City Council deliberates on the issue of a new fire hall.
Process•
Currently, staffis using a figure of $4,000,000 as the total cost ofbuilding a new Fire Hall,
including site purchase. The recommended funding for this amount would be the
issuance of debt in the form of a General Obligation Bond.
The following aze some excerpts from Montana Code Annotated regazding Municipal General
Obligation Bonds to build a new Fire Hall:
7-7-4201. Limitation on amount of bonded indebtedness. (1) Except as provided in 7-7-4202,
a city or town may not issue bonds or incur other indebtedness for any purpose in an
amount that with all outstanding and unpaid indebtedness exceeds 2.5% of the total
assessed value of taxable property, determined as provided in 15-8-111, within the city or
• town, as ascertained by the last assessment for state and county taxes:
(2) The issuing of bonds for the purpose of funding ar refunding outstanding warrants
or bonds is not the incurring of a new or additional indebtedness but is merely the
changing of the evidence of outstanding indebtedness.
(3) The limitation in subsection (1) does not apply to bonds issued for the repayment
of tax protests lost by the city or town.
7-7-4203. What constitutes a single purpose. The following shall be deemed a single purpose:
(1) acquiring land for a site for a public building or for any other public use and
constructing, erecting, or acquiring by purchase any building thereon and furnishing and
equipping the same;
(2) acquiring ofrights-of--way far street or other purposes, making improvements
thereon, or constructing sewers or water pipelines;
(3) procuring of a water supply and constructing or acquiring of a water system and
improving the same if necessary.
7-7-4205. Term of general obligation bonds. (1) Bonds for any purpose may not be issued for a
longer term than 20 years.
(2) For purposes of this section, the term of a bond issue commences on July 1 of the
fiscal year in which the city first levies taxes to pay principal and interest on the bands.
7-7-4221. Election on question of incurring indebtedness -- exception. (1) Except as provided
in subsection (2) and 15-1-402, whenever the governing body of any municipality
• considers it necessary to issue bonds pledging the general credit of the municipality for
any purpose authorized by law, the question of issuing the bands shall first be submitted
to the registered electors of the city or town.
(2) It is not necessary to submit to the electors the question of issuing refunding bonds
to refund bands issued and outstanding ox the question of issuing revenue bonds not
pledging the general credit of the municipality under any laws of this state.
7-'1-4223. Procedure to call election an question of bonded indebtedness. An election on the
question of issuing bonds maybe called by the city ar town council ar c:ommissian on its
passage of the necessary resolution, as hereinafter provided, or after there has been
presented to the council ar commission a petition asking that such election be held and
question submitted.
7-7-4226. Resolution to submit question of issuing bonds to voters. (1) When the governing
body of any municipality considers it necessary to issue bands pledging the general credit
of the municipality pursuant to a statute of this state, the governing body shall pass and
adopt a resolution.
(2) The resolution must:
(a) recite the purpose or purposes for which it is proposed to issue the bands;
(b) fix the amount of bands to be issued for each purpose;
(c) determine the number of years through which the bands are to be paid, not
exceeding the limits fixed in 7-7-4205: and
(d) unless the bonds are revenue bonds not pledging the general credit of the
municipality, make provisions that aze necessary for submitting the question to the
registered electors of the city or town at the next general city or town election, at an
election that is conducted by mail ballot, as provided in Title 13, chapter 19, or at a
special election that is held in conjunction with a regular or primary election and that the
governing body may call for the purpose.
(3) Whenever the bond issuance is praposed by petition, the governing body shall,
before submitting the measure to the electors, pass a resolution containing the
information required in this section and setting forth the essential facts in regazd to the
filing and presentation of the petition.
7-7-4227. Notice of election. (1) Whether the election is held at the general city or town
election, at an election that is conducted by mail ballot, as provided in Title 13, chapter
19, ar at a special election that is held in conjunction with a regular or primary election,
sepazate notice of the election must be given.
(2) (a) The notice must state:
(i) the date when the election will be held;
(ii) the amount ofbonds proposed to be issued;
(iii) the purpose of the bonds;
(iv) the term of years through which the bonds will be paid; and
(v) other information regazding the election and the proposed bands that the board
may consider proper.
(b) If the bonds that are proposed to be issued are for two or more purposes, each
purpose and the amount for each purpose must be sepazately stated.
(3) The notice must be published as provided in 13-1-108 and maybe posted in each
voting precinct in the city or town at least 10 days prior to the date for holding the
election.
