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Home My WebLink AboutCC September 21, 1999 " CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW, . ANDOVER, MINNESOTA 55304 . (612) 755-5100 Regular City Council Meeting - Tuesday, September 2 I, 1999 agenda '- ./ Call to Order - 7:00 PM Resident Forum Agenda Approval Consent Agenda Approval of Minutes Bookmark Name minutes Discussion Items I. PresentationlSt. Francis School District 15 Referendum 2. Public Hearing/99-28/ PavingiNavajo St. NW, I 73rd Ave. NW & 175th Ave. NW 3. Award Sale - 1999C G.O. Special Assessment Bond 4. Approve Ordinance No. 247, Right-Of-Way Management Ordinance 5. Approve Resolution Setting Fees/Ordinance No. 247 . 6. Consider Participation in Metropolitan Livable Communities Act referendum ph9928 bond ord247 feesord247 act Staff. Committees. Commissions 7. Discuss Use of Trail Funds on Previously Approved Projects 8. Approve Revised 1999 Park Capital Improvement Budget distrail apprpark ~J Executive Session 9. Grievance of Disciplinary Action: Street Supervisor grievance Non-Discussion/Consent Items 10. Approve Tobacco License tobacco 11. Approve Increase/Non-Intoxicating Off-Sale Liquor License Fee offsale 12. Award Bid/99-32/I999 Reclaiming & Overlay bid9932 13. Approve Quotes Public Works and Sunshine Park Signs signs 14. Request Bid/New Pumper/I 999 Equipment Certificate pumper 15. Request Two (2) Utility VehiclesIFire Department utility 16. Request Update ComputerslFire Station #1 computers 17: Request AuthorizationlFirefighter Training ContractlAnoka Technical College firefighter 18. Request Purchase Emergency Vehicle Pre-empt. Emitter Equipment emitter 19. Approve Lube System AdditionlPublic Works/1999 Equipment Certificate lubesystem 20. Approve Purchase of Truck Body, Hoist, Plow & HydraulicslParks Departmentll999 Equip. Cert.truckbody 21. Approve Purchase of Easement MachineIPublic Works easement 22. Update of Kelsey Round Lake ParkJ96-I/Ribbon Cutting Ceremony updt961 23. Approve HireIPublic Works Maintenance Supervisor supervisor 24. Approve Use of Trail Fund trail Mayor/Council Input Payment of Claims Adjournment , '-./ , "\ CITY of ANDOVER , '-../ 1685 CROSSTOWN BOULEVARD NW. . ANDOVER, MINNESOTA 55304 . (612) 755-5100 Regular City Council Meeting - Tuesday, September 21, 1999 agenda CalI to Order - 7:00 PM Resident Forum Agenda Approval Consent Agenda Approval of Minutes Bookmark Name minutes Discussion Items I. Presentation/St. Francis School District 15 Referendum 2. Public Hearing/99-28/ PavinglNavajo St. NW, I 73rd Ave. NW & I 75th Ave. NW 3. Award Sale - 1999C G.O. Special Assessment Bond 4. Approve Ordinance No. 247, Right-Of-Way Management Ordinance 5. Approve Resolution Setting Fees/Ordinance No. 247 6. Consider Participation in Metropolitan Livable Communities Act referendum ph9928 bond ord247 feesord247 act Staff, Committees, Commissions 7. Discuss Use of Trail Funds on Previously Approved Projects 8. Approve Revised 1999 Park Capital Improvement Budget distrail apprpark . ~\ \..~ Executive Session 9. Grievance of DisciplinaryAction: Street Supervisor grievance Non-Discussion/Consent Items 10. Approve Tobacco License tobacco II. Approve Increase/Non-Intoxicating Off-Sale Liquor License Fee offsale 12. Award Bid/99-32/1999 Reclaiming & Overlay. bid9932 13. Approve Quotes Public Works and Sunshine Park Signs signs 14. Request Bid/New Pumper/1999 Equipment Certificate pumper IS. Request Two (2) Utility VehicleslFire Department utility 16( Request Update ComputerslFire Station #1 computers 17. Request AuthorizationlFirefighter Training Contract! Anoka Technical Co lIege firefighter 18. Request Purchase Emergency Vehicle Pre-empt. Emitter Equipment emitter 19. Approve Lube System AdditionlPublic Works/1999 Equipment Certificate lubesystem 20. Approve Purchase of Truck Body, Hoist, Plow & HydraulicslParks Department!1999 Equip. Cert.truckbody 21. Approve Purchase of Easement MachineIPublic Works easement 22. Update of Kelsey Round Lake Park/96-I/Ribbon Cutting Ceremony updt961 23. Approve HireIPublic Works Maintenance Supervisor supervisor 24. Approve Use of Trail Fund trail Mayor/Council Input Payment of Claims Adjournment / \ '0 CITY OF ANDOVER REQUEST FOR COUNCIL ACTION / DATE: September 21, 1999 AGENDA SECTION ORIGINATING DEPARTMENT APPROVAL OF MINUTES City Clerk ~.U' ITEM NO. Approval of Minutes The City CounciI is requested to approve the following minutes: September 1, 1999 SpeciaI Meeting (Knight, Grttel absent) September 7, 1999 ReguIar Meeting \ I , / CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: SePtember 21. 1999 AGENDA SECTION ORIGINATING DEPARTMENT Discussion Item Administration Richard Fursman ITEM NO. l. Presentation/St. Francis School District 1 5 Referendum BACKGROUND: A representative from St. Francis School District 15 will be present to provide the Council and the citizens of Andover an update on the proposed referendum. / CITY OF ANDOVER REQUEST FOR COUNCIL ACTION / DATE: September 21. 1999 AGENDA SECTION Discussion Item ORIGINA TING DEPARTMENT ITEM NO. Public Hearing/99-28/Paving/Navajo Street NW, ~1.73rd Avenue NW & 175th Avenue NW , Scott Ericksonq,~ Engineering The City Council is requested to hold a public hearing at 7:00 PM for Project 99-28, for street paving in the area of Navajo Street NW, 173rd Avenue NW & 175th Avenue NW. Attached are the following: -Resolution ordering improvement -Letter to property owners -Public Hearing Notice -List of property owners -Copy of original petitions j Note: The feasibility report was in the August 17, 1999 packet. Please bring this to the meeting. The following items will need to be addressed: . 1. The project limits (3 options were identified). 2. The Council had previously discussed assessing the westerly 30 feet of paving along 175th Avenue NW. It was indicated that this small amount of pavement would not be assessed. If the City Council concurs, the pending assessment for this property would be removed. 3. If it is decided to pave 175th Avenue NW, I would recommend the City mill and repave the exiting paved area out to County Road 7. The funding would be from the overlay fund. , I / CITY OF ANDOVER COUNTY OF ANOKA STATE OF MINNESOTA RES. NO. MOTION by Councilmember to adopt the following: A RESOLUTION ORDERING THE IMPROVEMENT OF PROJECT NO. 99-28. NAVAJO STREET NW. 173RD AVENUE NW & 175TH AVENUE NW. WHEREAS, Resolution No. 186-99 of the City Council adopted on the 17th day of AUQust, 19 99 , fixed a date for a public hearing; and WHEREAS, pursuant to the required published and mailed notice such hearing was held on the 21st day of September, 19~; and WHEREAS, all persons desiring to be heard were given such opportunity for same; and I NOW, THEREFORE, BE IT RESOLVED by the CityCouncil of the City of Andover to hereby order improvement Project No. 99-28 MOTION seconded by Councilmember . . and adopted by the City Council at a reqular meeting this 21st day of September ,19~, with Councilmembers voting in favor of the resolution, and Councilmembers voting against, whereupon said resolution was declared passed. CITY OF ANDOVER ATTEST: J,E. McKelvey - Mayor Victoria Volk - City Clerk . / -) -) -'" ' / CITY of ANDOVER 1685 CROSSTOWN BOULEVARD N.W. . ANDOVER. MINNESOTA 55304 . (612) 755-5100 CITY OF ANDOVER COUNTY OF ANOKA STATE OF MINNESOTA NOTICE OF HEARING ON IMPROVEMENT PROJECT NO.~~ NAVAJO STREET NW, 175TH AVENUE NW & 173RD AVENUE NW NOTICE IS HEREBY GIVEN that the City of Andover, Anoka County, Minnesota will meet at the Andover City Hall, 1685 Crosstown Boulevard NW in the City of Andover, on Tuesday, September 21, 1999 At 7:00 PM to consider the making of the following improvements: Street Construction The property to be assessed, pursuant to Minnesota Statutes Section 429, for the improvement is within the following described area: . ) Navajo Street NW, 175th Avenue NW & 173rd Avenue NW The estimated project cost of such improvement is: $59,320.00 (Option #1, Navajo Street NW & 175th Avenue NW) .$57,830.00 (Option #2, 173rd AvenueNW) . .' $90,630.00 (Option #3, Navajo Street NW, 175thAvenue NW & 173rd Avenue NW) '. . ... . 'Suchpersonsas desire to beheardwith reference tothe proposed improvement will be heard' ': ... .a(this meeting.. . . . j CITY OF ANDOVER " ~Jj~" <_VictoriaY6Ik- City Clerk' . Publication Dates: 9-3-99 9-10-99 / 9-17-99 f'c (( CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW, . ANDOVER. MINNESOTA 55304 . (612) 755-5100 . August 24, 1998 . - .., -. ~ Re: Proposed Improvement: Street Construction/Navajo Street NW, 175th Avenue 'NW & 173rd Avenue NW/Project 99-28 Dear Resident: A feasibility report has 'been prepared to determine the estimated cost to p~ve the streets in the above .'. mentioned area. . " ,.'11 " ,; .1 " " ~ Ii fi 11 i~ H Discussion: The City of Andover has received a petition from your neighborhood to consider reconstructing the streets within your area. The construction would consist of paving a 24 foot wide asphalt surface 2.5" thick on existing gravel base. The streets in the area presently exist as 22-26 foot wide rural section. roadways consisting of fine sand and gravel. . Estimated Cost: ' The estimated assessment to each lot is $4,395.00 (Option #1, Navajo Street NW/175th Avenue NW), $8,260,00 (Option #2, 173rd Avenue NW), $4,420.00 (Option #3, Navajo Street NW, 175th Avenue NW & 173rd Avenue NW). This cost could be assessed over a 5 year period at approximately 6% interest or the assessment may be paid in full with no interest within 30 days of the assessment hearing. -fossessment Period/Cost: The annual assessment payment over 5 years at 6% is approximately $930 per year. (Varies depending upon which option is chosen), If you have any questions, feel free to contact me or my assistant Todd Haas at 755-5100. Sincerely, (2l&?y~ Scott Erickson, P.E. City Engineer , SE:rja Encl. cc: Mayor & City Council ) CITY of ANDOVER 1685 CROSSTOWN BOULEVARD N,W, . ANDOVER, MINNESOTA 55304 · (612) 755-5100 August 24, 1998 Willard & Doreen Maki 4639 -175th Avenue NW Andover, MN 55304 Re: Proposed Improvement: Street Construction/Navajo Street NW, 175th Avenue NW & 173rd Avenue NW/Project 99-28 Dear Resident: A feasibility report has been prepared to determine the estimated cost to pave the streets in the above mentioned area. Discussion: , , The City of Andover has received a petition from your neighborhood to consider reconstructing the _ streets within your area, The construction would consist of paving a 24 foot wide asphalt surface 2,5" ---thick on existing gravel base, 'The streets in the area presently exist as-22-26 foot wide rural section . roadways consisting of fine sand and gravel. :. Estimated Cost: '-.Theestimated assessment to each lot is $2,200.00 (Option #1; Navajo Street NW/175th Avenue NW), .' $2,230,00 {Option #3, Navajo StreetNW,175th Avenue NW & 173rd AvenueNW). This cost could be assessed over a 5 year period at approximately 6% interest or the assessment may be paid in full with . ..' fio interest within 30 days -of t\1e~ssessment hearing.. '. . -- . Assessment Period/Cost: '. , , . The annual assessment payment over 5 years at 6% is approximately $440 per year. '. . . If you have any questions, feel free to contactme or my assistant Todd Haas at 755-5100.' . f:?~;;y~. Scott Erickson, P.E. City Engineer . , SE:rja Enc!. . cc: Mayor & City Council 06 32 ':4 34 0007 06 32 24 34 0002 06 32 24 34 0006 R'ICHARD & SM WANDERSEE ROBERT & CONSTANCE LAVONNA NEWSTROM 17315 NAVAJO ST. NW PROTIVINSKY 17365 NAVAJO ST, NW ANDOVER, MN 55304 17325 NAVAJO ST. NW ANDOVER, MN 55304 ANDOVER, MN 55304 06 .:12 24 34 0005 06 32 24 34 0004 063224340001 DALE & VERNA RENSLOW KURT & RITA DRISCOLL PHILIP & HELEN SPAULDING 4519 - 175TH AVE. NW 4539 - 175TH AVE. NW 4605 - 175TH AVE. NW ANDOVER, MN 55304 ANDOVER, MN 55304 ANDOVER, MN 55304 06322431 0002 06 32 24 32 0002 06 32 24 32 0008 C GONZALEZ & ML GRIFFIN STEVEN & ANNE GRESHAUN WILLARD & DOREEN MAKI 4615 - 175TH AVE. NW 4629 - 175TH AVE. NW 4639 - 175TH AVE. NW ANDOVER, MN 55304 ANDOVER, MN 55304 ANDOVER, MN 55304 063224330018 063224330017 07 32 24 22 0003 GREGORY ANDERSON MICHAEL & BEVERLY KNIGHT FRANK & JACQUELINE PADULA 4622 - 175TH AVE, NW 4660 -175TH AVE, NW 4630 -173RD AVE, NW ANDOVER, MN 55304 ANDOVER, MN 55304 ANDOVER, MN 55304 07 32 24 22 0004 07 32 24 22 0005 07 32 24 22 0011 FRANK & JACQUELINE PADULA FRANK & JACQUELINE PADULA FRANK & JACQUELINE PADULA 4630 -173RD AVE. NW 4630 -173RD AVE. NW 4630 - 173RD AVE. NW ANDOVER, MN 55304 ANDOVER, MN 55304 ANDOVER, MN 55304 O. , 24 21 0016 063224330016 06 32 24 34 0003 F,.. .,..JK & JACQUELINE PADULA BRUCE & MARJORIE PERRY WILLIAM & GERRI GAUSMAN 4550 - 173RD AVE. NW 17337 ROANOKE ST. NW 4549 - 175TH AVE. NW ANDOVER, MN 55304 ANDOVER, MN 55304 ANDOVER, MN 55304 99-28,DOC qqr& August 2,1999 \ l Andover City Council: The attached Petition was served to the Residents on the Dirt Road portion of 175th Ave, N.W. and Dirt Road portion of Navajo St. N.W. Gregory Anderson at 4660 175th Ave. N.W. did not sign the Petition. On July 29,1999, the date of first approach, Mr. Anderson stated he had an agreement with Michael Knight, that if he did not sign for any Blacktopping Michael Knight would not develop his property. Petitioner called Michael Knight on the evening of August 2,1999 asking if any such agreement was in effect, whereas, Mr. Knight stated there was no agreement. On second approach to Mr. & Mrs. Gregory Anderson they refused to sign and stated that if it went through they would then accept it. Mr. & Mrs. Steven Gresham at 4629 175th Ave. N.W. were not available for signature as they were out of town on vacation. All other Residents on Dirt Road portion of 175th Ave, N. W. and on Dirt Road portion of Navajo signed the Petition. LaVonna Newstrom ,Robert Protivinsky ,Connie Protivinsky " , ) J J;~n-:-;.-,--r...,..,. " , j CITY of ANDOVER Date, gt. c?3, ItNC) No, V' / Gentlemen: owners of real in the following described and that the cost of said improvement be assessed against the benefiting property, as authorized by Chapter 429, La~...s of Minnesota, '\ / SIGNATURE O? OWNER ADDRESS ~~tq.n:roNl YES NO / >< ;~z J(' . .~ 9''/- z f- '\ J August 2,1999 Andover City Council: The attached Petition was served to the Resident Land Owners Bordering Dirt Roads 173rd Ave. N. W. and Navajo St. N. W. Mr.Frank Padula,4550 173rd Ave.N.W., gave no definite reason for declining support of the Petition to Blacktop 173rd Ave. N.W. His quote was, I just don't want to do it now. , '\ , / Bruce and Marge Perry, 17387 Roanoke St. N. W., after some discussion, decided not to sign the Petition to Blacktop 173rd Ave. N.W, Their property has an entry point onto 173rd Ave. N.W. They stated they would be in favor of an overall project to include 173rd Ave. N.W., Dirt Road Navajo St. N.W. and Dirt Road 175th Ave. N.W. Michael Knight declined to sign previous petitions to blacktop roads in area. LaVonna Newstrom,Robert Protivinsky,Connie Protivinsky / CITY of ANDOVER " Date'~ ,.{3" I Cf tiC; No. Gentlemen: undersigned, owners of real property in the fOllowing described - ',/ - do hereby petition tha~ S~~f m"f};a he1lrove~y, ~l Construction of City ;1;ZA~ _~" .d1J "{fA.) ",<If( a1<7Zi~_ . (lA-<1M ~;(j; Rd ; ,. .4.-s; - and that the cost of said improvement be assessed against the benefiting property, as authorized by Chapter 429, Laws of Minnesota, ~~KlnroN[ \ 73 IS' f\h\it\'c ~ N uJ J K./ YES !!Q " / This petition Address: . ',- 99 - 2J7 August 2,1999 Andover City Council: Attached is the Survey taken on July 31,1999 of all Residents on Blacktopped Navajo Street N.W. regarding their acceptability of Blacktopped Streets known as 173rd Ave. N.W. , Navajo Street N.W.(Dirt Road) and 175th Ave. N.W. (Dirt Road). Robert Protivinsky and Connie Protivinsky , Survey. Gentlemen: We, the undersigned, owners of feat pr arera: ' in the following described ~#7 rb~~~~g YJIfl f ~ Signature of Owner Address Yes No /7 Ilf <; IV o."")C S-/ }J { (13 ~ use-cL ,J! i..15-etf2 rd I 73J...O / 3_J 173 v1 ... July 27,1999 0 Ori9\~ lW;~L Andover City Councit: We have surveyed I esidents un Navajo Streetinctudtngihe addresses of 17315) 17325)17365and1heproperty adjacent to the Westknowoas Michael B. and Beverly Knights "Knightridge T-ree -Farm". . Michael B. Knight was petitionedoo July 24) 1999-regardtr!g _ signing of this petition to Blacktop said above Street. -on this date Michael B. Knightstatedtle -didl1ot want to be involved because he did not have to pay for it and-he was deferred for a 15 year-period or tmtihjevelopingtakes .- -: place. We were informed that Michaef.Knight needed to signthe petition. On July 27) 1999weagain petitioned Michaei Knight regarding signing -of said-petition and he :) said it was not necessary for him tonstgn 100 petition~ A petition is being circulated 10 the Residents of 17-5th Ave, regarding an extension for-an overaiiproject. A Survey is being taken of All Residents on Blackto:Qped Navajo Street regarding their acceptability to an -egress onto Blacktopped Street known as 173rd Ave. to 7th Ave/Roanoke. A petition will also be served to the property owners with land bordering 173rd Ave for an overall project. Petitions for 175th Ave. t 173rd Ave. and Survey resuits wifi be sent to the Council as soon as -possibie. LaVonna Newstrom) Connie ProtivinskYtRobert Protivtnsky .~ , ) , / CITY of ANDOVER Gentlemen: Date~oi'J, /qq9 No. We, the undersigned, owners of real property in the following described area: do hereby petition t] ~",J!iTdi:ea ~e rrov'1i,hY T1-fJ .~:;;:t~iJ ~/t;:;}i;;yt;fhT'L wd:# O/Wk~,rM0 and that the cost of said improvement be assessed against the benefiting property, as authorized by Chapter 429, Laws of Minnesota. OF OWNER ADDRESS ~~Kln~ YES !iQ / / CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE Seotember 21. 1999 AGENDA SECTION ORIGINATING DEPARTMENT Finance C\\::>'('<\ Jean D. McGann Discussion lITEM NO. (1, Award Sale - 1999C GO Special Assessment Bond REOUEST: The Andover City Council is requested to award the sale of the 1999C GO Special Assessment Bond. The results of the sale and appropriate resolutions will be presented at the City Council meeting. Mr. Steve Maddson, a representative from Juran & Moody, is here tonight to present the results of the Cities bond sale. / Within your packets you will find a copy of the preliminary official statement issued for this bond sale. The City has maintained its' "A" Rating for this bond sale. BACKGROUND: On August 17, 1999 the Andover City Council authorized the sale of $3,525,000 General Obligation Special Assessment Bonds. The sale date was set for September 21, 1999 at 11 :00 AM Central Standard Time. I EXTRACT OF MINUTES OF A MEETING OF THE CITY COUNCIL OF THE CITY OF ANDOVER, MINNESOTA HELD: September 21, 1999 Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of Andover, Anoka County, Minnesota, was duly held at the City Hall in said City on Tuesday, the 21st day of September, 1999, at 7:00 P.M., for the purpose, in part, of considering proposals for, and awarding the sale of, $3,525,000 General Obligation Improvement Bonds of 1999 of the City. The following members were present: and the following were absent: Member and moved its adoption: introduced the following resolution '. ,,_ J RESOLUTION ACCEPTING PROPOSAL ON SALE OF $3,525,000 GENERAL OBLIGATION IMPROVEMENT BONDS OF 1999, PROVIDING FOR THEIR ISSUANCE, AND PLEDGING FOR THE SECURITY THEREOF SPECIAL ASSESSMENTS, AND LEVY OF A TAX FOR THE PAYMENT THEREOFF A. WHEREAS, the City Council of the City of Andover, Minnesota (the "City") has heretofore determined and declared that it is necessary and expedient to issue $3,525,000 General Obligation Improvement Bonds of 1999 (the "Bonds") of the City, pursuant to Minnesota Statutes, Chapters 429 and 475, to finance the construction of various improvements in the City (the "Improvements"); and B. WHEREAS, the Improvements and all their components have been ordered prior to the date hereof, after a hearing thereon for which notice was given describing the Improvements or all their components by general nature, estimated cost, and area to be assessed; and " , / C. WHEREAS, on August 17, 1999, the City Council adopted a resolution (the "Preliminary Resolution"), which provided for the private negotiation of the "Bonds;" and 1078532.1 D. WHEREAS I proposals to purchase the Bonds have been solicited by Juran & Moody ("Juran") in accordance with the Preliminary Resolution; and / E. WHEREAS, the proposals set forth on Exhibit A attached hereto were received and opened pursuant to the Official Terms of Bond Sale established for the Bonds in the presence of the Clerk, or designee, at the offices of Juran at 11:00 A.M., Central Time, this same day; and F. that the Bonds provided; and WHEREAS, it is in the best interests of the City be issued in book-entry form as hereinafter NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Andover, Minnesota, as follows: 1. Acceptance of Proposal. The proposal of (the "Purchaser"), to purchase the Bonds of the City (or individually, a "Bond"), in accordance with the Official Terms of Bond Sale, at the rates of interest hereinafter set forth, and to pay therefor the sum of $ , plus interest accrued to settlement, is hereby found, determined and declared to be the most favorable proposal received and is hereby accepted, and the Bonds are hereby awarded to said proposal maker, The City Clerk is directed to retain the deposit of said proposal maker and to forthwith return to the unsuccessful proposal makers their good faith checks and drafts. / 2 , Bond Terms. (a) Title: Oriqinal Issue Date: Denominations: Maturities: Term Bond Option, The Bonds shall be titled "General Obligation Improvement Bonds of 1999", shall be dated October 1, 1999, as the