Morris sells $2.86 million in bonds for projects
MORRIS – The Morris City Council voted Tuesday to sell $2.86 million in general obligation bonds to help pay for construction and demolition projects.
Brian Rielly, a representative with the city's bond financial consultations, Ehlers and Associates, told the council that there were five bidders for a request to sell $2.95 million in bonds. The low bidder was Piper Jaffray of Minneapolis, with a bid of 1.8 percent over the length of the project.
The bond includes money for a summer road improvement project on Morris' west side, $800,000 for the demolition of the old elementary school building that will be repaid with money collected from Tax Increment Financing (TIF) districts, and refinancing an existing bond.
Ehlers combined the three projects into one $2.95 million bond issue to make it more attractive to purchasers, said Rielly.
The city received a premium bid on the bonds from Piper Jaffray, which means that the purchaser paid more than the face amount of the bonds.
As a result, the city will pay a slightly higher interest rate, but will also get some cash up front that allows the bond issue to be reduced to $2.86 million to save money on debt service payments, explained Rielly.
Moody's, a bond credit rating firm, assigned an A1 rating to the bond issue. This rating is based on local economy, demographics and tax statistics, debt profile and financial management practice, said Rielly.
As a result of the low interest rate on the bond issue, the interest rate on the assessments for residents affected by the west side road project could be as low as 2.8 percent, City Manager Blaine Hill said. In the past, the interest rate on assessments have been as high as 5.25 percent.
“When you look at it, it's kind of the perfect storm for what we're doing – great bids, great bond – it's the perfect time to be doing this work,” said Hill.
• City Manager Blaine Hill told the council than the engineer's estimate indicated it would cost between $317,000 and $457,000 to bring city water and sewer lines out to the Morris Coop's new Agronomy Center on Highway 9.
Morris Coop Manager Brian Kruize approached the council last month to request city services out to the new facility. After the meeting, Hill met with Jeff Kuhn of WSN Engineering to look at the issue more closely. The cost estimates depend on which direction the lines are run.
Hill said he planned to sit down with Kruize and Kuhn to discuss the request, then report back to the council.
• The council approved an ordinance regarding criminal history background checks for potential employees and those interested in obtaining licenses. The city already does these checks, but the ordinance is needed to allow the Morris Police Department to use a state system for the background checks.
• The council approved the budget for the 2013 Prairie Pioneer Days celebration. The budget submitted by the Morris Area Chamber of Commerce includes a net loss of about $3,900 which will be paid for with money collected through the city's lodging tax, a three percent tax charged to every person who stays at a hotel in Morris. Money from the lodging tax is used to support tourism activities like PPD.
Any expenses that exceed the amount collected by donations, vendor registrations and button sales will be covered with money from the lodging tax.
• The council authorized spending $575 from the tourism fund to pay for tote bags that will be used as part of the city and chamber's tourism effort.
• The council authorized $58,810 to purchase a new bus for Morris Transit. The city will be responsible for 20 percent of the cost; the remaining 80 percent is covered through a state/federal grant.
“It think [transit] is an awesome deal for the city … so we do need to keep and maintain our buses system,” said City Council Member Jeff Miller.
• The city of Morris was named a 2012 Tree City USA by the Arbor Day Foundation in honor of its commitment to effective urban forest management. This is the ninth year that Morris has earned this honor.
On Tuesday, Mayor Sheldon Giese signed a proclamation declaring May as “Arbor Month” in Morris which urged “all citizens to help care for our trees and try to plant at least one tree in 2013 to beautiful our city, improve our environment and promote the well-being of present and future generations.”