04-14-1986 Council Packet - Laserfiche WebLink

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City Facilities Assessments March 20, 1986 Page 4 of 5 1. Bonding- The general means of developing alternative facilities is through the sale of general obligation bonds. These would be no different then the special assessment bonds that have been sold in the past. They would generally however have a lesser interest rate together with the fact that they would require that it be submitted to the electorate in order for such bonds to be issued. Participation by other organizations such as other communities, Post Office, Library etc, in a joint. development may raise some questions under current. the Grahm-Rudman Bill as to the tax exempt status of the bolds. 2. Lease -Purchase- In recent years legislation has been passed to allow for a community to acquire capital equipment or buildings through the use of a lease -purchase arrangement with a private finance company. This is structured so as not to require a vote of the public. The City would however need to keep current with lease payments or it would lose the facility. At the end of the term of the lease the City can generally purchased the property for a dollar. Financing in this manner would be favorable in part due to the depreciation credits available. Further investigation of this option is needed ii the Council would be interested. (It maybe appropriate that the City buy the land on which the building is sited in order to firm up their interest in the lease.) 3. Sale of Property- The City does have a number of properties scattered through out. the City. It maybe appropriate to sell these in order to generate additional cash which could be used to finance a facility. Even without a new facility it would be pruden' to sell this property as the City has no interest in maintaining them. (Principal among these properties are 25 acres acquired for McCauley Road together with property in Crystal Bay the Cit; would care if it went to a different facility.) 4. Existing Cash Balance- The City could look at utilizing its rather substantial cash balance as a means to fund a facility on the front end and utilize tax anticapation certificates for Its cash flow until such as its restored through taxation. A variation maybe "Investing" the funds construction of a new facilities. RECOMMENDATION -- Based on the issues above it is staff's recommendation that Orono relocate all its facilities to one site separate from Crystal Bay with one maybe two buildings. This would be located in the community on any number of possible locations shown on attachment E. In addition to the City relocating its facilities the City could explore with abutting communities such as Spring Park anJ Minnetonka Beach and see if they have any interest in sharing facilities. This would still be convenient to their communities without the City of Orono ahsorhing them. Additionally it may be prudent to discuss with the post office the development of a consolidated postal facility. Other cooperative options may look at providing maintenance space for agencies such as Hennipen County Parks for servicing the Norenberg property and Rig Island should they ever attain it and LMCD for maintenance should I,MCD become involved in operations with facilities on the lake.