date of original issue and shall be issued forthwith on or after such date as fully registered bonds. The Bonds shall be numbered from R-1 upward in the denomination of $5,000 each or in any integral multiple thereof of a single maturity (the "Authorized Denominations"). The Bonds shall mature on December 1 in the years and amounts as follows: Year Amount 2000-2004 $705,000 All dates are inclusive. As may be requested by the Purchaser, one or more term Bonds may be issued having mandatory sinking fund redemption and final maturity amounts conforming to the foregoing principal repayment schedule, and corresponding additions may be made to the provisions of the applicable Bond(s) , " (b) Book Entrv Onlv Svstem. The Depository Trust Company, a limited purpose trust company organized under the laws 1078532.1 2 '. of the State of New York or any of its successors or its successors to its functions hereunder (the "Depository") will act as securities depository for the Bonds, and to this end: / (i) The Bonds shall be initially issued and, so long as they remain in book entry form only (the "Book Entry Only Period"), shall at all times be in the form of a separate single fully registered Bond for each maturity of the Bonds; and for purposes of complying with this requirement under paragraphs 5 and 10 Authorized Denominations for any Bond shall be deemed to be limited during the Book Entry Only Period to the outstanding principal amount of that Bond. (ii) Upon initial issuance, ownership of the Bonds shall be registered in a bond register maintained by the Bond Registrar (as hereinafter defined) in the name of CEDE & CO., as the nominee (it or any nominee of the existing or a successor Depository, the "Nominee"). / (iii) With respect to the Bonds neither the City nor the Bond Registrar shall have any responsibility or obligation to any broker, dealer, bank, or any other financial institution for which the Depository holds Bonds as securities depository (the "Participant") or the person for which a Participant holds an interest in the Bonds shown on the books and records of the Participant (the "Beneficial Owner"). Without limiting the immediately preceding sentence, neither the City, nor the Bond Registrar, shall have any such responsibility or obligation with respect to (A) the accuracy of the records of the Depository, the Nominee or any Participant with respect to any ownership interest in the Bonds, or (B) the delivery to any Participant, any Owner or any other person, other than the Depository, of any notice with respect to the Bonds, including any notice of redemption, or (C) the payment to any Participant, any Beneficial Owner or any other person, other than the Depository, of any amount with respect to the principal of or premium, if any, or interest on the Bonds, or (D) the consent given or other action taken by the Depository as the Registered Holder of any Bonds (the "Holder"). For purposes of securing the vote or consent of any Holder under this Resolution, the City may, however, rely upon an omnibus proxy under which the Depository assigns its consenting or voting rights to certain Participants to whose accounts the Bonds are credited on the record date identified in a listing attached to the omnibus proxy, (iv) The City and the Bond Registrar may treat as and deem the Depository to be the absolute owner of the Bonds for the purpose of payment of the principal of and premium, if any, and interest on the Bonds, for the purpose of giving notices of redemption and other matters with respect to the Bonds, for the purpose of obtaining any consent or other action to be taken by Holders for the purpose of registering '\ , I 1078532.1 3 / transfers with respect to such Bonds, and for all purpose whatsoever. The Bond Registrar, as paying agent hereunder I shall pay all principal of and premium, if any, and interest on the Bonds only to the Holder or the Holders of the Bonds as shown on the bond register, and all such payments shall be valid and effective to fully satisfy and discharge the City's obligations with respect to the principal of and premium, if any, and interest on the Bonds to the extent of the sum or sums .so paid. (v) Upon delivery by the Depository to the Bond Registrar of written notice to the effect that the Depository has determined to substitute a new Nominee in place of the existing Nominee, and subject to the transfer provisions in paragraph 10 hereof, references to the Nominee hereunder shall refer to such new Nominee, / (vi) So long as any Bond is registered in the name of a Nominee, all payments with respect to the principal of and premium, if any, and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, by the Bond Registrar or City, as the case may be, to the Depository as provided in the Letter of Representations to the Depository required by the Depository as a condition to its acting as book-entry Depository for the Bonds (said Letter of Representations, together with any replacement thereof or amendment or substitute thereto, including any standard procedures or policies referenced therein or applicable thereto respecting the procedures and other matters relating to the Depository's role as book-entry Depository for the Bonds, collectively hereinafter referred to as the "Letter of Representations") , (vii) All transfers of beneficial ownership interests in each Bond issued in book-entry form shall be limited in principal amount to Authorized Denominations and shall be effected by procedures by the Depository with the Participants for recording and transferring the ownership of beneficial interests in such Bonds. (viii) In connection with any notice or other communication to be provided to the Holders pursuant to this Resolution by the City or Bond Registrar with respect to any consent or other action to be taken by Holders, the Depository shall consider the date of receipt of notice requesting such consent or other action as the record date for such consent or other action; provided, that the City or the Bond Registrar may establish a special record date for such consent or other action. The City or the Bond Registrar shall, to the extent possible, give the Depository notice of such special record date not less than 15 calendar days in advance of such special record date to the extent possible. I 1078532.1 4 , I (ix) Any successor Bond Registrar in its written acceptance of its duties under this Resolution and any paying agency/bond registrar agreement, shall agree to take any actions necessary from time to time to comply with the requirements of the Letter of Representations. (x) In the case of a partial prepayment of a Bond, the Holder may, in lieu of surrendering the Bonds for a Bond of a lesser denomination as provided in paragraph 5 hereof, make a notation of the reduction in principal amount on the panel provided on the Bond stating the amount so redeemed. (c) Discontinuance termination of follows: Termination of Book-Entrv Onlv Svstem. of a particular Depository's services and the book-entry only system may be effected as (i) The Depository may determine to discontinue providing its services with respect to the Bonds at any time by giving written notice to the City and discharging its responsibilities with respect thereto under applicable law. The City may terminate the services of the Depository with respect to the Bond if it determines that the Depository is no longer able to carry out its functions as securities depository or the continuation of the system of book-entry transfers through the Depository is not in the best interests of the City or the Beneficial Owners. ~ J (ii) Upon termination of the services of the Depository as provided in the preceding paragraph, and if no substitute securities depository is willing to undertake the functions of the Depository hereunder can be found which, in the opinion of the City, is willing and able to assume such functions upon reasonable or customary terms, or if the City determines that it is in the best interests of the City or the Beneficial Owners of the Bond that the Beneficial Owners be able to obtain certificates for the Bonds, the Bonds shall no longer be registered as being registered in the bond register in the name of the Nominee, but may be registered in whatever name or names the Holder of the Bonds shall designate at that time, in accordance with paragraph 11 hereof. To the extent that the Beneficial Owners are designated as the transferee by the Holders, in accordance with paragraph 10 hereof, the Bonds will be delivered to the Beneficial Owners. (iii) Nothing in this subparagraph (c) shall limit or restrict the provisions of paragraph 10 hereof. (d) Letter of Representations. The provisions in the Letter of Representations are incorporated herein by reference and made a part of the resolution, and if and to the extent any such provisions are inconsistent with the other provisions of this resolution, the provisions in the Letter of Representations shall control. , ; 1078532.1 5 ., ) , , I " 3. Purpose. The Bonds shall provide funds to finance the Improvements. The total cost of the Improvements, which shall include all costs enumerated in Minnesota Statutes, Section 475.65, is estimated to be at least equal to the amount of the Bonds. Work on the Improvements shall proceed with due diligence to completion. The City covenants that it shall do all things and perform all acts required of it to assure that work on the Improvements proceeds with due diligence to completion and that any and all permits and studies required under law for the Improvements are obtained. 4. Interest. The Bonds shall bear interest payable semiannually on June 1 and December 1 of each year (each, an "Interest Payment Date"), commencing June 1, 2000, calculated on the basis of a 360-day year of twelve 30-day months, at the respective rates per annum set forth opposite the maturity years as follows: Maturity Year Interest Rate Maturity Year Interest Rate 2000 2001 2002 % 2003 2004 % 5. Redemption. All Bonds maturing in the years 2002 to 2004, both inclusive, shall be subject to redemption and prepayment at the option of the City on December 1, 2001, and on any Interest Payment Date thereafter at a price of par plus accrued interest. Redemption may be in whole or in part of the Bonds subject to prepayment, If redemption is in part, those Bonds remaining unpaid which have the latest maturity date shall be prepaid first; and if only part of the Bonds having a common maturity date are called for prepayment, the specific Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest thereon shall cease to accrue from and after the redemption date. Mailed notice of redemption shall be given to the paying agent and to each affected registered holder of the Bonds at least thirty (30) days prior to the date fixed for redemption. To effect a partial redemption of Bonds having a common maturity date, the Bond Registrar prior to giving notice of redemption shall assign to each Bond having a common maturity date a distinctive number for each $5,000 of the principal amount of such Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discre- tion, from the numbers so assigned to such Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of each such Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so 1078532.1 6 ~ selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the City or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the City and Bond Registrar duly executed by the holder thereof or his, her or its attorney duly authorized in writing) and the City shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the Holder of such Bond, without service charge, a new Bond or Bonds of the same series having the same stated maturity and interest rate and of any Authorized Denomination or Denominations, as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered. 6. Bond Reqistrar. U.S. Bank Trust National Association, in St. Paul, Minnesota, is appointed to act as bond registrar and transfer agent with respect to the Bonds (the "Bond Registrar"), and shall do so unless and until a successor Bond Registrar is duly appointed, all pursuant to any contract the City and Bond Registrar shall execute which is consistent herewith. The Bond Registrar shall also serve as paying agent unless and until a successor paying agent is duly appointed. Principal and interest on the Bonds shall be paid to the registered holders (or record holders) of the Bonds in the manner set forth in the form of Bond and paragraph 12 of this resolution. 7. Form of Bond. The Bonds, together with the Bond I Registrar's Certificate of Authentication, the form of Assignment and the registration information thereon, shall be in substantially the following form: 1078532.1 7 / UNITED STATES OF AMERICA STATE OF MINNESOTA ANOKA COUNTY CITY OF ANDOVER " R- $ GENERAL OBLIGATION IMPROVEMENT BOND OF 1999 INTEREST RATE MATURITY DATE DATE OF ORIGINAL ISSUE CUSIP OCTOBER 1, 1999 REGISTERED OWNER: PRINCIPAL AMOUNT: DOLLARS KNOW ALL PERSONS BY THESE PRESENTS that the City of Andover, Anoka County, Minnesota (the "Issuer"), certifies that it is indebted and for value received promises to pay to the registered owner specified above, or registered assigns, unless called for earlier redemption, in the manner hereinafter set forth, the principal amount specified above, on the maturity date , specified above, and to pay interest thereon semiannually on ) June 1 and December 1 of each year (each, an IIInterest Payment Date"), commencing June 1, 2000, at the rate per annum specified above (calculated on the basis of a 360-day year of twelve 30-day months) until the principal sum is paid or has been provided for. This Bond will bear interest from the most recent Interest Payment Date to which interest has been paid or, if no interest has been paid, from the date of original issue hereof. The principal of and premium, if any, on this Bond are payable upon presentation and surrender hereof at the principal office of U.S. Bank Trust National Association, in St. Paul, Minnesota (the "Bond Registrar"), acting as paying agent, or any successor paying agent duly appointed by the Issuer. Interest on this Bond will be paid on each Interest Payment Date by check or draft mailed to the person in whose name this Bond is registered (the "Holder" or "Bondholder") on the registration books of the Issuer maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth day of the calendar month next preceding such Interest Payment Date (the "Regular Record Date"). Any interest not so timely paid shall cease to be payable to the person who is the Holder hereof as of the Regular Record Date, and shall be payable to the person who is the Holder hereof at the close of business on a date (the "Special Record Date") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest. Notice of the Special Record Date shall be given to Bondholders not less -, than ten days prior to the Special Record Date. The principal of . ./ and premium, if any, and interest on this Bond are payable in 1078532.1 8 \ , / lawful money of the United States of America. [So long as this Bond is registered in the name of the Depository or its Nominee as provided in the Resolution hereinafter described, and as those ter.ms are defined therein, payment of principal of, premium, if any, and interest on this Bond and notice with respect thereto shall be made as provided in the Letter of Representations, as defined in the Resolution, and surrender of this Bond shall not be required for payment of the redemption price upon a partial redemption of this Bond. Until ter.mination of the book-entry only system pursuant to the Resolution, Bonds may only be registered in the name of the Depository or its Nominee.]" REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF, WHICH PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to happen and to be performed, precedent to and in the issuance of this Bond, have been done, have happened and have been performed, in regular and due form, time and manner as required by law, and that this Bond, together with all other debts of the Issuer outstanding on the date of original issue hereof and the date of its issuance and delivery to the original purchaser, does not exceed any constitutional or \ statutory limitation of indebtedness. / IN WITNESS WHEREOF, the City of Andover, Anoka County, Minnesota, by its City Council has caused this Bond to be executed on its behalf by the facsimile signatures of its Mayor and its Clerk, the corporate seal of the Issuer having been intentionally omitted as permitted by law. / Include only until termination of the book-entry only system under paragraph 2 hereof. , , 1078532.1 9 Date of Registration: Registrable by: U.S, BANK TRUST NATIONAL ASSOCIATION Payable at: U.S. BANK TRUST NATIONAL ASSOCIATION . / BOND REGISTRAR'S CERTIFICATE OF AUTHENTICATION This Bond is one of the Bonds described in the Resolution mentioned within. CITY OF ANDOVER, ANOKA COUNTY, MINNESOTA /s/ Facsimile Mayor /s/ Facsimile Clerk U.S, BANK TRUST NATIONAL ASSOCIATION St. Paul, Minnesota Bond Registrar By Authorized Signature / ;' 1078532.1 10 I \ ) .. , , J ON REVERSE OF BOND Redemption. All Bonds of this issue (the "Bonds") maturing in the years 2002 to 2004, both inclusive, are subject to redemption and prepayment at the option of the Issuer on December 1, 2001, and on any Interest Payment Date thereafter at a price of par plus accrued interest. Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, those Bonds remaining unpaid which have the latest maturity date shall be prepaid first; and if only part of the Bonds having a common maturity date are called for prepayment, the specific Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest thereon shall cease to accrue from and after the redemption date. Mailed notice of redemption shall be given to the paying agent and to each affected Holder of the Bonds at least thirty (30) days prior to the date fixed for redemption. Selection of Bonds for Redemption; Partial Redemption. To effect a partial redemption of Bonds having a common maturity date, the Bond Registrar shall assign to each Bond having a common maturity date a distinctive number for each $5,000 of the principal amount of such Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discretion, from the numbers assigned to the Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of such Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the Issuer or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the Issuer and Bond Registrar duly executed by the Holder thereof or his, her or its attorney duly authorized in writing) and the Issuer shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the Holder of such Bond, without service charge, a new Bond or Bonds of the same series having the same stated maturity and interest rate and of any Authorized Denomination or Denomina- tions, as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered. Issuance; Purpose; General Obliqation. This Bond is one of an issue in the total principal amount of $3,525,000, all of like date of original issue and tenor, except as to number, maturity, interest rate, denomination and redemption privilege, which Bond has been issued pursuant to and in full conformity with the Constitution and laws of the State of Minnesota and pursuant to a resolution adopted by the City Council of the Issuer on September 21, 1999 (the "Resolution"), for the purpose of providing money to finance the construction of various 1078532.1 11 improvements within the jurisdiction of the Issuer. This Bond is payable out of the General Obligation Improvement Bonds of 1999 ) Fund of the Issuer. This Bond constitutes a general obligation of the Issuer, and to provide moneys for the prompt and full payment of its principal, premium, if any, and interest when the same become due, the full faith and credit and taxing powers of the Issuer have been and are hereby irrevocably pledged. Denominations: Exchanqe: Resolution. The Bonds are issuable solely as fully registered bonds in Authorized Denominations (as defined in the Resolution) and are exchangeable for fully registered Bonds of other Authorized Denominations in equal aggregate principal amounts at the principal office of the Bond Registrar, but only in the manner and subject to the limitations provided in the Resolution. Reference is hereby made to the Resolution for a description of the rights and duties of the Bond Registrar. Copies of the Resolution are on file in the principal office of the Bond Registrar. " , Transfer. This Bond is transferable by the Holder in person or by his, her or its attorney duly authorized in writing at the principal office of the Bond Registrar upon presentation and surrender hereof to the Bond Registrar, all subject to the terms and conditions provided in the Resolution and to reasonable regulations of the Issuer contained in any agreement with the Bond Registrar. Thereupon the Issuer shall execute and the Bond Registrar shall authenticate and deliver, in exchange for this Bond, one or more new fully registered Bonds in the name of the transferee (but not registered in blank or to "bearer" or similar designation), of an Authorized Denomination or Denominations, in aggregate principal amount equal to the principal amount of this Bond, of the same maturity and bearing interest at the same rate. / Fees upon Transfer or Loss. The Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of this Bond and any legal or unusual costs regarding transfers and lost Bonds. Treatment of Reqistered Owners, The Issuer and Bond Registrar may treat the person in whose name this Bond is registered as the owner hereof for the purpose of receiving payment as herein provided (except as otherwise provided on the reverse side hereof with respect to the Record Date) and for all other purposes, whether or not this Bond shall be overdue, and neither the Issuer nor the Bond Registrar shall be affected by notice to the contrary. Authentication. This Bond shall not be valid or become obligatory for any purpose or be entitled to any security unless the Certificate of Authentication hereon shall have been executed by the Bond Registrar, . , Oualified Tax-Exempt Obliaation. This Bond has been designated by the Issuer as a "qualified tax-exempt obligation" , / 1078532.1 12 , '. / / , I / for purposes of Section 265(b) (3) of the Internal Revenue Code of 1986, as amended. ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this Bond, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM TEN ENT JT TEN - UTMA - - as tenants in common - as tenants by the entireties as joint tenants with right of and not as tenants in common as custodian for survivorship (Cust) under the (Minor) Uniform (State) Transfers to Minors Act Additional abbreviations may also be used though not in the above list. 1078532.1 13 ASSIGNMENT , / For value received, the undersigned hereby sells, assigns and transfers unto the within Bond and does hereby irrevocably constitute and appoint attorney to transfer the Bond on the books kept for the registration thereof, with full power of substitution in the premises. Dated: Notice: The assignor's signature to this assignment must correspond with the name as it appears upon the face of the within Bond in every particular, without alteration or any change whatever. Signature Guaranteed: Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm having a membership in one of the major stock exchanges or any other "Eligible Guarantor Institution" as defined in 17 CFR 240.17 Ad-15 (a) (2). .' The Bond Registrar will not effect transfer of this Bond unless the information concerning the transferee requested below is provided. Name and Address: (Include information for all joint owners if the Bond is held by joint account.) . , , / 1078532.1 14 , , / , / " , / [Use only for Bonds when they are Registered in Book Entry Only System] PREPAYMENT SCHEDULE This Bond has been prepaid in part on the date(s) and in the amount(s) as follows: DATE 1078532.1 AMOUNT IS AUTHORIZED SIGNATURE OF HOLDER / / 8. Execution; Temporarv Bonds. The Bonds shall be printed (or, at the request of the Purchaser, typewritten) and shall be executed on behalf of the City by the signatures of its Mayor and Clerk and be sealed with the seal of the City; provided, however, that the seal of the City may be a printed (or, at the request of the Purchaser, photocopied) facsimile; and provided further that both of such signatures may be printed (or, at the request of the Purchaser, photocopied) facsimiles and the corporate seal may be omitted on the Bonds as permitted by law. In the event of disability or resignation or other absence of either such officer, the Bonds may be signed by the manual or facsimile signature of that officer who may act on behalf of such absent or disabled officer. In case either such officer whose signature or facsimile of whose signature shall appear on the Bonds shall cease to be such officer before the delivery of the Bonds, such signature or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if he or she had remained in office until delivery. The City may elect to deliver, in lieu of printed definitive bonds, one or more typewritten temporary bonds in substantially the form set forth above, with such changes as may be necessary to reflect more than one maturity in a single temporary bond. Such temporary bonds may be executed with photocopied facsimile signatures of the Mayor and Clerk. Such temporary bonds shall, upon the printing of the definitive bonds and the execution thereof, be exchanged therefor and canceled. 9, Authentication. No Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit under this resolution unless a Certificate of Authentication on such Bond, substantially in the form hereinabove set forth, shall have been duly executed by an authorized representative of the Bond Registrar. Certificates of Authentication on different Bonds need not be signed by the same person. The Bond Registrar shall authenticate the signatures of officers of the City on each Bond by execution of the Certificate of Authentication on the Bond and by inserting as the date of registration in the space provided the date on which the Bond is authenticated, except that for purposes of delivering the original Bonds to the Purchaser, the Bond Registrar shall insert as a date of registration the date of original issue, which date is October 1, 1999. The Certificate of Authentication so executed on each Bond shall be conclusive evidence that it has been authenticated and delivered under this resolution, 10. Reqistration; Transfer; Exchanqe. The City will cause to be kept at the principal office of the Bond Registrar a bond register in which, subject to such reasonable regulations as the Bond Registrar may prescribe, the Bond Registrar shall provide for the registration of Bonds and the registration of transfers of Bonds entitled to be registered or transferred as herein provided. Upon surrender for transfer of any Bond at the / principal office of the Bond Registrar, the City shall execute 1078532.1 16 , I (if necessary), and the Bond Registrar shall authenticate, insert the date of registration (as provided in paragraph 9) of, and deliver, in the name of the designated transferee or transferees, one or more new Bonds of any Authorized Denomination or Denominations of a like aggregate principal amount, having the same stated maturity and interest rate, as requested by the transferor; provided, however, that no Bond may be registered in blank or in the name of "bearer" or similar designation, ~ At the option of the Holder, Bonds may be exchanged for Bonds of any Authorized Denomination or Denominations of a like aggregate principal amount and stated maturity, upon surrender of the Bonds to be exchanged at the principal office of the Bond Registrar. Whenever any Bonds are so surrendered for exchange, the City shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of registration of, and deliver the Bonds which the Holder making the exchange is entitled to receive. All Bonds surrendered upon any exchange or transfer provided for in this resolution shall be promptly canceled by the Bond Registrar and thereafter disposed of as directed by the City. All Bonds delivered in exchange for or upon transfer of Bonds shall be valid general obligations of the City evidencing the same debt, and entitled to the same benefits under this '\ resolution, as the Bonds surrendered for such exchange or transfer. Every Bond presented or surrendered for transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer, in form satisfactory to the Bond Registrar, duly executed by the Holder thereof or his, her or its attorney duly authorized in writing. The Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of any Bond and any legal or unusual costs regarding transfers and lost Bonds. Transfers shall also be subject to reasonable regulations of the City contained in any agreement with the Bond Registrar, including regulations which permit the Bond Registrar to close its transfer books between record dates and payment dates. The Clerk is hereby authorized to negotiate and execute the terms of said agreement. 11. Riqhts Upon Transfer or Exchanqe. Each Bond delivered upon transfer of or in exchange for or in lieu of any other Bond shall carryall the rights to interest accrued and unpaid, and to accrue, which were carried by such other Bond. , , 12. Interest PaYment: Record Date. Interest on any Bond shall be paid on each Interest Payment Date by check or 1078532.1 17 '\ draft mailed to the person in whose name the Bond is registered (the "Holder") on the registration books of the City maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth (15th) day of the calendar month next preceding such Interest Payment Date (the "Regular Record Date"). Any such interest not so timely paid shall cease to be payable to the person who is the Holder thereof as of the Regular Record Date, and shall be payable to the person who is the Holder thereof at the close of business on a date (the "Special Record Date") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest, Notice of the Special Record Date shall be given by the Bond Registrar to the Holders not less than ten (10) days prior to the Special Record Date. 13. Treatment of Reoistered Owner. The City and Bond Registrar may treat the person in whose name any Bond is registered as the owner of such Bond for the purpose of receiving payment of principal of and premium, if any, and interest (subject to the payment provisions in paragraph 12 above) on, such Bond and for all other purposes whatsoever whether or not such Bond shall be overdue, and neither the City nor the Bond Registrar shall be affected by notice to the contrary. 14. Deliverv: Application of Proceeds. The Bonds when so prepared and executed shall be delivered by the Treasurer to the Purchaser upon receipt of the purchase price, and the '\ Purchaser shall not be obliged to see to the proper application thereof. 15. Fund and Accounts. There is hereby created a special fund to be designated the "General Obligation Improvement Bonds of 1999 Fund" (the "Fund") to be administered and maintained by the Treasurer as a bookkeeping account separate and apart from all other funds maintained in the official financial records of the City. The Fund shall be maintained in the manner herein specified until all of the Bonds and the interest thereon have been fully paid, There shall be maintained in the Fund two (2) separate accounts, to be designated the "Construction Account" and "Debt Service Account", respectively. , . (a) Construction Account. To the Construction Account there shall be credited the proceeds of the sale of the Bonds, less accrued interest received thereon, and less any amount paid for the Bonds in excess of $3,489,750, and less capitalized interest in the amount of $ (together with interest earnings thereon) and subject to such other adjustments as are appropriate to provide sufficient funds to pay interest due on the Bonds on or before June 1, 2000), plus any special assessments levied with respect to the Improvements and collected prior to completion of the Improvements and payment of the costs thereof. From the Construction Account there shall be paid all costs and expenses of making the Improvements listed in paragraph 16, including the cost of any construction contracts heretofore let and all other costs incurred and to be incurred of the kind 1078532.1 18 ) / , -) / authorized in Minnesota Statutes, Section 475.65; and the moneys in said account shall be used for no other purpose except as otherwise provided by law; provided that the proceeds of the Bonds may also be used to the extent necessary to pay interest on the Bonds due prior to the anticipated date of commencement of the collection of taxes or special assessments herein levied or covenanted to be levied; and provided further that if upon completion of the Improvements there shall remain any unexpended balance in the Construction Account, the balance (other than any special assessments) may be transferred by the Council to the fund of any other improvement instituted pursuant to Minnesota Statutes, Chapter 429, and provided further that any special assessments credited to the Construction Account shall only be applied towards payment of the costs of the Improvements upon adoption of a resolution by the City Council determining that the application of the special assessments for such purpose will not cause the City to no longer be in compliance with Minnesota Statutes, Section 475.61, Subdivision 1. (b) Debt Service Account. There are hereby irrevocably appropriated and pledged to, and there shall be credited to, the Debt Service Account: (i) all collections of special assessments herein covenanted to be levied with respect to the Improvements and either initially credited to the Construction Account and not already spent as permitted above and required to pay any principal and interest due on the Bonds or collected subsequent to the completion of the Improvements and payment of the costs thereof; (ii) all accrued interest received upon delivery of the Bonds; (iii) all funds paid for the Bonds in excess of $3,489,750; (iv) capitalized interest in the amount of $ (together with interest earnings thereon and subject to such other adjustments as are appropriate to provide sufficient funds to pay interest due on the Bonds on or before June 1, 2000); (v) all collections of taxes herein or hereafter levied for the payment of the principal and interest of the Bonds; (vi) all funds remaining in the Construction Account after completion of the Improvements and payment of the costs thereof, not so transferred to the account of another improvement; (vii) all investment earnings on funds held in the Debt Service Account; and (viii) any and all other moneys which are properly available and are appropriated by the governing body of the City to the Debt Service Account. The Debt Service Account shall be used solely to pay the principal and interest and any premiums for redemption of the Bonds and any other general obligation bonds of the City hereafter issued by the City and made payable from said account as provided by law. No portion of the proceeds of the Bonds shall be used directly or indirectly to acquire higher yielding investments or to replace funds which were used directly or indirectly to acquire higher yielding investments, except (1) for a reasonable temporary period until such proceeds are needed for the purpose for which the Bonds were issued and (2) in addition to the above in an amount not greater than the lesser of five percent (5%) of the proceeds of the Bonds or $100,000. To this effect, any 1078532.1 19 ~ ) .J - , / proceeds of the Bonds and any sums from time to time held in the Construction Account or Debt Service Account (or any other City account which will be used to pay principal or interest to become due on the bonds payable therefrom) in excess of amounts which under then-applicable federal arbitrage regulations may be invested without regard to yield shall not be invested at a yield in excess of the applicable yield restrictions imposed by said arbitrage regulations on such investments after taking into account any applicable "temporary periods" or "minor portion" made available under the federal arbitrage regulations. Money in the Fund shall not be invested in obligations or deposits issued by, guaranteed by or insured by the United States or any agency or instrumentality thereof if and to the extent that such investment would cause the Bonds to be "federally guaranteed" within the meaning of Section 149(b) of the Internal Revenue Code of 1986, as amended (the "Code"). 16. Assessments. It is hereby determined that no less than twenty percent (20%) of the cost to the City of each Improvement financed hereunder within the meaning of Minnesota Statutes, Section 475.58, Subdivision 1(3), shall be paid by special assessments to be levied against every assessable lot, piece and parcel of land benefitted by any of the Improvements. The City hereby covenants and agrees that it will let all construction contracts not heretofore let within one (1) year after ordering each Improvement financed hereunder unless the resolution ordering the Improvement specifies a different time limit for the letting of construction contracts. The City hereby further covenants and agrees that it will do and perform as soon as they may be done all acts and things necessary for the final and valid levy of such special assessments, and in the event that any such assessment be at any time held invalid with respect to any lot, piece or parcel of land due to any error, defect, or irregularity in any action or proceedings taken or to be taken by the City or the City Councilor any of the City officers or employees, either in the making of the assessments or in the performance of any condition precedent thereto, the City and the City Council will forthwith do all further acts and take all further proceedings as may be required by law to make the assessments a valid and binding lien upon such property, The special assessments have not heretofore been authorized, and accordingly, for purposes of Minnesota Statutes, Section 475.55, Subdivision 3, the special assessments are hereby authorized. Subject to such adjustments as are required by the conditions in existence at the time the assessments are levied, it is hereby determined that the assessments shall be payable in equal, consecutive, annual installments, with general taxes for the years shown below and with interest on the declining balance of all such assessments at a rate per annum not greater than the maximum permitted by law and not less than the rate per annum set forth opposite the collection years specified below: 1078532.1 20 " / Improvement Desiqnation Amount Levv Years Collection Years Rate $ 1999-2003 2000-2004 % At the time the assessments are in fact levied the City Council shall, based on the then-current estimated collections of the assessments, make any adjustments in any ad valorem taxes required to be levied in order to assure that the City continues to be in compliance with Minnesota Statutes, Section 475,61, Subdivision 1, 17. Tax Levv; Coveraqe Test. To provide moneys for payment of the principal and interest on the Bonds there is hereby levied upon all of the taxable property in the City a direct annual ad valorem tax which shall be spread upon the tax rolls and collected with and as part of other general property taxes in the City for the years and in the amounts as follows: Year of Tax Year of Tax Levv Collection Amount 1999 2000 $ 2000 2001 2001 2002 2002 2003 , "- 2003 2004 , , - J The tax levies are such that if collected in full they, together with estimated collections of special assessments and other revenues herein pledged for the payment of the Bonds, will produce at least five percent (5%) in excess of the amount needed to meet when due the principal and interest payments on the Bonds. The tax levies shall be irrepealable so long as any of the Bonds are outstanding and unpaid, provided that the City reserves the right and power to reduce the levies in the manner and to the extent permitted by Minnesota Statutes, Section 475.61, Subdivision 3. 