Medina gets historic low interest rates

Medina’s financial advisor, Shelly Eldridge, of Ehler’s and Associates, said she felt like doing a little dance Tuesday, Oct. 2, as she waited to report to the Medina City Council on results of the city’s bond sales.

When she came before the council, she gave the reason for her excitement. The low bid for Medina’s sale of $6.1 million in General Obligation Capital Improvement Bonds was at an interest rate of 2.13 percent — definitely less than her estimate of 2.6 percent.

And she had even more good news. The low bid for a second bond sale came in at .987 percent. This bid was for the sale of $2,845,000 in General Obligation Refunding Bonds.

She called these interest rates “very good” and provided graphs showing that they were amongst historic lows.

The $6.1 million bond sale will be used to remodel the Clam Corps Building, at 600 Clydesdale Trail, which Medina is in the process of purchasing to house the Public Works and Police Departments. These are 20-year bonds.

The sale of refunding bonds is Medina’s way of “refinancing” at a lower interest rate the debt from constructing the city water treatment plant, storm water improvements in uptown Hamel and Hamel Road improvements.

Eldridge said the two bond sales aroused a lot of interest and attracted a number of bidders.

“You guys have a strong bond rating,” she commented. Also, the refunding bonds are for a nine-year term, which  makes them a short-term investment. Both these factors mean lower risks for investors.

Also, the lower interest rates mean that Medina property owners will have lower debt service costs via property taxes, and the cost of the new home for the Public Works and Police Departments will be lower in the long run. .

The City Council approved both bond sales. At the same time, it voted to recharacterize $1.4 million in unspent proceeds of Series 2007A Water Bonds as General Obligation Capital Improvement Bonds. This action makes it possible for Medina to use the $1.4 million for the Clams Corp remodeling project. The bond proceeds originally were intended for construction of a new water tower.

At the Oct. 2 meeting, the City Council also took up other business.

 

ENCLAVE AT BROCKTON LANE

The council also approved final documents relating to construction of phase one of the Enclave at Brockton residential housing development. One of them is the final plat and the other is the development agreement with U.S. Homes Corporation. The final plat shows 24 single-family lots, one of which will be used for a swimming pool and pool house for the development. Developer Lennar owns all of these lots.

In related action, the City Council approved the final plat for the Enclave at Brockton Second Addition. People other than Lennar own many of the lots, and the owners have agreements with the developer.

The council also approved an ordinance establishing a Brockton storm sewer improvement tax district. This tax district is a back-up plan that would go into effect if the Brockton Enclave homeowners association fails to maintain storm sewers. The tax money would finance Medina’s costs for doing the work.

The Enclave at Brockton will be Lennar’s second residential housing development in the area between Hunter Drive and Brockton Lane and north of Medina Road. Construction of homes in the Hunter Drive development is well underway and many homes already sold, said Joe Jablonski of Lennar.

He expected his company to complete roadwork for the Enclave at Brockton this fall and to fully build out both  Enclave developments by the end of 2015. Lennar is monitoring the town home market and using that information to decide when town homes will join the single family homes in the Enclave on Hunter Drive.

Jablonski said he was excited about Lennar’s building of multi-generational homes in the Hunter Enclave. This product “reaches out to a whole different group of people.”

Families with older relatives, multi-cultural families and families with special needs members might be interested in this type of housing.

 

OTHER

The City Council also:

RECOGNIZED people who volunteered for Medina Celebration Day. Mayor Tom Crosby recognized Linda Lane, planning and public works assistant, for her work in coordinating Celebration Day.

ACCEPTED donations for Medina Celebration Day.

APPROVED the assessment role for the Hunter Drive North road improvement project. Total assessments will amount to $350,208.70.

CERTIFIED delinquent charges for city services to the Hennepin County Auditor for collection in 2013 property taxes.

 

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