7-7-4235. Percentage of electors required to authorize issuing of bonds. Whenever the
question of issuing bonds for any purpose is submitted to the registered electors of a city
or town at a general election, at an election that is conducted by mail ballot, as provided
in Title 13, chapter 19, or at a special election that is held in conjunction with a regulaz or
primary election, the determination ofthe approval or rejection ofthe bond proposition is
made by a majority of the votes cast on the issue.
7-7-4236. Resolution to sell bonds. (1) If issuing ofbonds has been approved as provided in 7-
7-4235, the city or town council shall pass a resolution calling for the sale of the bonds.
(2) The resolution calling for the sale of the bands must state:
(a) the purpose for which the bands aze to be issued;
(b) the amount of the bands to be issued;
(c) the minimum purchase price of the bonds;
(d) the date that the bands will beaz;
(e) the period of time through which the bonds are payable;
(fl the optional redemption provisions, if any;
(g) that a bond maybe redeemed in full, at the option of the city or town, on any
interest payment date after expiration ofone-half of the term for which the bond was
issued; and
(h) a form of notice of the sale of the bonds.
• (3) The resolution must, except in a bond issue of citizen bonds, fix the denomination
of serial bonds in case it is found advantageous to issue bonds in that form. The council
may in its discretion provide that the bonds maybe issued and sold in two or more series
or installments.
(4) The city or town council may fix the minimum price for the bonds in an amount
not less than 97% of the face value if the city or town council determines that the sale is
in the best interests of the city or town.
7-7-4265. Tax levy far payment ofbonds. (1) The city or town council, at the time of making
the levy oftaxes for general city or town purposes, must levy a separate and special tax
upon all taxable property in the city or town for the payment of interest and principal for
each series or issue ofbonds outstanding. The tax levy for any one series or issue of
bonds must be entirely separate and distinct from the levy for any other issue or series of
bonds.
(2) Except as provided in subsection (3), the levy made for the purpose of paying
interest an and principal of each series or issue of bonds must be high enough to raise an
amount sufficient to pay all interest on and so much of the principal, if any, of the bonds
as will become due and payable during the then-current fiscal yeaz or within 90 days
thereafter, as such amount is shown by the treasurer's statement provided for by 7-7-
4264. If no part of the principal of such bonds will become due and payable within such
time, then such tax levy must be high enough to raise an amount sufficient to pay all
interest which will become due and payable during the current fiscal yeaz or within 90
days thereafter and to also place in the sinking fund for such issue or series ofbonds, for
the payment of the principal when the same becomes due, an amount not less than a sum
produced by dividing the whole amount for which the series or issue of bonds were
originally issued by the number of years for which such series or issue of bonds were
originally issued to run, as such amounts are shown by the treasurer's statement provided
for by 7-7-4264.
(3) The annual levies made for the purpose ofpaying offbonds that provide for no
periodic interest payments but rather aze sold at a discount from their face value, as
provided in 7-7-4211 through 7-7-4214, must be actuarially sufficient so that at the time
for redemption there is an amount in the sinking fund sufficient to redeem the bonds.
Time frames•
Once the council has determined to go forwazd with the process, the sequence of events and
related time tables would be:
Determination of GO debt limitation ~- 2.5% of market value ($207,518,243 for 2007) _
$5,187,956 (done)
Determination of costs to procure site and build structure - $4,000,000 (partially done)
Adopt resolution to submit the question to the voters -must be done 75 days before an election,
which would be August 21st in order to get on the ballot for the general election
November 4~'.
NOTE: If after August 213`, then can be done by mail ballot, anytime.
If supported by voters, then adopt resolution to sell bonds -- this takes 2-3 months.
It is recommended to obtain a financial advisor and bond counsel to issue and sell bonds.
Costs•
To issue a $4,000,000 GO bond, the annual debt service at 6% for 20 years would be
approximately $349,000.
This would mean an annual, voter approved levy of 56.36 mills based on the 2007-08 mill value
of $6,192. See attached table for breakdown of estimated costs for property owners.
•
•
D.A. Davidson & Co.
City of Laurel
Estimated MILL LEVY IMPACT ANALYSIS
Proposed Fire Station General Obligation Sonds
20 Year Term
May-08
mill Bevy Vomputat~on: Fire Station
Principal Amount of Bonds: 4 OS .00.000
Total Interest Over Life of Bonds (1): $2,980,000
Estimated Annual Bond Payment (1): $349,000
DIVIDED BY: FY 2007/08 Mill Value: 6 192
EQUALS: Estimated Number of Mills Required: 56.36
Estimated Tax Increase for Individual Residential Taxpayer:
2007 Phase-In Value of 2007 Taxable Market Value 2007 Taxable Value of Estimated
Residential Proper(y(21 of Residential Pro~ertvf2) e ' ntial Pro 2 ANNUALTax (3)
$75,000
....~.._.....~
....... $50,100
.... . $1,538 $86.69
~
~ 100,000
-_._._.-..~..~...~.~..~.._ ........... _
..:......$66,800^~.._ ..