18. Defeasance. When all Bonds have been discharged as provided in this paragraph, all pledges, covenants and other rights granted by this resolution to the registered holders of the Bonds shall, to the extent permitted by law, cease. The City may discharge its obligations with respect to any Bonds which are due on any date by irrevocably depositing with the Bond Registrar on or before that date a sum sufficient for the payment thereof in full; or if any Bond should not be paid when due, it may nevertheless be discharged by depositing with the Bond Registrar a sum sufficient for the payment thereof in full with interest accrued to the date of such deposit. The City may also discharge its obligations with respect to any prepayable Bonds called for redemption on any date when they are prepayable according to " their terms, by depositing with the Bond Registrar on or before , ) that date a sum sufficient for the payment thereof in full, 1078532.1 21 '. I provided that notice of redemption thereof has been duly given. The City may also at any time discharge its obligations with respect to any Bonds, subject to the provisions of law now or hereafter authorizing and regulating such action, by depositing irrevocably in escrow, with a suitable banking institution qualified by law as an escrow agent for this purpose, cash or securities described in Minnesota Statutes, Section 475.67, Subdivision 8, bearing interest payable at such times and at such rates and maturing on such dates as shall be required, without regard to sale and/or reinvestment, to pay all amounts to become due thereon to maturity or, if notice of redemption as herein required has been duly provided for, to such earlier redemption date. 19. Compliance With Reimbursement Bond Requlations. The provisions of this paragraph are intended to establish and provide for the City's compliance with United States Treasury Regulations Section 1.150-2 (the "Reimbursement Regulations") applicable to the "reimbursement proceeds" of the Bonds, being those portions thereof which will be used by the City to reimburse itself for any expenditure which the City paid or will have paid prior to the Closing Date (a "Reimbursement Expenditure") . The City hereby certifies and/or covenants as follows: , / (a) Not later than 60 days after the date of payment of a Reimbursement Expenditure, the City (or person designated to do so on behalf of the City) has made or will have made a written declaration of the City's official intent (a "Declaration") which effectively (i) states the City's reasonable expectation to reimburse itself for the payment of the Reimbursement Expenditure out of the proceeds of a subsequent borrowing; (ii) gives a general and functional description of the property, project or program to which the Declaration relates and for which the Reimbursement Expenditure is paid, or identifies a specific fund or account of the City and the general functional purpose thereof from which the Reimbursement Expenditure was to be paid (collectively the "Project"); and (iii) states the maximum principal amount of debt expected to be issued by the City for the purpose of financing the Project; provided, however, that no such Declaration shall necessarily have been made with respect to: (i) "preliminary expenditures" for the Project, defined in the Reimbursement Regulations to include engineering or architectural, surveying and soil testing expenses and similar prefatory costs, which in the aggregate do not exceed 20% of the "issue price" of the Bonds, and (ii) a de minimis amount of Reimbursement Expenditures not in excess of the lesser of $100,000 or 5% of the proceeds of the Bonds. Notwithstanding the foregoing, with respect to any Declaration made by the City . , '- j 1078532.1 22 ., , / between January 27, 1992 and June 30, 1993, with respect to a Reimbursement Expenditure made prior to March 2, 1992, the City hereby represents that there exists objective evidence, that at the time the Expenditure was paid the City expected to reimburse the cost thereof with the proceeds of a borrowing (taxable or tax-exempt) and that expectation was reasonable. (b) Each Reimbursement Expenditure is a capital expenditure or a cost of issuance of the Bonds or any of the other types of expenditures described in Section 1.150- 2(d) (3) of the Reimbursement Regulations. (c) The "reimbursement allocation" described in the Reimbursement Regulations for each Reimbursement Expenditure shall and will be made forthwith following (but not prior to) the issuance of the Bonds and in all events within the period ending on the date which is the later of three years after payment of the Reimbursement Expenditure or one year after the date on which the Project to which the Reimbursement Expenditure relates is first placed in service. (d) Each such reimbursement allocation will be made in a writing that evidences the City's use of Bond proceeds to reimburse the Reimbursement Expenditure and, if made within 30 days after the Bonds are issued, shall be treated as made on the day the Bonds are issued. "' Provided, however, that the City may take action contrary to any of the foregoing covenants in this paragraph 19 upon receipt of an opinion of its Bond Counsel for the Bonds stating in effect that such action will not impair the tax-exempt status of the Bonds, 20. Continuinq Disclosure, The City is the sole obligated person with respect to the Bonds. The City hereby agrees, in accordance with the provisions of Rule 15c2-12 (the "Rule"), promulgated by the Securities and Exchange Commission (the "Commission") pursuant to the Securities Exchange Act of 1934, as amended, and a Continuing Disclosure Undertaking (the "Undertaking") hereinafter described to: (a) Provide or cause to be provided to each nationally recognized municipal securities information repository ("NRMSIR") and to the appropriate state information depository ("SID"), if any, for the State of Minnesota, in each case as designated by the Commission in accordance with the Rule, certain annual financial information and operating data in accordance with the Undertaking, The City reserves the right to modify from time to time the terms of the Undertaking as provided therein. , / (b) (i) each ("MSRB" ) 1078532.1 Provide or cause to be provided, in a timely manner, to NRMSIR or to the Municipal Securities Rulemaking Board and (ii) the SID, notice of the occurrence of certain 23 , , material events with respect to the Bonds in accordance with the Undertaking. (c) Provide or cause to be provided, in a timely manner, to (i) each NRMSIR or to the MSRB and (ii) the SID, notice of a failure by the City to provide the annual financial information with respect to the City described in the Undertaking. (d) The City agrees that its covenants pursuant to the Rule set forth in this paragraph 20 and in the Undertaking is intended to be for the benefit of the Holders of the Bonds and shall be enforceable on behalf of such Holders; provided that the right to enforce the provisions of these covenants shall be limited to a right to obtain specific enforcement of the City's obligations under the covenants. The Mayor and Clerk of the City, or any other officer of the City authorized to act in their place with "Officers" are hereby authorized and directed to execute on behalf of the City the Undertaking in substantially the form presented to the City Council subject to such modifications thereof or additions thereto as are (i) consistent with the requirements under the Rule, (ii) required by the Purchaser of the Bonds, and (iii) acceptable to the Officers. \ 21. General Obliqation Pledqe. For the prompt and full payment of the principal and interest on the Bonds, as the same respectively become due, the full faith, credit and taxing powers of the City shall be and are hereby irrevocably pledged. If the balance in the Debt Service Account is ever insufficient to pay all principal and interest then due on the Bonds and any other bonds payable therefrom, the deficiency shall be promptly paid out of any other funds of the City which are available for such purpose, and such other funds may be reimbursed with or without interest from the Debt Service Account when a sufficient balance is available therein. 22. Certificate of Reqistration. The Clerk is hereby directed to file a certified copy of this resolution with the County Auditor of Anoka County, Minnesota, together with such other information as he or she shall require, and to obtain the County Auditor's certificate that the Bonds have been entered in the County Auditor's Bond Register, and that the tax levy required by law has been made. 23. Records and Certificates. The officers of the City are hereby authorized and directed to prepare and furnish to the Purchaser, and to the attorneys approving the legality of the issuance of the Bonds, certified copies of all proceedings and records of the City relating to the Bonds and to the financial condition and affairs of the City, and such other affidavits, certificates and information as are required to show the facts relating to the legality and marketability of the Bonds as the same appear from the books and records under their custody and / control or as otherwise known to them, and all such certified 1078532.1 24 ., J / copies, certificates and affidavits, including any heretofore furnished, shall be deemed representations of the City as to the facts recited therein. 24. Neqative Covenant as to Use of Proceeds and Improvements. The City hereby covenants not to use the proceeds of the Bonds or to use the Improvements, or to cause or permit them to be used, or to enter into any deferred payment arrangements for the cost of the Improvements, in such a manner as to cause the Bonds to be "private activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code, 25. Tax-Exempt Status of the Bonds; Rebate; Elections. The City shall comply with requirements necessary under the Code to establish and maintain the exclusion from gross income under Section 103 of the Code of the interest on the Bonds, including without limitation (1) requirements relating to temporary periods for investments, (2) limitations on amounts invested at a yield greater than the yield on the Bonds, and (3) the rebate of excess investment earnings to the United States, If any elections are available now or hereafter with respect to arbitrage or rebate matters relating to the Bonds, the Mayor, Clerk and Treasurer or any of them, are hereby authorized and directed to make such elections as they deem necessary, appropriate or desirable in connection with the Bonds, and all such elections shall be, and shall be deemed and treated as, ~ elections of the City. " 26, Desiqnation of Oualified Tax-Exempt Obliqations. In order to qualify the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b) (3) of the Code, the City hereby makes the following factual statements and representations: (a) the Bonds are issued after August 7, 1986; (b) the Bonds are not "private activity bonds" as defined in Section 141 of the Code; (c) the City hereby designates the Bonds as "qualified tax-exempt obligations" for purposes of Section 265(b) (3) of the Code; , J I (d) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds, treating qualified 501(c) (3) bonds as not being private activity bonds) which will be issued by the City (and all entities treated as one issuer with the City, and all subordinate entities whose obligations are treated as issued by the City) during this calendar year 1999 will not exceed $10,000,000; and (e) not more than $10,000,000 of obligations issued by the City during this calendar year 1999 have 1078532.1 25 , I , been designated for purposes of Section 265(b) (3) of the Code. The City shall use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designation made by this paragraph. 27. Severabilitv, If any section, paragraph or provision of this resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this resolution. 28. Headinos. Headings in this resolution are included for convenience of reference only and are not a part hereof, and shall not limit or define the meaning of any provision hereof. The motion for the adoption of was duly seconded by member discussion thereof and upon a vote being following voted in favor thereof: the foregoing resolution and, after a full taken thereon, the and the following voted against the same: -, Whereupon said resolution was declared duly passed and ) adopted, , ) 1078532.1 26 -, " " "- , STATE OF MINNESOTA COUNTY OF ANOKA CITY OF ANDOVER I, the undersigned, being the duly qualified and acting Clerk of the City of Andover, Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the original thereof on file in my office, and that the same is a full, true and complete transcript of the minutes of a meeting of the City Council of said City, duly called and held on the date therein indicated, insofar as such minutes relate to considering proposals for, and awarding the sale of, $3,525,000 General Obligation Improvement Bonds of 1999 of said City. WITNESS my hand this 21st day of September, 1999. Clerk (SEAL) 1078532.1 27 " " , J 1078532.1 , EXHIBIT A PROPOSALS [To be supplied by Juran & Moody] A-l CITY OF ANDOVER REQUEST FOR COUNCIL ACTION \ I DATE: September 2 L 1999 AGENDA SECTION ORIGINATING DEPARTMENT Discussion Planning Jeff Johnson ITEM NO. Approve Ordinance No. 247 Right-of-Way Management Ordinance ~, Request The City Council is asked to review and approve the attached ordinance for the City to manage its public right-of-ways and recover its right-of-way management costs. Plannilll! and Zonin!! Commission Review At the August 10, 1999 Planning and Zoning Commission, the Commission reviewed the ordinance. The ordinance was drafted by the City Attorney and is similar to the model ordinance from the League of Minnesota Cities and the City of Anoka. " I The Planning and Zoning Commission recommends approval (unanimously) to the City CounciI of the ordinance. Attachments An Ordinance Providing for the Public Right-of-Way Management Planning and Zoning Commission Meeting Minutes - 8/1 0/99 City Council Meeting Minutes - 3/16/99 Notice of Public Hearing . \ I CITY OF ANDOVER COUNTY OF ANOKA STATE OF MINNESOTA ORDINANCE NO. 247 AN ORDINANCE PROVIDING FOR PUBLIC-RIGHT-OF-W A Y MANAGEMENT. The City Council of the City of Andover hereby ordains as follows: SECTION 1. The Code ofthe City of Andover is hereby amended by providing for a public right-of-way management. Article 1. Election to Manage Public Right-of-Wav Sec. I. Purpose. The purpose of this Article is to provide an ordinance for the City (a) to manage its public rights-of-way and to recover its rights-of-way management costs and (b )to regulate the use ofpubIic rights-of-way by providers of telecommunication services, public utility services, and the like, in a fair, efficient, competitively neutral and substantially uniform manner, consistent with and to the extent authorized by Minnesota Law, specifically Minnesota Statutes, Secs. 237.162, 237.163, 237.79, 237.81 and 238.086 (1997) and Minnesota Public Utility Commission Rules 7819.0050 through 7819.9950. Sec. 2. Definitions. For the purposes of this Article, the following words and phrases shall have the meanings respectively ascribed to them by this Section. (a) "Applicant" means any Person requesting permission to Excavate or Obstruct a Right-of-Way. (b) "City" means the City of Andover, Minnesota. For purposes of this Ordinance, City means its elected officials, officers, employees, agents or any commission, committee or subdivision acting pursuant to lawfully delegated authority. (c) "City Cost" means the actual costs incurred by the City for managing Rights-of-Way including, but not Iimited to costs associated with registering of applicants, issuing, processing, and verifying Right-of-Way Permit applications; revoking Right-of-Way Permits; inspecting job sites; creating and updating mapping systems; determining the adequacy of Right-of-Way restoration; restoring work inadequately performed; maintaining, supporting, protecting, or moving user equipment during J I '. I (g) (h) .' Right-of-Way work; budget analysis; record keeping; legal assistance; systems analysis; and performing all of the other tasks required by this Article, including other costs the City may incur in managing the provisions of this Article except as expressly prohibited by law. (d) "City Inspector" means any Person authorized by the City to carry out inspections related to the provisions of this Article. (e) "Commission" means the State Public Utilities Commission. (f) "Degradation" means the accelerated depreciation of the Right-of-Way caused by Excavation in or disturbance of the Right-of-Way, resulting in the need to reconstruct such Right-of-Way earlier than would be required if the Excavation did not occur, not to exceed the maximum restoration shown in plates 1 to 13, set forth in Minnesota RuIes parts 7819.9900 to 7819.9950. "Emergency" means a condition that (a) poses a clear and immediate danger to life or health, or of a significant loss of property; or (b) requires immediate repair or replacement in order to restore Service to a customer. "Equipment" means any tangibIe thing located in any Right-of-Way; but shall not include boulevard plantings or gardens planted or maintained in the Right-of-Way between a Person's property and the street curb. (i) "Excavate" means to dig into or in any way remove or physically disturb or penetrate any part ofa Right-of-Way. (j) "Excavation Permit" means the Permit which, pursuant to this Article, must be obtained before a Person may excavate in a Right-of-Way. An Excavation Permit allows the holder to Excavate that part of the Right-of- Way described in such Permit. (k) "Excavation Permit Fee" means money paid to the City by an Applicant to cover the costs as provided in Section 12. (1) "High Density Corridor" means a designated portion of the public Right- of-Way within which Right-of-Way users having multiple and competing facilities may be required to bilI and install facilities in a common conduit system or other common structure. (m) "Local Representative" means the Person or Persons, or designee of such Person or Persons, authorized by a Registrant to accept Service and to make decisions for that Registrant regarding all matters within the scope of this Article. 2 (n) "Obstruction Permit" means the Permit which, pursuant to this Article, must be obtained before a person may obstruct a Right-of-Way, allowing the holder to hinder free and open passage over the specified portion of a Right-of-Way by placing Equipment described therein on the Right-of- Way for the duration specified therein. I (0) "Obstruction Permit Fee" means money paid to the City by a Registrant to cover the costs as provided in Section 12. (P) "Performance and Restoration Bond" means any of the following forms of security: (1) individual project bond; (2) cash deposit; (3) security in the form ofa listed or approved under Minn. Stat. S 15.73, Subd. 3; (4) letter of credit in a form acceptable to the City; (5) self insurance in a form acceptable to the City; (6) blanket bond for projects within the City or other form of construction bond for time specified in a form acceptable to the City. (q) "Permittee" means any Person to whom a Permit to Excavate or Obstruct a Right-of-Way has been granted by the City under this Article. (r) "Person" means any naturaI or corporate Person, business association or other business entity including, but not limited to, a partnership, a sole proprietorship, a po Ii tical subdivision, a public or private agency of any kind, a utility, a successor or assign of any of the foregoing, or any other legal entity which has or seeks to have Equipment located in any Right-of- Way. (s) "Public Right-of-Way" means the area on, below, or above a public roadway, highway, street, cartway, bicycle lane and public sidewalk in which the City has an interest, including other dedicated rights-of-way for travel purposes and utility easements of the City. A right-of-way does not include the airwaves above a right-of-way with regard to cellular or other nonwire teIecommunications or broadcast service. (t) "Probation" means the status of a Person that has not complied with the conditions of this Article. (u) "Probation Period" means one (1) year from the date that a Person has been notified in writing that they have been put on Probation. (v) "Registrant" means any Person who (1) has or seeks to have its Equipment located in any Right-of Way, or (2) in any way occupies or uses, or seeks to occupy or use, the Right-of-Way or any Equipment located in the Right- of-Way and, accordingIy, is required to register with the City. 3 (w) "Right-of-Way Permit" means either the Excavation Permit or the Obstruction Permit, or both, depending on the context, required by this Article. (x) "Rules" means Rule 7819.0050 through 7819.9950 adopted by the Commission. (y) "Telecommunication Right-of-Way User" means a Person owning or controlling a facility in the Right-of-Way, or seeking to own or control the same, that is used or is intended to be used for transporting teIecommunication or other voice or data information. For purposes of this Article, a cable communications system defined and reguIated under Minn. Stat. Chap. 238, and telecommunications activities related to providing natural gas or electric energy services are not included in this definition for purposes ofthis Article. This definition shall not be inconsistent with Minn. Stat. ~ 237.162, Subd. 4. Sec. 3. Administration. The City may designate a principal City official responsible for the administration of the Rights-of-Way, Right-of-Way Permits, and the ordinances reIated thereto. The City may deIegate any or all of the duties hereunder. Sec. 4. Registration. Bonding and Right-of-Wav Occupancv. Subd. 1. Each Person which occupies, uses, or seeks to occupy or use, the Right-of- Way or any Equipment located in the Right-of-Way, including by lease, sublease or assignment, or who has, or seeks to have, Equipment located in any Right-of-Way must register with the City. Registration will consist of providing appIication information to and as required by the City, paying a registration fee, and posting a'performance and Restoration Bond. / The Performance and Restoration Bond required in this Section, and in Sections 10, Subd. 2; 13, Subd. 2(b) and Section 32, Subd. 1(b)(3) shall be in an amount determined in the City's sole discretion, sufficient to serve as security for the full and complete performance of the obligations under this Article, including any costs, expenses, damages, or loss the City pays or incurs because of any failure to comply with this Article or any other applicable laws, regulations or standards. During periods of construction, repair or Restoration of Rights-of-Way or Equipment in Rights-of-Way, the Performance and Restoration Bond shall be in an amount sufficient to cover 100% of the estimated cost of such work, as documented by the Person proposing to perform such work, or in such lesser amount as may be determined by the City, taking into account the amount of Equipment in the Right-of-Way, the location and method of installation of the Equipment, the conflict or interference of such Equipment with the Equipment of other Persons, and the purposes and poIicies of this Article. Sixty (60) days after compIetion of 4 the work, the Performance and Restoration Bond may be reduced in the sole determination of the City. Subd. 2, No person shall construct, install, repair, remove, relocate, or perform any other work on, or use any Equipment or any part thereoflocated in any Right-of-Way without first being registered with the City. Subd. 3. Nothing herein shall be construed to repeaI or amend the provisions of a City ordinance permitting Persons to plant or maintain boulevard plantings or gardens or in the area of Right-of-Way between their property and the street curb. Persons planting or maintaining boulevard plantings or gardens shall not be deemed to use or occupy the Right-of-Way, and shall not be required to obtain any Permits to satisfy any other requirements for planting or maintaining such boulevard plantings or gardens under this Article. However, Excavations deeper than 12 inches are subject to the Permit requirements of Section 9 of this Article. Sec. 5. Right to Occupv Rights-of- Wav: Pavment of Fees. Subd. 1. Any Person required to register under Section 3, which occupies, uses, or places its Equipment in the Right-of-Way, is hereby granted a right to do so if and only so long as it (1) timely pays all fees as provided herein and (2) complies with all other requirements of law. Subd. 2. The grant of right in Section 5 is expressly conditioned on, and is subject to, the police powers of the City, continuing compliance with all provisions of law now or hereinafter enacted, including this Article as it may be from time to time amended and, further, is specifically subject to the obIigation to obtain any and all additional required authorizations, whether from the City or other body or authority. Sec. 6. Franchise: Franchise Supremacv. The City may, in addition to the requirements of this Article, require any Person which has or seeks to have Equipment located in any Right-of-Way to obtain a franchise to the full extent permitted by Iaw, now or hereinafter enacted. The terms of any franchise which are in direct conflict with any provisions of this Article, whether granted prior or subsequent to enactment to this Article (excluding the City's police powers which shall always be reserved to the City), shall control and supersede the conflicting terms of this Article provided, however, that requirements reIating to insurance, bonds, penalties, security funds, letters of credit, indemnification or any other security in favor of the City may be cumulative in the sole determination of the City or unIess otherwise negotiated by the City and the franchise grantee. All other City or unIess otherwise negotiated by the City and the franchise grantee. All other terms of this Article shall be fully applicable to all Persons whether franchised or not. Sec. 7. Registration Information. 