Corcoran approves $4.4 million bonds for public works, CIP
City ‘very pleased’ with Moody’s A2 rating
Corcoran city staff reported to the city council that the city received an A2 rating, its first ever, ahead of two bond sales.
The council also was updated regarding the Loretto and Hamel Fire Department Collaborative Services Study.
City administrator Dan Donahue updated Mayor Ken Guenthner and the council about Moody’s Investor Service’s rating related to two bond sales.
The first bond sale of $4 million is for the new public works facility under construction at County Rds. 10 and 19. The second is for equipment certificates of indebtedness for the city’s Capital Improvement Plan (CIP).
“We have received a bond rating of A2,” Donahue said in his memo. “Given that this is the first time Corcoran has ever been rated, I think this is a terrific rating and am very pleased.”
In giving its rating, Moody’s noted that Corcoran’s strengths include: tax base benefits from location in Twin Cities metro area and high wealth indices; satisfactory financial operations supported by significant alternate liquidity; and minimal debt burden.
Noted challenges include: significant declines in valuation during the past few years; narrower general fund balances compared to other Minnesota cities; and infrastructure needs for future development.
Moody’s reported that the city’s financial operations have been stable during the past few years.
“The city recently adopted a five-year financial plan that outlines a goal to increase the general fund reserves to the newly adopted fund balance policy of 35 percent of expenditures by 2016,” Moody’s said.
Moody’s also noted that the city would use about $1.3 million in Tax Increment Financing (TIF) reserves towards construction of the sewer connection project. For the upcoming fiscal year, the city has budgeted $300,000 in additional TIF reserves for the sewer connection project and is planning for a balanced general fund budget.
The council unanimously approved both bond sales.
In other news, the council was updated regarding the Loretto and Hamel Fire Department Collaborative Services Study.
Loretto chief Jeff Leuer was present with the update. The study was released a year ago and made many recommendations on options and ways for the two fire departments to be more collaborative. It was noted that nothing substantive has been accomplished in the study.
Administrator Donahue said he, the Medina administrator, fire chiefs and police chiefs agreed that the best way to move this process along is to have a facilitator on board that could “drive” the process.
“I have been thinking about this need and have come up with the idea of utilizing the skills of a retired city administrator who is very qualified to assist and is interested,” Donahue wrote in his memo.
If this happened, the facilitator could work six months (three to five hours per month) at a cost of $2,000. Donahue said Medina is interested for sharing half the cost.
“Corcoran can’t move ahead with our plans to provide better fire services for the future until this Loretto/Hamel collaboration is settled,” Donahue said. “If it can’t, then we need to move ahead with putting our requests for proposals (RFP) for fire services out on the street.”
No action was taken as this was for discussion purposes only.
In other action, the council:
HEARD a report from the city engineer about a Trail Haven Road improvement project. Trail Haven only (no Foxline and Treeline) would cost $695,000, with potential per lot assessment of $12,750.