...
.
.
H $2051. _M_..__. ~_._~ ..~...,.._,.,.._ .........._.........-,_.........~,.$1'15._~.,........~...u.._...._. _~.._.....w . ,,.,........, .~
ws~
$150,000
-__
__.~,._~...._.__......_ ..
.
.
~
$100,200
.._...-_.~,._.,,.,~.._.._ M. ~.,__.~..~...~_.._._..._I
.w.._.-___
$3,076
.~.._..~_
- __....,-,~..,........-.._.-.,_.....-_-..,...~w~. 7 ,.
.........~_................................,,.,.......
1 3,38
_
200,000
~~
$133,600 r., M
.~..__._.
$4,102 _.
r,~,...~_...~..~..__~.-~...~.~~.~.._...~..~____.~_.,~.....~...,..~..
$231.17
~
$250 000
..._.__.....~......_..,..__..
--~-~ $167,000
..
_._._~..~..~-_,.~.~.___.______ $5,127
~ _
.__._.._._.~......_,~.~._..._.__.._
$288.97
L .T
$300,000
----- ........ .
,._
$200 400
~ .,.~._____.~~...._.,.._.~.._
I
$6 152 _~..~~_....w.,..w~.~__~._.__..__......~_..,..,.~.
-~.-....... ~ .. _. __...... $346.76
(1) Estimates based on bonds being repaid at an average rate of approximately 6.00% (20 years).
(2) Based upon Class 4 residential property. The "Phase-In Valuation" and the "Taxable Market Value" for taz purposes will be different than
the valuation of most residential teal property for resale purposes. To better calculate the estimated tax impact of the bond issue, property
owners should look up their exact taxable value as shown on their personal tax statement from the County Treasurer and use
the formula shown below.
(3) Tax impacts ate based on recently enacted property tax legislation for the current tax year. Tax impacts will vary every year depending
on such factors as City mill value, method of calculating taxable valuation, and actual debt service.
* All property owners (including farming and ranching operations, commercial businesses, home owners etc...)
should use the following formula to calculate the estimated tax impact of the Band issue.
Taxable Valae (From Personal Taz Statement) X .05636 =Estimated Annual Tax Impact of the Bonds
.7
City of Laurel .
Debt Issuance Fact Sheet
2/26/08
1) General Obligation Bonds.
-Authorized by vote of City residents
-Paid from general, unlimited property tax levy
-Cities limited to GO debt of 2.5% of assessed taxable value ($4,887,000 for
Laurel)
-Current cost estimate of 6.S mills per $500,000 of GO debt issued ($20 annually
for $150,000 home, 20 years)
-Bonds sold by competitive sale
-Parties involved: financial advisor, bond counsel, paying agent, underwriter,
independent rating agency, bond insurers
-credit factors: tax base size and diversity, tax collections record, financial
management, outstanding debt, other capital needs, local economic factors
2) Special Improvement District Bonds.
-Approved by "negative vote" of property owners (protests)
-Paid from special assessments, revolving fund
-Revolving fund can be replenished by limited tax levy (entire city)
-Sizing limited by credit evaluation
-Generally less secure than GO
-Smaller districts are good candidates for Intercap (costs)
-Bonds sold by competitive sale (except Intercap)
- Parties involved: same as GO
-Credit factors: number of parcels, number of owners, development, size of
revolving fund, tax and assessment collection history
-Unlikely to receive a bond rating
3) Tax Increment Revenue Bonds.
-More complex to establish district and conduct sale of bonds versus GO or SID
-Approved by action of council following notice and public hearing
-Credit based solely on security of district cash flows (no general tax backing or
revolving fund)
-If there are one or a few developers or major taxpayers, they are critical to the
credit evaluation and mazketability of the bonds
-Important to get an underwriter involved early
-Parties involved: same as GO and SID plus negotiated underwriter, trustee and
developer
-Credit factors: debt service coverage, debt service reserve, amount and quality of
development, financial soundness of property owners, strength of development
agreement, additional security (letter of credit), city and district economic strength
and diversity, development potential
•
~,~.~~~.~~a ~
~ `~~ ~~v~d~-
4) Current Credit Mazket Status.
-Bond market is currently unstable (sub-prime mortgages)
-Impact of instability is not great on most bonds that would be issued by Laurel
-Lower credit quality bonds will be more difficult to sell and most likely will be
sold at higher interest rate spreads than has been the case historically
- Interest rates overall are still low
.7
L~