5 Subd. 1. The information provided to the City at the time of registration shall include, but not be limited to: (a) The Registrant's name, Gopher One-Call registration certificate number, address and e-mail address if applicable, and telephone and facsimile numbers. (b) The name, address and e-mail address, if applicable, and telephone and facsimile numbers of a Local Representative. The Local Representative or designee shall be available at all times. Current information regarding how to contact the LocaI Representative in an Emergency shall be provided at the time of registration. (c) A certificate of insurance or self-insurance: (1) Shall be on a form approved by the City, (2) Shall verify that an insurance policy has been issued to the Registrant by an insurance company licensed to do business in the State of Minnesota; or is covered by self-insurance which the City determines to provide the City with protections equivalent to that of a Minnesota licensed insurance company, legally independent from Registrant. . I (3) Shall verify that the Registrant is insured against claims for personal injury, including death, as well as claims for property damage arising out of the (i) use and occupancy of the Right-of- Way by the Registrant, its officers, agents, empIoyees and Permittees, and (ii) placement and use of Equipment in the Right- of-Way by the Registrant, its officers, agents, employees and Permittees, including, but not limited to, protection against liability arising from completed operations, damage of underground Equipment and collapse of property, (4) Shall name the City as an additional insured as to whom the coverages required herein are in force and applicable and for whom defense will be provided as to all such coverages, (5) Shall require that the City be notified thirty (30) days in advance of cancellation of the policy, and (6) Shall indicate comprehensive liability coverage, automobile liability coverage, workers compensation and umbrella coverage in amounts established by the City of the office of risk and employee ; 6 benefit management in amounts sufficient to protect the City and carry out the purposes and policies of this Article. (d) If the Registrant is a corporation, a copy of the certificate required to be fiIed under Minn. Stat. ~ 300.06 (1996) as recorded and certified to by the Secretary of State. (e) A copy of the Registrant's certificate of authority from the Minnesota Public Utilities Commission, where the Registrant is lawfully required to have such certificate from said Commission. (f) Such other information as the City may require. Subd. 2. The Registrant shall keep all ofthe information listed above current at all times by providing to the City information of changes within fifteen (15) days following the date on which the Registrant has knowledge of any change. Sec. 8. Reoorting Obligations. Subd. 1. Ooerations. Each Registrant shall, at the time of registration and by December 1 of each year, file a construction and major maintenance pIan with the City. Registrants must use commercially reasonable efforts to anticipate and plan for all upcoming projects and include all such projects in a construction or major maintenance pIan. Such plan shall be submitted using a format designated by the City and shall contain the information determined by the City to be necessary to faciIitate the coordination and reduction in the frequency of Excavations and Obstructions of Rights- of- Way. The plan shall include, but not be limited to, the following information: (1) the specific locations and the estimated beginning and ending dates of all Projects to be commenced during the next calendar year (in this Section, a "Next-year Project"); and (2) the tentative locations and beginning and ending dates for all Projects contempIated for the five years following the next caIendar year (in this Section, a "Five-year Project"). The term "Project" in this Section shall include both next-year Projects and Five-year Projects. / By January 1 of each year the City will have available for inspection in its offices a composite list of all Projects of which it has been informed in the annuaI plans. All Registrants are responsibIe for keeping themseIves apprised of the current status of this list. 7 Thereafter, by February 1, each Registrant may change any Project in its list of Next-year Projects, and must notify the City and all other Registrants of all such changes in said list. Notwithstanding the foregoing, a Registrant may at any time join in a Next-year Project of another Registrant that was listed by the other Registrant. Subd. 2. Additional Next-vear Projects. Notwithstanding the foregoing, the City may, for good cause shown, allow a Registrant to submit additional Next-year Projects. Good cause includes, but is not limited to, the criteria set forth in Section 30.37, Subd. 3 concerning the discretionary issuance of Permits. Sec. 9. Permit Requirement. Except as otherwise provided for in this Code, no Person may Obstruct or Excavate any Right-of-Way without first having obtained the appropriate Right-of-Way Permit from the City to do so. (a) Excavation Permit. An Excavation Permit is required to allow the holder to Excavate that part of the Right-of-Way described in such Permit and/or to hinder free and open passage over the specified portion of the Right-of- Way by placing Equipment described therein, to the extent and for the duration specified therein. J (b) Obstruction Permit. An Obstruction Permit is required to allow the holder to hinder free and pen passage over the specified portion of Right- of- Way by placing Equipment, vehicles, or other obstructions described therein on the Right-of-Way for the duration specified therein. No Person may Excavate or Obstruct the Right-of-Way beyond the date or dates specified in the Permit unless such person (i) a new Permit or Permit extension is granted. Permits issued under this Article shall be conspicuously dispIayed at all times at the indicated work site and shall be availabIe for inspection by the City Inspector and authorized City personnel. Sec. 10. Permit Applications. Subd. 1. Application for a Permit is made to the City. Right-of-Way Permit applications shall contain, and will be considered complete only upon compliance with, the requirements of the following provisions: (a) Registration with the City pursuant to this Article. . I 8 (b) Submission of a completed Permit application form, including all required attachments, and scaled drawings showing the Iocation and area of the proposed project and the location of all existing and proposed Equipment. (c) Payment of all money due to the City for: (1) Permit fees and costs due; (2) prior Obstructions or Excavations; (3) any loss, damage, or expense suffered by the City as a result of AppIicant's prior Excavations or Obstructions ofthe Rights-of- Way of any Emergency actions taken by the City; and (4) franchise fees, if applicable. Subd. 2. When an Excavation Permit is requested for purposes of installing additional Equipment, and a Performance an Restoration Bond which is in existence is insufficient with respect to the additional Equipment in the sole determination ofthe City, the Permit applicant may be required by the City to post an additional Performance and Restoration Bond in accordance with Section 4, Subd. I. Sec. I I. Issuance of Permit: Conditions. , I Subd. 1. If the City determines that the Applicant has satisfied the requirements of this Article, the City may issue a Permit. Subd. 2. The City may impose any reasonable conditions upon the issuance of a Permit and the performance of the applicant thereunder in order to protect the public health, safety and welfare, to ensure the structuraI integrity of the Right-of-Way, to protect the property and safety of other users of the Right-of-Way, to minimize the disruption and inconvenience to the traveling public, and to otherwise efficiently manage use of the Right-of-Way. Sec. 12. Permit Fees. Subd. 1. Excavation Permit Fee. The Excavation Permit Fee shall be established by the City in an amount sufficient to recover the following costs: (1) the City Cost; (2) the Degradation of the Right-of-Way that will result from the Excavation; (3) Restoration, if done or caused to be done by the City. . I 9 Subd. 2. Obstruction Permit Fee. The Obstruction Permit Fee shall be established by the City and shall be in an amount sufficient to recover the City Cost. Subd. 3. Disruption Fees. The City may establish and impose a disruption fee as a penalty for unreasonable delays in Excavations, Obstrucitons, or Restoration. Disruption Fees will not be imposed if the delay in completion is due to circumstances beyond the control of the Applicant, including without limitation inclement weather, acts of God or civil strike. Subd. 4. Pavment of Permit Fees. No Excavation Permit or Obstruction Permit shall be issued without payment of all fees required prior to the issuance of such a Permit unless the AppIicant shall agree (in a manner, amount, and substance acceptable to the City) to pay such fees within thirty (30) days ofbiIIing therefor. All Permit fees shall be doubled during a probationary period. Permit fees that were paid for a Permit which was revoked for a breach are not refundable. Any refunded Permit Fees shall be less all City Cost up to and including the date of refund. Subd. 5. Use of Permit Fees. All Obstruction and Excavation Permit Fees shall be used solely for City management, construction, maintenance and Restoration costs of the Right -of- Way. Sec. 13. Right-of-Wav Restoration. Subd. 1. The work to be done under the Permit, and the Restoration and the Right- of-Way as required herein, must be completed within the dates specified in the Permit, increased by as many days as work could not be done because of circumstances constituting force majeure or when work was prohibited as unseasonal or unreasonable under Section 16, Subd. 2 all in the sole determination of the City. In addition to repairing its own work, the Permittee must restore the general area ofthe work, and the surrounding areas, including the paving and its foundations, to the same condition that existed before the commencement ofthe work and must inspect the area of the work and use reasonable care to maintain the same condition for thirty-six (36) months thereafter. Subd. 2. In its application for an Excavation Permit, the Permittee may choose to have the City restore the Right-of Way. In any event, the City may determine to perform the Right-of-Way Restoration and shall require the Permittee to pay a Restoration Fee to provide for reimbursement of all costs associated with such Restoration. In the event Permittee eIects not to perform Restoration, City may, in lieu of performing the Restoration itself, impose a fee to fully compensate for the resultant Degradation as well as for any and all additional City Costs associated therewith. Such fee for Degradation shall compensate the City for costs associated with a decrease in the useful life of the Right-of-Way caused by Excavation and shall include a Restoration Fee component. Payment of such fee does not relieve a Permittee from any Restoration obligation. It does not relieve Permittee from any Restoration Obligation, including but not limited to , / 10 replacing and compacting the subgrade base material and the excavation. The Restoration Fee will not include the cost to accomplish these responsibilities. (a) Citv Restoration. If the City restores the Right-of-Way, the Permittee shall pay the costs thereof within thirty (30) days of billing. If, during the thirty-six (36) months following such Restoration, the Right-of-Way settles due to permittee's Excavation or Restoration, the Permittee shall pay to the City, within thirty (30) days of billing, the cost of repairing said Right-of-Way. (b) Permittee Restoration. If the Permittee chooses at the time of application for an Excavation Permit to restore the Right-of-Way itseIf, such Permittee shall post an additional performance and Restoration Bond in an amount determined by the City to be sufficient to cover the cost of restoring the Right-of-Way to its pre-Excavation condition. If, twenty-four (24) months after completion ofthe Restoration of the Right-of-Way, the City determines that the Right-of-Way has been properIy restored, the surety on the Performance and Restoration Bond posted pursuant to this Subd. 2(b) shall be reIeased. I Subd. 3. The Permittee shall perform the work according to the standards and with the materials specified by the City and in compliance with Minnesota Rule 7819.1100. The City shall have the authority to prescribe the manner and extent to the Restoration, and may do so in written procedures of generaI application or on a case-by-case basis. The City, in exercising this authority, shall be guided but not limited by the following standards and considerations: (a) the number, size, depth and duration of the Excavations, disruptions or damage to the Right-of-Way; (b) the traffic volume carried by the Right-of-Way; the character of the neighborhood surrounding the Right-of-Way; (c) the pre-excavation condition of the Right-of-Way; the remaining life expectancy of the Right-of-Way affected by the Excavation; (d) whether the relative cost of the method of Restoration to the Permittee is in reasonable balance with the prevention of an acceIerated depreciation of the Right-of-Way that would otherwise result from the Excavation, disturbance or damage to the Right-of-Way; and (e) the likelihood that the particular method of Restoration would be effective in slowing the depreciation of the Right-of-Way that would otherwise take place. 11 I Notwithstanding the foregoing, the maximum limits of Restoration Methods and area requirements the City will impose are found in PUC PIates I to 13, shown in parts 7819.9900 to 7819.9950. Subd. 4. By choosing to restore the Right-of-Way itself, the Permittee guarantees its work and shall maintain it for twenty-four (24) months following its completion. During this twenty-four month period it shall, upon notification from the City, correct all Restoration work to the extent necessary, using the method required by the City. Said work shall be completed within five (5) calendar days of the receipt of the notice from the City, not including days during which work cannot be done because of circumstances constituting force majeure or days when work is prohibited as unseasonal or unreasonable under Section 16, Subd. 2 all in the sole determination of the City. Subd. S. If the Permittee fails to restore the Right-of-Way in the manner and to the condition required by the City, or fails to satisfactorily and timely compIete all repairs required by the City, the City at its option may perform or cause to be performed such work. In that event the Permittee shall pay to the City, within thirty (30) days of billing, the cost of restoring the Right-of-Way. JfPermittee fails to pay as required, the City may exercise its rights under the Performance and Restoration Bond. Sec. 14. Joint Applications. / Subd. 1. Registrants may jointly make application for permits to Excavate or Obstruct the Right-of-Way at the same place and time. - , Subd. 2. Registrants who join in and during a scheduled Obstruction or Excavation performed by the City, whether or not it is ajoint application by two or more Registrants or a single application, are not required to pay the Obstruction and Degradation portions of the permit Fee. Subd. 3. Registrants who apply for Permits for the same Obstruction or Excavation, which is not performed by the City, may share in the payment of the Obstruction or Excavation Permit Fee. Registrants must agree among themselves as to the portion each will pay and indicate the same on their appIications. Sec. 15. Supplementary Applications. Subd. 1. A Right-of-Way Permit is valid only for the area of the Right-of-Way specified in the Permit. No Permittee may perform any work outside the area specified in the Permit, except as provided herein. Any Permittee which determines that an area greater than that specified in the Permit must be Obstructed or Excavated must before working in that greater area (1) make application for a permit extension and pay any additional fees necessitated thereby, and (ii) be granted a new Permit or Permit extension. 12 / Subd. 2. A Right-of-Way Permit is valid only for the dates specified in the permit. No Permittee may begin its work before the Permit start date or, except as provided herein, continue working after the end date. If a Permittee does not finish the work by the Permit end date, it must make application for a new Permit for the additional time it needs, and receive the new Permit or an extension of the old Permit before working after the end date of the previous Permit. This Supplementary Application must be done before the Permit end date. Sec. 16. Other ObIigations. Subd. 1. Obtaining a Right-of-Way Permit does not reIieve Permittee of its duty to obtain all other necessary Permits, licenses, franchises or other authorizations and to pay all fees required by the City, any other city, County, State or Federal ruIes, Iaws or regulations. A Permittee shall comply with all requirements of local, state and federaI laws, including Minn. Stat. ~~ 2l6D.Ol-09 ("One Call Excavation Notice System"). A permittee shall perform all work in conformance with all appIicable codes and established rules and regulations, and is responsible for all work done in the Right-of-Way pursuant to its Permit, regardless of who performs the work. Subd. 2. Except in the case of an Emergency, and with the approvaI of the City, no Right-of-Way Obstruction or Excavation may be performed when seasonally prohibited or when conditions are unreasonable for such work. , I Subd. 3. A Permittee shall not so Obstruct a Right-of-Way that the natural free and clear passage of water through the gutters or other waterways shall be interfered with. Private vehicles may not be parked with or adjacent to a Permit area. The loading or unIoading of trucks adjacent to a Permit area is prohibited unless specifically authorized by the Permit. Sec. 17. Denial of Permit. The City may, in accordance with Minn. Stat. ~ 237.163, Subd. 4, deny any application for a Permit as provided in this Section. Subd. 1. Mandatory Denial. Except in the case of an Emergency, no Right-of-Way Permit will be granted: (a) To any Person required by Section 3 to be registered who has not done so; (b) To any Person required by Section 8 to file an annual report but has failed to do so; (c) For any Next-year Project not listed in the construction and major maintenance plan required under Section 8 unless the Person used commercially reasonable efforts to anticipate and plan for the project; .... 