09-28-1988 - Agenda Packet City Council - regular meeting

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92� ? To: Mark E. Bernhardson, City Administrator From; Tom Kuehn, Finance Director TY Date: September 23, 1988 Subject: Auditor's Report on Special Assessment Cash Flow Forecast ATTACHMENT - Special Assessment Cash Flow Forecast Report DISCUSSION - In August we contracted with the City's auditors, Pannell Kerr Forster, to perform a Cash Flow Projection and Analysis of the various special assessment levies which support the payment of the Improvement Bond Funds. The purpose of the analysis was to determine if there was sufficient future assessment revenues to maid the bond and interest pay- ments as they come due and to determine if it is necessary to levy and collect the supplemental taxes previously passed by Council or to pass a new tax levy to aid in the payment of future bonds and interest. After reviewing the various assumptions projected, w have determined that thc, 1966-76 Improvement Bond Fund and the 1980 Improvement Bond Fund will not require tax levies so the levies will he cancelled each year. In fact, those two funds indicate sure lusses at the f i ra 1 payment of a l l bonds as shown on Pages 1 and 2. The projections are extended through 25 years due to the computer program, however each fund will be closed after the completion of the spacial assessment levies and the final maturities of bonds issued. The 1982 Improvement Bond Fund on Page 3 indicates the need for support other than special assessments in the last two years, 1998 and 1999. However with the fluctuations possible in the investments earnings rates and other variables over the next ten years, a tax levy need not be established at this time and is not recommended. The 1985 Improvement Bond Fund has two forecasts on Pages 4 and 5. The forecast on Page 4 reflects the situation if no tax levy is approved and shows a negative cash balance beginning in 1991. The forecast on Page 5 includes +-he effects of tax levies under the "Other Receipts" column. At that forecast, the fund will be solvent. It should be noted that the situtation will continue to be monitored and the levy adjusted as needed. The tax levy resolution has been included in this agenda as a separate item for Council actirn. To: Mayor Grabek & Orono Council Menibe> . Fres: Mark E. BPrnhardson, City Administrator Forwarded recommending acceptance. PROPOSED MOTION: Moved by , secondeu by , to accept th^ Spe( i Assessment Cash Flow Forecast Report by Pannell Kerr Forstr prosenL�J. Ay,_ , nays