13 J (d) For any project which requires the Excavation of any portion of a Right- of-Way which was constructed or reconstructed within the preceding five (5) years. (e) To any Person who has failed within the past three (3) years to comply, or is presently not in full compliance, with the requirements ofthis Article; (f) To any Person as to whom there exists grounds for the revocation of a Permit under Section 22; and (g) If, in the sole discretion of the City, the issuance of a Permit for the particular date and/or time would cause a conflict or interfere with an exhibition, celebration, festival, or any other event. The City, in exercising this discretion, shall be guided by the safety and convenience of ordinary travel of the public over the Right-of-Way, and by considerations relating to the public health, safety and welfare. , Subd. 2. Permissive Denial. The City may deny a Permit in order to protect the public health, safety and welfare, to protect interference with the safety and convenience of ordinary travel over the Right-of-Way, or when necessary to protect the Right-of-Way and its users. The City may consider one or more ofthe following factors: (a) the extent to which Right-of-Way space where the Permit is sought is available; (b) the competing demands for the particular space in the Right-of-Way; (c) the availability of other locations in the Right-of-Way or in other Rights- of- Way for the Equipment of the Permit Applicant; (d) the applicability of ordinance or other regulations of the Right-of-Way that affect location of Equipment in the Right-of-Way; (e) the degree of compliance of the Applicant with the terms and conditions of its franchise; if any, this Article, and other applicable ordinances and regulations; (f) the degree of disruption to surrounding communities and businesses that will result from the use of that part of the Right-of-Way; (g) the condition and age ofthe Right-of-Way, and whether and when it is scheduled for total or partial reconstruction; and , , 14 (h) the balancing of the costs of disruption to the public and damage to the Right-of-Way, against the benefits to that part ofthe public served by the expansion into additional parts of the Right-of-Way. J Subd. 3. Discretionarv Issuance. Notwithstanding the provisions of Section 17, Subd. 1 (c), and (d) above, the City may issue a Permit in any case where the Permit is necessary (a) to prevent substantial economic hardship to a customer of the Permit Applicant, or (b) to allow such customer to materially improve its Utility Service, or (c) to allow a new economic development project; and where the Permit Applicant did not have knowledge of the hardship, the plans for improvement of Service, or the development project when said Applicant was required to submit its list of Next-year Projects. Subd. 4. Permits for Additional Next-vear Projects. Notwithstanding the provisions of Section 17, Subd. 1 (c) above, the City may issue a Permit to a Registrant who was allowed under Section IS, Subd. 2 to submit an additional Next-year Project, or in the event the Registrant demonstrates that it used commercially reasonable efforts to anticipate and plan for the project, such Permit to be subject to all other conditions and requirements of law, including such conditions as may be imposed under Section 11, Subd. 2. Sec. IS. Installation Requirements. , I In accordance with Minn. Stat. SS 237.162, Subd. 8(3); 237.163, Subd. S; and the Commission Rules, all work performed in the Right-of-Way shall be done in conformance with the "Standard Specifications for Street openings" as promulgated by the City and at a location as may be required by Section 25, Subd. 2. The City may enforce local standards pursuant to its inherent and historical police power authority, so long as such standards do not impose greater requirements than those found in the Commission Rules. Sec. 19. Inspection. Subd. 1. When the work under any Permit hereunder is completed, the Permittee shall notify the City. Subd. 2. Permittee shall make the work-site available to the City Inspector and to all others as authorized by law for inspection at all reasonable times during the execution and upon completion of work. . I Subd. 3. At the time of inspection the City Inspector may order the immediate cessation of any work which poses a serious threat to the life, health, safety or well-being ofthe public. The City Inspector may issue an order to the Registrant for any work which does not conform to the applicable standards, conditions or codes. The order shall state that failure to correct the violation will be cause for revocation of the Permit. Within ten 15 I (10) days after issuance of the order, the Registrant shall present proof to the City that the violation has been corrected. If such proof has not been presented within the required time, the City may revoke the Permit pursuant to Section 22. \ Sec. 20. Work Done Without a Permit. Subd. 1. Emergencv Situations. Each registrant shall immediately notify the City or the City's designee of any event regarding its Equipment which it considers to be an Emergency. The Registrant may proceed to take whatever actions are necessary in order to respond to the Emergency. Within two (2) business days after the occurrence of the Emergency, the Registrant shall apply for the necessary Permits, pay the fees associated therewith and fulfill the rest of the requirements necessary to bring itself into compliance with this Article for the actions it took in response to the Emergency. In the event that the City becomes aware of an Emergency regarding a Registrant's Equipment, the City may attempt to contact the Local Representative of each Registrant affected, or potentially affected, by the Emergency. In any event, the City may take whatever action it deems necessary in order to respond to the emergency, the cost of which shall be borne by the Registrant whose Equipment occasioned the Emergency. Subd. 2. Non-Emergencv Situations. ) Except in the case of an Emergency, any Person who, without first having obtained the necessary Permit, Obstructs or Evacuate a Right-of-Way must subsequently obtain a Permit, pay double the normal fee for said Permit, pay double all the other fees required by City ordinance, including, but not limited to, criminal fines and penalties, deposit with the City the fees necessary to correct any damage to the Right-of-Way and comply with all of the requirements of this Article. Sec. 21. Supplementarv Notification. If the Obstruction or Evacuation of the Right-of-Way begins later or ends sooner than the date given on the Permit, Permittee shall notify the City of the accurate information as soon as this information is known. Sec. 22. Revocation of Permits. . / Subd. 1. Registrants hold Permits issued pursuant to this Code as a privilege and not as a right. The City reserves its right, as provided herein and in accordance with Minn. Stat. S 237.163, Subd. 4, to revoke any Right-of-Way Permit, without fee refund, in the event of a substantial breach of the terms and conditions of any statute, ordinance, rule or regulation, or any condition of the Permit. A substantial breach by Permittee shall include, but shall not be limited to, the following: 16 "\ / (a) The violation of any material provision ofthe Right-of-Way Permit; (b) An evasion or attempt to evade any material provision of the Right-of- Way Permit, or the perpetration or attempt to perpetrate any fraud or deceit upon the City or its citizens; (c) Any material misrepresentation offact in the application for a Right-of- Way Permit; (d) The failure to maintain the required bonds and/or insurance; (e) The failure to complete the work in a timely manner; or (f) The failure to correct a condition indicated on an order issued pursuant to Section 19, Subd. 3. / Subd. 2. If the City determines that the Permittee has committed a substantial breach of a term or condition of any statute, ordinance, rule, regulation or any condition of the Permit, the City shall make a written demand upon the Permittee to remedy such violation. The demand shall state that continued violations may be cause for revocation of the Permit. Further, a substantial breach, as stated above, will allow the City, at the City's discretion, to place additional or revised conditions on the Permit. Subd. 3. Within twenty-four (24) hours of receiving notification ofthe breach, Permittee shall contact the City with a plan, acceptable to the City Inspector, for its correction. Permittee's failure to so contact the City Inspector, the Permittee's failure to submit an acceptable plan, or the Permittee's failure to reasonable implement the approved plan shall be cause for immediate revocation of the Permit. Further, Permittee's failure to so contact the City Inspector, or the Permittee's failure to submit an acceptable plan, or Permittee's failure to reasonably implement the approved plan shall automatically place the Permittee on Probation for one (1) full year. Subd. 4. From time to time, the City may establish a list of conditions of the Permit which, if breach, will automatically place the Permittee on Probation for one (1) full year, such as, but not limited to, working out of the allotted time period or working on Right- of-Way outside ofthe Permit. Subd. 5. If a Permittee, while on Probation, commits a breach as outlined above, Permittee's Permit will automatically be revoked and Permittee will not be allowed further permits for one (1) full year, except for Emergency repairs. / Subd. 6. If a permit is revoked, the Permittee shall also reimburse the City for the City's reasonable costs, including Restoration costs and the costs of collection and reasonable attorneys' fees incurred in connection with such revocation. 17 Sec. 23. Appeals. . / Subd. 1. A Person that: (a) has been denied Registration (b) has been denied a Right-of-Way Permit; (c) has had its Right-of-Way Permit revoked; or (d) believes that the fees imposed on the user by the City do not conform to the requirements of law, may have the denial, revocation, or fee imposition reviewed, upon written request, by the City Council. The City Council shall act on a timely written request at its next regularly scheduled meeting. A decision by the City Council affirming the denial, revocation, or fee imposition must be in writing and supported by written findings establishing the reasonableness ofthe decision. ) Subd. 2. Upon affirmation by the City Council of the denial, revocation, or fee imposition, the Right-of-Way user shall have the right to have the matter resolved by binding arbitration. Binding arbitration must be before an arbitrator agreed to by both the City and the Person. If the parties cannot agree on an arbitrator, the matter must be resolved by a three-person arbitration panel made up of one arbitrator selected by the City, one arbitrator selected by the Person, and one arbitrator selected by the other two arbitrators. The costs and fees of a single arbitrator shall be borne equally by the city and the Person. In the event there is a third arbitrator, each party shall bear the expense of its own arbitrator and shall jointly and equally bear with the other party the expense of the third arbitrator and of the arbitration. Subd. 3. Each party to the arbitration shall pay its own costs, disbursements, and attorney fees. Sec. 24. Mapping Data. Subd. 1. Except as provided in Subd. 2 of this Section, each Registrant shall provide as a part of its Permit Applicant the following information: (a) Location and approximate depth of Applicant's mains, cables, conduits, switches, and related equipment and facilities with the location based on: (i) offsets from the property lines, distances from the centerline to the public Right-of-Way, and curb lines as determined by the City. J 18 (ii) Coordinates derived from the coordinates system being used by the City or / (iii) Any other system agreed upon by the Applicant and the City. (b) Type and size of the utility facility. (c) Description showing above ground appurtenances. (d) A legend explaining symbols, characters, abbreviations, scale and other data shown on the map; and (e) Any facilities to be abandoned, if applicable, in conformance with Minn. Stat. S 216D.04, Subd. 3. The Applicant shall provide the City information Mapping Data shall be provided with specificity and in the format requested by the City for inclusion in the mapping system used by the City. If such format is different from what is currently utilized and maintained by the Registration, the Registrant may provide such information in the format that they currently are utilizing. The Permit application fee may include the cost to convert the data furnished by the Applicant to a format currently in use by the City. Subd. 2. Information regarding Equipment of Telecommunications Right-of-Way Users constructed or located prior to May 10, 1997, need only be supplied in the form maintained, however, all Telecommunications Right-of-Way Users must submit some type of documentary evidence regarding the location of Equipment within the Rights-of- Way of the City. Subd. 3. At the request of any Registrant, any information requested by the City, which qualifies as a "trade-secret" under Minn. Stat. S 13.37 (b) shall be treated as trade secret information as detailed therein. With respect to the provision of Mapping Data, the City may consider unique circumstances from time to time required to obtain mapping Data. Sec. 25. Location of Equipment. Subd. 1. Undergrounding. Unless otherwise permitted by an existing franchise or Minnesota statue 216B.34, or unless existing above-ground Equipment is repaired or replaced, or unless infeasible such as in the provision of electric service at certain voltages, new construction, the installation of new Equipment, and the replacement of old Equipment shall be done underground or contained within buildings or other structures in conformity with applicable codes unless otherwise agreed to by the City in writing, and such agreement is reflected in applicable Permits. 19 / Subd. 2. High Densitv Corridor. The City may assign specific high density corridors within the Right-of-Way or any particular segment therefore as may be necessary for each type of equipment that is or, pursuant to current technology, the City expects will someday be located within the Right-of-Way, Excavation, Obstruction, or other Permits issued by the city involving the installation or replacement of Equipment may designate the proper corridor for the equipment at issue and such Equipment must be located accordingly. In the event the City desires to establish a high density corridor, it shall include the elements required in Commission Rule 781.90200. Any Registrant who Equipment is located prior to enactment of this Article in the Right- of-Way in a position at variance with the corridors established by the City shall, no later than at the time of the next reconstruction or Excavation ofthe area where its Equipment is located, move that Equipment to its assigned position within the Right-of-Way, unless this requirement is waived by the City for good cause shown, upon consideration of such factors as the remaining economic life of the facilities, public safety, customer service needs and hardship to the Registrant. Subd. 3. Nuisance. One year after the passage ofthis ordinance, any equipment found in a Right-of-Way that has not been registered shall be deemed to be a nuisance. The City may exercise any remedies or rights it has at law or in equity, including, but not limited to, abating the nuisance or taking possession of the Equipment and restoring the Right-of-Way to a useable condition. Subd. 4. Limitation of Space. To protect health, safety and welfare, the City shall have the power to prohibit or limit the placement of new or additional Equipment within the Right-of-Way ifthere is insufficient space to accommodate all of the requests of Registrants or Persons to occupy and use the Right-of-Way. In making such decisions, the City shall strive to the extent possible to accommodate all existing and potential users of the Right-of-Way, but shall be guided primarily by considerations of the public interest, the public's needs for the particular Service, the condition of the Right-of-Way, the time of year with respect to essential utilities, the protection of existing Equipment in the Right-of-Way, and future City plans for public improvements and development projects which have been determined to be in the public interest. Sec. 26. Relocation of Equipment. J The Person must promptly and at its own expense, with due regard for seasonal working conditions, permanently remove and relocate its Equipment and facilities in the Right-of- Way whenever the City requests such removal and relocation, and shall restore the Right- of- Way to the same condition it was in prior to said removal or relocation. The City may take such requests in order to prevent interference by the Company's Equipment or facilities with (i) a present or future City use of the Right-of-Way for a public project, (ii) the public health or safety; (iii) the safety and convenience or travel over the Right-of- Way. 20 Sec. 27. Pre-Excavation Equipment Location. In addition to complying with the requirements of Minn. Stat. S S 216D..OI-09 ("One Call Excavation Notice System") before the start date of any Right-of-Way Excavation, each Registrant who has Equipment located in the area to be Excavated shall mark the horizontal and approximate vertical placement of all said Equipment. Any Registrant whose Equipment is less than twenty (20) inches below a concrete or asphalt surface shall notify and work closely with the Excavation contractor in an effort to establish the exact location of its Equipment and the best procedures for Excavation. Sec. 28. Damage to Other Equipment. When the City does work in the Right-of-Way and finds it necessary to maintain, support or move a Registrant's facilities to protect it, the City shall notify the Local Representative as early as is reasonably possible. The costs associated therewith will be billed to the Registrant and must be paid within thirty (30) days from the date of billing. Each Registrant shall be responsible for the cost of repairing any facilities in the Right-of- Way which it or its facilities damages. Each Registrant shall be responsible for the cost or repairing any damage to the facilities of another Registrant caused during the City's response to an Emergency occasioned by the Registrant's facilities. Sec. 29. Right-of-Wav Vacation. Subd. 1. If the City vacates a Right-of-Way which contains the facilities of a Registrant, the registrant's rights in the vacated right-of-way are governed by Minnesota Rules 7819.3200. Subd. 2. If the vacation requires the relocation of Registrant or Permittee Equipment and: (a) if the vacation proceedings are initiated by the Registrant or Permittee, the Registrant of Permittee must pay the relocation costs; or (b) if the vacation proceedings are initiated by a Person or Persons other than the Registrant or Permittee, such other Person or Persons must pay the relocation costs. Sec. 30. Indemnification and Liabilitv. Subd. 1. By reason ofthe acceptance of a registration or the grant of a Right-of- Way Permit, the City does not assume any liability: (a) for injuries to Persons, damage to property, or loss of Service claims by parties other than the Registrant or the City; or (b) for claims or penalties or any sort resulting from the installation, presence, maintenance, or operation of Equipment by Registrants or activities of Registrants. J Subd. 2. By registering with the City, or by accepting a Permit under this Ordinance, a Registrant or Permittee agrees to defend and indemnify the City in accordance with the provisions of Minnesota Rules 7819.1250. 21 Sec. 31. Future Uses. / In placing any Equipment, or allowing it to be placed, in the Right-of-Way the City is not liable for any damages caused thereby to any Registrant's Equipment which is already in place. No Registrant is entitled to rely on the provisions of this Article, and no special duty is created as to any Registrant. This Article is enacted to protect the general health, welfare and safety of the public at large. Sec. 32. Abandoned and Unusable Equipment. Subd. 1. A Registrant who has determined to discontinue its operations with respect to any Equipment in any Right-of-Way, or segment or portion thereof, in the City must either. (a) Provide information satisfactory to the City that the Registrant's obligations for its Equipment in the Right-of-Way under this Article have been lawfully assumed by another Registrant; or (b) Submit to the City a proposal and instruments for transferring ownership of its Equipment to the City. If a Registrant proceeds under this clause, the City may, at its option: . / (1) purchase the Equipment, or (2) require the Registrant, at its own expense, to remove it, or (3) require the Registrant to post an additional bond or an increased bond amount sufficient to reimburse the City of reasonably anticipated costs to be incurred in removing the Equipment. Subd. 2. Equipment of a Registrant which fails to comply with the preceding paragraph and which, for two (2) years, remains unused shall be deemed to be abandoned. Abandoned Equipment is deemed to be a nuisance. The City may exercise any remedies or rights it has at law or in equity, including, but not limited to, (i) abating the nuisance, (ii) taking possession of the Equipment and restoring it to a useable condition, (iii) requiring removal of the Equipment by the Registrant or by the Registrant's surety; or (iv) exercising its rights pursuant to the Performance and Restoration Bond. Subd. 3. Any Registrant who has unusable Equipment in any Right-of-Way shall remove it from the Right-of-Way during the next scheduled Excavation, unless this requirement is waived by the City. , , / 22 Sec. 33. Reservation of Regulatorv and Police Powers. / The City by the granting of a Right-of-Way Permit, or by registering, a Person under this Article does not surrender or to any extent lose, waive, impair, or lessen the lawful powers and rights, which it has now or may be hereafter vested in the City under Construction and statutes of the State of Minnesota or the Charter of the City to regulate the use of the Right-of-Way by the Permittee; and the Permittee by its acceptance of a Right-of-Way Permit or of registration under those ordinances agrees that all lawful powers and rights, regulatory power, or police power, or otherwise as are or the same may be from time to time vested in or reserved to the City, shall be in full force and effect and subject to the exercise thereof by the City at any time. A Permittee or Registrant is deemed to acknowledge that its rights are subject to the regulatory and police powers of the City to adopt and enforce general ordinances necessary to the safety and welfare of the public deemed to agree to comply with all applicable generallaws and ordinances enacted by the City pursuant to such powers. Any conflict between the provisions of a registration or of a Right-of-Way Permit and any other present or future exercise of the City's regulatory or police powers shall be resolved in favor ofthe latter. Sec. 34. Severability. If any Section, subsection, sentence, clause, phrase, or portion of this Article is for any reason held invalid or unconstitutional by any court or administrative agency of competent jurisdiction, such portion shall be deemed a separate, distinct, and independent provision and such holding shall not affect the validity of the remaining portions thereof. If a regulatory body or a court of competent jurisdiction should determine by a final, non- appealable order that any Permit, right or registration issued under this Article or any portion ofthis Article is illegal or unenforceable, then any such Permit, right or registration granted or deemed to exist thereunder shall be considered as a revocable Permit with a mutual right in either party to terminate without cause upon giving sixty (60) days written notice to the other. The requirements and conditions of such a revocable Permit shall be the same requirements and conditions as set forth in the Permit, right or registration, respectively, except for conditions relating to the term ofthe Permit and the right of termination. If a Permit, right or registration shall be considered a revocable permit as provided herein, the Permittee must acknowledge the authority ofthe City Council to issue such revocable permit and the power to revoke it. Nothing in this Article precludes the City from requiring a franchise agreement with the Applicant, as allowed by law, in addition to requirements set forth herein. Sec. 35. Non-Exclusive Remedv. " The remedies provided in this Article and other Articles in the City Code are not exclusive or in lieu of other rights and remedies that the City may have at law or in equity. The City is hereby authorized to seek legal and equitable relieffor actual or 23 " threatened injury to the public Right-of-Way, including damages to the Rights-of-Way, whether or not caused by a violation of any of the provisions of this Article or other provisions of the City. Sec. 36. Effective Date. This ordinance shall become effective January 1,2000. Adopted by the City Council on this day of ,1999. ATTEST: CITY OF ANDOVER: J.E. McKelvey, Mayor Victoria V olk, City Clerk 24 '.. CITY OF ANDOVER REQUEST FOR PLANNING COMMISSION ACTIoN August 10, 1999 DATE AGENDA ITEM ORIGINATING DEPARTMENT APPROVED FOR AGENDA 3. Public Hearinl!: Ordinance No. 247 Right-of-Way Management Planning Jeff Johnson BY: BY: Request 1 The Planning and Zoning Commission is asked to hold a public hearing to review and discuss the attached ordinance for the City to manage its public rights-of-way and recover its rights-of-way management costs. At the March 16, 1999 City Council meeting, Council directed the Commission to hold a public hearing on the ordinance. This ordinance was drafted by the City Attorney (William Hawkins) for your review and comment and is similar to the model ordinance from the League of Minnesota Cities. Please review and comment. Attachments An Ordinance Providing for Public Right-of-Way Management City Council Meeting Minutes - 3/16/99 Notice of Public Hearing , T to .IC .1e .1e .ar as 1d 1d , Jr, / ld )f- he fr. :ry 'ss :d, III Jf- ed , it lte of de n' , , / , . I / Regular Andover Planning and Zoning Commission J\1eeting Alinutes - August J 0, J 999 Page 3 developments projects. He stated this matter should be investigated to be certain these businesses are not included by default. Chairperson Squires stated this was a good point. He stated Page 4, Section 4, Subdivision 2 indicates ''No person shall construct, install, repair, remove, or relocate or perform any other work on, or use any Equipment or any part thereoflocated in any Right-of-Way without first being registered with the City." He stated that this language was somewhat broad, and that he did not think an application to private property owners was the intent of the ordinance. He suggested staff request the City Attorney to review the language to insure it is not too broad. Motion by Falk, seconded by Dalien, to close the public hearing at 7:07 p.m. Motion carried on a 7 - ayes, 0 - nays, 0 - absent vote. Commissioner Apel stated the Commission could forward a recommendation of the ordinance, with the stipulation that the City Attorney review the language to insure that it does not interfere excessively with homeowner driveway construction or improvement, adding, if interpreted as written, it might be very restrictive. Motian by Ape1, seconded by Falk, to recommend to the City Council Approval of Ordinance No. 240, an Ordinance Providing For Public Right-of-Way Management, with the Request that the City Attorney and Staff Review the Issue of the Scope, to Assure it is Not Openly Broad, and Covers Private Land Owner Activities that It Was Not Intended To. Motion carried on a 7 - ayes, 0 - nays, 0 - absent vote. Mr. Johnson stated that this matter would come before the Council for consideration at the September 7, 1999 City Council meeting. DISCUSSION CONTINUED: ORDINANCE NO.8, ACCESSORY STRUCTURES, 4.21 FENCES AND 6.02 SETBACKS - DISCUSSION WILL FOCUS ON THE SETBACK REQUIREMENTS IN SIDEYARDS FROM STREETS ON CORNER LOTS. Zoning Administrator Johnson stated, at the July 27, 1999 Planning and Zoning Commission meeting, the COrnn1ission reviewed the setback requirements for structures and fences on comer lots. Mr. Johnson stated the Commission requested that staff contact neighboring communities to determine if they allow detached structures to encroach into the sideyard setback from the street on comer lots, and to see if structural uniformity is being met. He provided the Commission with the results of the research. Mr. Johnson stated staff had contacted the cities of Anoka. Blaine, Coon Rapids, Champlin and Ramsey. He stated four of these five communities do not allow any structural Regular Andover Planning and Zoning Commission ,\1eeting ,\of in utes - August J O. J 999 Page 2 PUBLIC HEARING: ORDINANCE NO. 247 - RIGHT-OF-WAY MANAGEMENT ORDINANCE. Zoning Administrator Johnson stated the Planning and Zoning Commission is requested to hold a public hearing to review and discuss the ordinance for the City to manage its public rights-of-way and recover its rights-of-way management costs. Mr. Johnson stated, at the March 16, 1999 City Council meeting, Council directed the Commission to hold a public hearing on the ordinance. This ordinance was drafted by the City Attorney (William Hawkins) for the Commission's review and comment and is similar to the model ordinance from the League of Minnesota Cities. Mr. Johnson noted the League of Minnesota Cities' Attorney, Thomas Campbell, has reviewed the document, and has indicated through correspondence that it is well written, and should address the City's needs. Mr. Johnson provided the Commission with a copy of the draft ordinance for their review and comment. ,ltfotion by Falk, seconded by Jovanovich, to open the public hearing at 7:04 p,m. Motion carried on a 7 - ayes, 0 - nays 0 - absent vote. Chairperson Squires stated this proposal was to adopt a right-of-way ordinance which would establish the terms and conditions for use, improvement and construction within the right-of- way. Mr. Johnson added the City Attorney and City Engineer would further review the ordinance, as many details required resolution. Chair Apel inquired if variance on utility lines had been addressed in the ordinance. Mr. Johnson stated they had, and if necessary, the City could require utility companies to bury their lines. Commissioner Dalien stated it appeared that the City was attempting to address telecommunication companies, public utility services and similar undertakings. He noted, however, some of the definitions could also be construed to apply to a homeowner who, in the process of constructing a new driveway, might find it necessary to excavate the right-of- way. He inquired if this situation would require an additional permit. Mr. Johnson stated that he was not certain this type of construction had been addressed, however, he agreed it was a consideration. Commissioner Dalien stated the terminology also appeared to indicate that people performing this type of work would be required to go through some type of process and to have a plan in place. He stated he was concerned this might include contractors who were in the business of constructing driveways and reconstruction in housing Regular .-Indover Ciry Council Jfeeting AIinlltes - Jlarch 16. 1999 Page 7 APPROVE ORDINANCE NO. 247/RIGHT-OF-WA Y MANAGEMENT ORDINANCE Councilmember Jacobson stated because of a potential conflict of interest, he would like to discuss this item but will not be voting on any motion. The Council agreed. Mr. Carlberg noted the proposed ordinance to administer and regulate the public right-of-way is similar to the City of Oakdale and the League of Minnesota Cities model right-of-way management ordinance. The ordinance relates to the burying of distribution lines in the City and would require the distribution lines along Bunker Lake Boulevard to be buried as a part of the reconstruction project. The ordinance is quite lengthy, so Staff has prepared another option relating only to the regulating of buried distribution lines in the City that the Council may wish to consider instead. Attorney Hawkins stated the City does have the authority to require the distribution lines to be buried underground based on the Court of Appeals ruling in the Northern States Power Company v. The City of Oak dale case. There are a lot of cities requiring underground distribution lines, and others are considering it. Councilmember Orttel noted the reason this is being considered is because the residents along Bunker Lake Boulevard, particularly those across from Andover Station, have requested those lines go underground. The incremental cost for that was estimated at 5106,000. Councilmember Jacobson understood that cost has been changed to over 5600,000. He stated the Quad Cities Cable TV has been looking at ordinances regulating cable television. and their attorney is extremely knowledgeable in those affairs. He noted if this ordinance is passed, it applies to all utilities. including gas, telephone and cable TV. Because of the affect this ordinance has on the other utilities as well as on the residents. he felt a public hearing should be held by the Planning and Zoning Commission for public input. The ordinance also allows the utilities to pass the cost of going underground to the residents. Just burying the transmission line along Bunker Lake Boulevard will add to everyone's monthly electric bill plus an administrative fee. Larry Peterson, Connexus Energy, stated there are two issues. One is putting the electric line underground with the Bunker Lake Boulevard reconstruction project. The other is approving a right- of-way ordinance. They have had experience dealing with the League of Minnesota Cities ordinance. The ordinance would apply to all services and could also have an impact on the City's utilities. He encouraged the Council to look at the ordinance by the Public Utilities Commission which clarifies many of the issues. He thought those guidelines will be available soon. Regarding the reconstruction of Bunker Lake Boulevard, they have met with Staff and have been planning that project for a long time. Their original quote to bury the transmission line assumed they would maintain the line that is already there. The change from $187,000 to in excess of $700,000 in incremental cost is because they have since learned from the county that they will not be able to maintain the existing underground line. That means they must bury two circuits, and he went into detail comparing what was originally proposed to what must now be done. Also, it was March 9 when they found out the City wanted to go with underground line when it had already agreed to go overhead. At this time. they may not even be able to get the cable in time to go underground during the project. Regular Andover City Council .tleeting ,\.Iinutes - JJarch 16, 1999 Page 8 (Ordinance No. 2-17/Right-of-Way lvlanagement Ordinance. Continued) Mr. Peterson stated the City does not need an ordinance to have the transmission line along Bunker Lake Boulevard buried. They ....ill bury the line if the City requests it, but the costs associated with that will have to be recouped from either the City or from the citizens of the City. They have charged the residents in other cities. The charge depends on the project. The City also has the option of financing the cost if it wishes to pay it directly. If the City makes the request to go underground, it would negotiate with the City on the cost recovery. The Council discussed the affect the ordinance would have on the City and the residents. They felt it is difficult to make a decision without knowing the financial impact on the residents to determine whether or not it is worth it to require underground utilities. The sentiment was it would be nice to bury the lines, but can the cost be justitied. There would need to be a policy on how the costs would be financed. The concern is the aggregate cost of these projects to the residents over time. Another problem is there is not a lot of time if the lines along Bunker Lake Boulevard are to be buried with the reconstruction project. " Larry Nelson, Connexus Energy, stated the line is not in the public right of way, and they will move it at no charge. In those places where the it is underneath the road, the county has informed them they ....ill not allow that to stay energized. They plan to abandon that and double circuit the overhead. If the Council decision is to go with overhead lines, they will assume the cost of the additional circuit. If the City had chosen to go underground, they would have done so at their cost as \\iell. They had their plans half done to go overhead when they received the letter from the City indicating a desire to consider burying the lines, so now they are looking at the entire incremental cost to be borne by the City of Andover. Mr. Nelson also noted the Public Utilities Commission is not ""Titing an ordinance but is writing guidelines as to what will or....i11 not work in an ordinance. There are a number of provisions in the League of Minnesota Cities ordinance that got thrO\'m out in the guidelines, so there may be a risk of having to redo the ordinance if one is adopted at this time. He suggested the City look at the guidelines before adopting an ordinance, Mr. Peterson stated the City of Coon Rapids developed an excise tax starting at three percent and has since raised it to five percent for underground utilities. There was opposition to the ordinance for underground utilities, and it was not enacted; so the tax is simply another form of fund raising for them. The City of Blaine passed a franchise fee, but there was so much opposition, that they changed it. Attorney Hawkins disagreed with Mr. Nelson's comments on the PUC guidelines, as he understood them to be rules. A number of communities feel they are going beyond their authority , and are involved in the position that the right of ways should be regulated through more local control. Mr. Peterson stated they are not governed by the PUC, so they mayor may not adhere to them. Councilmember Jacobson noted the costs would be spread among the residents only when existing \ Rl:gular ..Jndowr City Council J/el:ting A/inures - A/arch 16. 1999 Page 9 Ordinance No. 2-17/Right-of-Way J"'fanagement Ordinance. Continued) overhead lines are buried. Several Councilmembers agreed this proposal is far reaching and should be given a lot of thought. The Planning and Zoning Commission should be asked to look at it and hold public hearings. Mr. Nelson stated the two lines along Bunker Lake Boulevard are their main distribution lines and are quite large. Even if they are put underground, there will still be 10 to 12 of the big green switch boxes above ground. Their estimate is to bury the lines along the entire corridor of the Bunker Lake Boulevard reconstruction project. The Council noted the particular area of concern is along Andover Station to move the lines away from the residential area They asked ifit would be possible to move the overhead lines to the south side of Bunker Lake Boulevard in that area. Mr. Nelson estimated the cost to bury the line just along the Andover Station area would be double the original estimate of $186,000, depending on how it is financed. He didn't see a problem moving it to the south side in that vicinity. They are looking to move it on the north side west of Crosstown Boulevard to occupy the green space between the road and the trail. That ""ill reduce the amount of tree trimming they would need to do. \ Mr. Erickson stated he can determine if additional easement would be needed along Andover Station if the power lines were moved to the south side of Bunker Lake Boulevard in that vicinity. J't-/otion by Orttel. Seconded by Knight, that the Council direct the Planning Commission to hold a public hearing on the proposed ordinance to administer and regulate the public right of way in the public interest and have them review the Public Utilities Commission rules or recommendations that are in progress and to have a report back to the Council no later than mid-year. DISCUSSION: Mr. Carlberg stated the issue with the residents will be cost. He suggested the Council review the costs before making a decision to proceed with the ordinance. Councilmember Orttel suggested the power company should be able to get those numbers. They should be able to determine how much it would cost the residents per one million dollars worth of construction over a pay-back period of one, five or ten years. This would apply to reconstruction costs only. not new underground utilities. He also suggested talking to other cities who have or are in the process of enacting similar ordinances regarding the problems they have encountered and ideas on how to spread the costs. Councilmember Jacobson suggested reviewing the efforts of the cable company. Mr. Carlberg stated he would like to bring those costs relating to Bunker Lake Boulevard to the March 30 EDA meeting. The Council agreed. Motion carried on a 4- Yes. I-Present (Jacobson) vote. .r '. -:',~.",~/<,~~-:>:~.:~~...; CITY of ANDOvER I .,~'; ..- '."i" j.":;/~'-.',~-.:'" .~ ..~,. '- '~\'..:} :.~~, ~.: ,"' :.:~~ '-~ ::~{-~~-:'~':'~~..::.~f:: "~~ All written and verbal coinments will be received at that tlmearid location. ,A copy of the application will be available at theAndov~r City "Hall for review prior to said meeting. . " U:o 11~ Victoria V olk, City Clerk Publication dates: July 30, 1999 August 6, 1999 \ ) CITY OF ANDOVER REQUEST FOR COUNCIL ACTION / DATE: September 21. 1999 AGENDA SECTION ORIGINATING DEPARTMENT Discussion Planning Jeff Johnson ITEM NO. Approve Resolution Setting Fees Ordinance No. 247 - Right-of-Way Management Ordinance 6. Reauest The City Council is asked to review and approve the attached resolution which sets fees for the City to recover its right-of-way management costs. These fees are based on a fee structure obtained from the League of Minnesota Cities and the City of Fridley. These fees will have to be reviewed and adjusted each year (if necessary), Please review and comment. \ / J CITY OF ANDOVER COUNTY OF ANOKA STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION SETTING FEES EFFECTIVE JANUARY 1,2000 FOR THE CITY TO RECOVER ITS RIGHT-OF WAY MANAGEMENT COSTS. The City Council hereby resolves: Registration Fee $40.00 Excavation Permit Fee (Non-Emergency) Excavation Permit Fee (Emergency) $125.00 $50.00 Permit Extension Fee $25.00 / Delay Penalty (Up to 3 days late) (Each day late over 3 days) $60.00 Plus $10.00/Day Adopted by the City Council of the City of Andover on this _ day of 1999. ATTEST: CITY OF ANDOVER Victoria V olk, City Clerk J. E. McKelvey, Mayor , .~ RIGHT-OF-WAY FEES & CHARGES " Cost Estimates for Fees / 1. Rel!istration Fee Time X $Per = Cost Involved Hour ($) ffiour) Administration 0.25 X 40 = $ 10.00 Review 0.50 X 40 = 20.00 Recording 0.25 X 40 = 10.00 Total Cost $ 40.00 Proposed Fee = $ 40.00 2. J Excavation Permit Fees A) Hole Administration 0.25 X 40 = $ 10.00 Verification 1) Plan Review 0.50 X 45 = 22.50 2) Inspection , a) Location before work 0.50 X 30 = 15.00 / b) Compliance during work 0.50 X 30 15.00 = c) Completion after work 0.50 X 30 = 15.00 d) Reinspection 0.25 X 40 = 10.00 3) Testing Result Review a) Compaction 0.083 X 40 = 3.33 b) Material 0.083 X 40 = 3.33 4) Mapping a) Review data 0.25 X 45 = 11.25 b) Transfer to Autocad 0.25 X 45 = 11.25 c) Insert to overlay to tie in 0.25 X 45 = 11.25 Total Cost $127.91 Proposed Fee $125.00 B) Emergency Hole Administration 0.25 X 40 = $ 10.00 Inspection after completion 1.50 X 30 = 45.00 " Total Cost $55.00 J Proposed Fee $55.00 "\ / C) Trench Administration 0.25 X 40 = $ 10.00 Verification 1) Plan Review 1.50 X 45 = $ 67.50 2) Inspection a) Location before work 0.50 X 30 = 15.00 b) Compliance during work 1.50 X 30 = 45.00 c) Completion after work 1.50 X 30 = 45.00 d) Reinspection 0.75 X 40 = 30.00 3) Testing Result Review a) Compaction 0.083 X 40 = 3.33 b) Material 0.083 X 40 = 3.33 4) Mapping a) Review data 0.50 X 45 = 22.25 b) Transfer to Autocad 0.25 X 45 = 11.25 c) Insert to overlay to tie in 0.50 X 45 = 22.25 Total Cost $275.40 The average trench is 330L;: past the width of a hole. 'Therefore, the number of 100L;: (or portion thereof) units is 4. The cost per 100L;: unit is 275.40 / 4 = $68.85/100' unit. Proposed Fees = $ 70.00/l00L;: (Plus Hole Fee) 3. Obstruction Permit Fee A) Administration B) Recording C) Review 0.25 0.25 0.75 X 40 X 40 X. 45 = $ 10.00 = 10.00 = 33.75 $ 53.75 $ 50.00 Minimum Base Coat Proposed Base Fee Plus additional fee based on length , ) 2 \ Inspection 1) Compliance during work 2) Completion after 1.50 0.25 x X 30 30 = $ 45.00 = 7.50 = $ 52.50 = 0.0525 Additional fee on asswned 10001;: permit Additional cost per lineal foot = $52.50 11000 Proposed Fee = $50.00 Dlus 0.054: 4. Permit Extension Fee A) Administration 0.25 X 40 = $ 10.00 B) Recording 0.083 X 40 = 3.33 C) Review 1.0 X 40 = 40.00 Total Cost = $ 53.33 Proposed Fee = $ 55.00 \ 5. Delav Penaltv / A) Administration 1.5 X 40 = $ 60.00 For lip to 3 days of non-completion and non-prior notice before specified completion date. After 3 days, an additional charge of $ IOlday will be levied. Total Penalty Charge = $ 60.00 (Up to 3 days late) Each day late over 3 days = $ 60.00 Plus 10.00illav F:\COMMON\ADMIN\MISC-TOMlROW ) 3 Z>:'38tfd .!..8Z1 I.!..S Zl9 0p:pI 66. Sl d3S Ordinance No. 1116 . C I1Y ()F 1lt{I)~ Page 31 SECTION 407.30. RESERVATION OF REGULATORY AND POLICE POWERS A permittee's or Registrant's rights are subject to the regulatory and police powers of the City to adopt and enforce general ordinances necessary to protect the health, safety and welfare of the public. SECTION 407.31. SEVERABILITY If any section, subsection, sentence, clause, phrase, or portion of this Chapter is for any reason held invalid or unconstitutional by any court or administrative agency of competent jurisdiction, such portion shall be deemed a separate, distinct, and independent provision and such holding shall not affect the validity of the remaining portions thereof. If a regulatory body or a court of competent jurisdiotion should determine by a final, non-appealable order that any permit, right or registration issued under this Chapter or any portions of this Chapter is illegal or unenforceable, then any such permit, right or registration granted or deemed to exist hereunder shall be considered as a revocable permit with a mutual right in either party to terminate without cause upon giving sixty (60) days written notice to the other. The requirements and conditions of such a revocable permit shall be the same requirements and conditions as set forth in the permit, right or registration, respectively, except for conditions relating to the term of the permit and the right of termination. Nothing in this Chapter precludes the City from requiring a franchise agreement with the Applicant, as allowed by law, in addition to requirements set forth herein. SECTION 407.32 Any fees imposed under this chapter shall be reviewed and adopted at least annually at the same time and in the same manner as other fees established by the city. At any time, in its discretion, the City expressly reserves the right to review the fees imposed in this Chapter and, upon notice and public hearing, modify them if it is satisfied that such action is necessary to reflect the cost of regulating and supervising the activities governed by this chapter. CHAPTER 11, GENERAL PROVISIONS AND FEES Section 11.10 ~FeesH is amended to include the following: vA07.04 Registration Fee $22.50 ;j. ~407.07 Excavation Permit $200.00 I' ~~/Z~'d ~268SSL 0.1 ^3Ial~~ ~o ^l1J wo~~ Z0:S1 6661-SI-d3S .. ~~.3~tfd ~~ . d ltflOl l.sc:t tl.S c:t9 tp:pt 66, St d3S I Ordinance No. 1116 Page 32 V 407.07 Obstruction Permit $15.00 407.07 Permit Extension $15.00 407.07 Delay Penalty Permit extension fee plus $100.00 penalty 407.10 Mapping Fee $10 if data is not in City format and City GIS compatible 407.11 Degradation Cost Restoration cost per square foot for the area to be restored 407.05 User Fee (Residential, commercial or industrial) $10 per project PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 20n DAY OF APRIL, 1998. .... : NANCY J. JORGENSON - MAYOR ATTEST: WILLIAM A. CHAMPA - CITY CLERK Public Hearing: First Reading: Second Reading: publication: February 23, 1998 March 2, 1998 April 20, 1998 April 23, 1998 " ~~/~~'d ~Z68~~L O.L ^3Ial~~ ~o ^~I~ wo~~ ~0:~! 666!-~!-d3S CITY OF ANDOVER REQUEST FOR COUNCIL ACTION ~ DATE: SePtember 21. 1999 AGENDA SECTION ORIGINATING DEPARTMENT Discussion Community Development ITEM NO. Clo"d P " . . onSl er artlclpatlOn III Metropolitan Livable Communities Act Local Housing Incentives Program for 2000 David 1. Carlberg Community Development Director The City Council is requested to consider participating in the Metropolitan Livable Communities Act Housing Incentives Program for 2000. Attached is a letter from Thomas C. McElveen, Deputy Director, Community Development Division of the Metropolitan Council encouraging Andover's participation in the program. The benefit to the City in participating in the program allows the City potential access to a $15 million fund for maintaining or developing housing, clean up of polluted sites, etc. '. J If the City is to participate, the City would be required to contribute on an annual basis an "Affordable and Life-cycle Housing Opportunities Amount (ALHOA). The amount that would need to be contributed or spent by the city in 1999 is $21,505.72. The amount of contribution is based on a formula prescribed by law (Livable Communities Act of 1995) that utilizes market value, tax capacity and tax rates by the county assessor. Attached is an explanation on how the ALHOA amount is determined. This is the minimum amount that must be contributed or spent by the City in 1999 towards housing assistance, development or rehabilitation programs, etc. In addition, the City must also establish that the City spent or will spend the ALHOA amounts required in 1997 (0$) and 1998 ($11,210.83). The total amount for 1997-1999 is $32,716.55. The City's TIF assistance for "The Farmstead Project" is a qualified contribution and one year ofTIF assistance exceeds the entire ALHOA amount. No general fund dollars need to be expended by the City. In addition to the financial contribution, the City will also be required, through negotiations with the Metropolitan Council, to adopt affordable and life-cycle housing goals for the City. Attached is an example of a housing goals agreement received from Met. Council in the past. If the City Council chooses to participate in the program for 2000, a model resolution has been provided by the Metropolitan Council for adoption by the Council. A decision to participate in 2000 must be made by November 15, 1999. \. J' ~ Metropolitan Council Working for the Region, Planning for the Future '\ / REC=IVED DATE: August 6, 1999 AUG 0 9 1999 TO: City Managers and Administrators Cl"'j\l' !lie: .. -.It"'I(lV....R ., ......'J r'.; ~L!~I 'It: FROM: Thomas C. McElveen, Director of Housing and Redevelopment SUBJECI': Certification of 1999 ALHOA Your community is encouraged to participate with other neighboring communities and the Metropolitan Council in contributing to the region's overall economic competitiveness through the provision of affordable and life-cycle housing by enrolling in the Metropolitan Livable Communities Act (LCA) Local Housing Incentives Program. Participation in this program is voluntary but is required if your community wants access to a $15 million. fund for maintaining or developing housing to meet needs oflocal residents and the region, clean up polluted sites or undertake development that links housing, employment and transportation. In 1999, 101 communities participated. To participate, communities must formally elect to do so, and agree to make a local contribution of dollars to meet local affordable or life-cycle needs. \ ) Looking ahead to 2000, the Metropolitan Council seeks your community's participation in Livable Communities efforts. As part of the LCA legislation, the Council provides to each community on an annual basis an "Affordable and Life-cycle Housing Opportunities Amount (ALHOA)". The ALHOA is derived from the formula prescribed in law including market value, tax capacity and tax rates by the county assessor. It is the minimum amount of local expenditure to support or assist the development of affordable and life-cycle housing or maintain and preserve such housing in order to continue participation in the program. Communities have some flexibility in determining which local expenditures fulfill their ALHOA contribution. Examples include housing assistance, development or rehabilitation programs, and local housing inspection and code enforcement, or local taxes to support a local or county HRA. If your community should choose to begin participation or renew past participation in the LCA in 2000, the ALHOA expenditure for your community is indicated on the enclosed ALHOA notification. The law also requires that you establish that the community spent or will spend the ALHOA that was required through the formula during 1997, 1998 and 1999. You may not have kept a record of your community's ALHOA for those years, but we will he happy to get you this information upon request. Your community's intent to participate in the 2000 LCA Local Housing Incentives Program is needed by Nov. 15. To help you begin preparations, a model resolu~ion is enclosed. Planning assistance for staff or information presentations for elected officials are available by contacting your sector representative (see below). Questions about the ALHOA can be referred to Guy Peterson at 651/602-1418. Thank you for your consideration. Sector Representatives: '\ ) Anoka and Ramsey Counties Dakota and Washington Counties Hennepin County Carver and Scott Counties Sandra Pinel Patrick Peters Tom Caswell Carl Schenk 651/602-1513 651/602-1617 651/602-1319 651/602-1410 230 East fifth Street Y'lJi~~\I999\'799aUao.~ ~ edmin.doc St. Paul. Minnesota 55101-1626 (651) 602.1000 fax 602.1550 mOI1TI 291-0904 Metro Info Une 602-1888 An Equal Opportunity EmplDy... EXPLANATION OF '. J AFFORDABLE LIFE-CYCLE HOUSING OPPORTUNITIES FOR THE YEAR 1999 TO BE EXPENDED IN 2000 Simply stated, here's how we determined you community's ALHOA for 1999 that is to be expended in 2000. First, we determined the average market value of your city's houses in 1995, doubled it to arrive at a base value. We then found all of the 1995 high priced houses that were above this base amount and subtracted the base value from each of those high priced houses to arrive at an excess value number for each house. Next we added up all of those high priced house's excess values to arrive at the total base year excess number. This 1995 number doesn't change. We did the same for the current year, this time using the current market values for the houses and the current base value using the Consumer Price Index change according to the requirements of the legislation. If the current year's excess is bigger than the 1995 excess, we subtracted the 1995 excess from the current year's total excess to arrive at the Growth in Excess. We multiplied that Growth in Excess times your city's tax rate. This is the Affordable and Life Cycle Housing J Opportunities Amount for this year. This means that if there is no growth in the total excess from 1995, then there is no Opportunities amount. Definitions: HOMESTEAD A homestead is defined as property regularly "homesteaded" by its owners. For farm homes, it represents the assessment of the farm house, a garage and one acre ofland only. CONSUMER PRICE INDEX (CPI) The Consumer Price Index measures the inflation factor in the U.S. economy. The Department of the Interior publishes this rate monthly along with a yearly average. For this program, the yearly average cpr is used. To ensure that this base value does not lose its meaning in future years the base value is increased by the cpr each year. This increased value approximately represents the effect of inflation on the market value of houses in your city. By changing the base value every year, the houses that were not included in the first base year calculation should not be included in future years just because the market value has increased due to inflation. Refer to attached sample city printout for assistance . , , / Column A-Any town This is the name of your city , / Column B-2500,OOO This is the 1998 value used for identifying homesteads in your city that were above this hurdle number. This hurdle number was the result of multiplying the base value (see above for the definition of the base value) times the CPI change from 1995 to 1998. Column C-255,736 This is the 1999 value used for identifying homesteads in your city that were above this hurdle number. It is exactly like Column B, except the CPI change is now from 1995 to 1999. Column D-200,OOO This is the 1995 sum of all houses having values above the base value. It represents only those houses that were above the base value, and reflects only the amount left over after subtracting the base value from each house valuation. For example: If a high priced house had a value of $ 240,000 and the base value for the city was $ 235,000, then that high priced house had an excess of 5,000 (240,000 - 235,000 = 5,000). This original amount does not change. This original figure is used as the basis to determine if you city has had ) any growth in high priced homes since 1995. Column E-250,OOO This is the 1999 sum of the high priced homes having values above the current hurdle rate found in Column C. Like Column D, it represents only the excess amounts not the entire home value. Column F-50,OOO Quite simply this is Column F minus Column E. If your city has added higher priced homes since 1995 you should have a balance in this column. If you city has not seen an increase in the higher priced homes since 1995 there should be no balance in this column. There is no negative balance in this column. All negative values become zero. This number is the basis for all subsequent calculations on this form. Column G-125,OOO.OO , .. This number is your increased growth in higher priced homes (Column F) multiplied by you city's local tax rate (Column K). It represents the extra oropertv taxes received by your city on the higher priced homes identified in Column E. , " " Column H-230,000 This number is the total of all homestead property tax capacity (not market value of the properties) in your city times 4%. The number is calculated and supplied by your County Auditor. Why 4%? Since all higher priced homes will have a value above $72,000, then their tax capacity would be at 2%. However, since the program doubles the market value to arrive at the base value, then the tax capacity on the homestead tax capacity should also be doubled or 4% (2% x 2 = 4%). / Column 1-57,500.00 This number is the result of multiplying the 4% Homestead Tax Capacity (Column H) times your city's local tax rate (Column K). Column J-12,500.00 This column is the lower of Column G or Column I. Simply stated it represents the .' calculated extra property taxes your city receives from these higher priced houses, In some cases these extra property taxes may be the 4% Homestead Tax Capacity number (Column J) rather than the Excess Growth number (Column G). In those instances, the growth of high priced homes is faster that 4% ofthe net tax capacity for the city. Column K-25.000 % / This is your city's local tax rate for 1999 as certified by your County Auditor. Column L-12,500.00 This is the same as Column J. It represents the Affordable Life-Cycle Housing Opportunities Amount for 1999. Column M-125 This is the actual number of higher priced homes that had values above the 1998 hurdle rate. Column N-150 This is the actual number of higher priced homes that had values above the hurdle rate for 1999. ' Column 0-20.00% / This is the increase in higher price homes from 1998 to 1999. 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RESOLUTION ELECTING TO BEGIN PARTICIPATING IN THE LOCAL HOUSING INCENTIVES ACCOUNT PROGRAM UNDER THE METROPOLITAN LIVABLE COMMUNITIES ACT CALENDAR YEAR 2000 WHEREAS, the Metropolitan Livable Communities Act (Minnesota Statues Section 473.25 t0473.254) establishes a Metropolitan Livable Communities Fund which is intended to address housing and other development issues facing the metropolitan area defined by Minnesota Statutes section 473.121; and WHEREAS, the Metropolitan Livable Communities Fund, comprising the Tax Base Revitalization Account, the Livable Communities Demonstration Account, the Local Housing Incentive Account and the Inclusionary Housing account, is intended to provide certain funding and other assistance to metropolitan area municipalities; and WHEREAS, a metropolitan area municipality is not eligible to receive grants or loans under the Metropolitan Livable Communities Fund or eligible to receive certain polluted sites cleanup funding from the Minnesota Department of Trade and Economic Development unless the municipality is participating in the Local Housing Incentives Account Program under the Minnesota Statutes section 473,254; and WHEREAS, the Metropolitan Livable Communities Act requires the Metropolitan Council to negotiate with each municipality to establish affordable and life-cycle housing goals for that municipality that are consistent with and promote the policies of the Metropolitan Council as provided in the adopted Metropolitan Development Guide; and .. / WHEREAS, by June 30, municipalities electing to participate in the Local Housing Incentive Account Program must identify to the Metropolitan Council the actions they plan to take to meet the established housing goals; and WHEREAS, the Metropolitan Council must adopt, by resolution after a public hearing, the negotiated affordable and life-cycle housing goals for each municipality; and WHEREAS, a metropolitan area municipality which elects to participate in the Local Housing Incentives Account Program must do so by November 15 of each year; and WHEREAS, for calendar year 2000, a metropolitan area municipality that did not participate in the Local Housing Incentive Account Program during the calendar year 1999, can participate under Minnesota Statutes section 473.254 if: (a) the municipality elects to participate in the Local Housing Incentives Program by November 15, 1999; (b) the Metropolitan Council and the municipality successfully negotiate affordable and life-cycle housing goals for the municipality; (c) the Metropolitan Council adopts by resolution the negotiated affordable and Iife-cycle housing goals for the municipality; and (d) the municipality agrees to establish that it has spent or will spend or distribute to the local housing incentives account the required ALHOA for 1997, 1998 and, 1999. NOW, THEREFORE, BE IT RESOLVED THAT the {specific municipality} hereby elects to participate in the Local Housing Incentives Program under the Metropolitan Livable Communities Act during the calendar year 2000. By: Mayor By: Clerk V:\LIBRARY\COMMUNDV\PETERSON\1999\LCA new pan",s 99doc.doc ~ DR.:\FT HOUSING GOALS AGREEMENT METROPOLITAN LIVABLE COMMUNITIES ACT PRINCIPLES The city of Andover supports: 1. A batanced housing supply, with housing available for people at all income levels. 2. The accommodation of all racial and ethnic groups in the purchase, sale, rental and location of housing within the community. . 3. A variety of housing types for people in all stages of the life-cycle. 4. A community of well-maintained housing and neighborhoods, including ownership and rental housing. 5. Housing development that respects the natural environment of the community while striving to accommodate the need for a variety of housing types and costs. 6, The availability of a full range of services and facilities for its residents, and the improvement of access to and linkage between housing and employment. GOALS To carry out the above housing principles, the City of Andover agrees to use benchmark indicators for communities of similar location and stage of development as affordable and life- cycle housing goals for the period 1996 to 2010, and to make its best efforts, given market conditions and resource availability, to remain within or make progress toward these benchmarks. " CITY INDEX II BENCHMARK II GOAL AffordabiIity Ownership Rental 72% 69-87% 26% 35-50% Life-Cycle Type (Non-single family detached) Ownerlrenler Mix 4% 33-35% .. . Density 95/5% (75) / (25)% Single-Family DelOlched Multifamily l.O/acre J.9-2.3/acre O/acre 10.13/acre To achieve the above goals, the City of Andover elects to participate in the Metropolitan Livable Communities Act Local Housing Incentives Program, and will prepare and submit a plan to the Metropolitan Council by June 30, 1996, indicating the actions it will take to carry out the above goals. , / CERTIFICATION Mayor Date CITY OF ANDOVER REQUEST FOR COUNCIL ACTION l DATE: September 21. 1999 AGENDA SECTION Staff, Committees, Commissions ORIGINA T1NG DEPARTMENT ITEM NO. t ,DiSCUSS Use of Trail Funds on Previously Approved Projects The City Council is requested to discuss the use of trail funds on previously approved projects as to if the trail funds can be allowed to be used on those past projects as requested by the Park and Recreation Commission, Todd J. Haas~ Parks ~ The past projects that have been recommended by the Commission to be paid from the trail fund are as follows (all of which are to be considered regional trails): Cambridge Estates, Shadowbrook 4th Addition, Fox Hollow, Grey Oaks, Chesterton Commons 4th Addition, Chesterton Commons North. The Commission has also recommended Kelsey-Round Lake Park (Phase II) be paid from the trail fund. Currently, Kelsey-Round Lake Park as was indicated to the MNDNR when the grant was approved would be paid for (City's share) from the 1999 Park Capital Improvement Budget ($50,000) and the remaining balance would be paid from the park dedication funds, " ; The concern City staff has is that if the Commission's recommendation is approved by the City Council to allow the past projects to be paid for from the trial fund, it will reduce the amount of trail funds for next years potential trail projects such as Coon Creek Corridor trail extension, Crosstown Boulevard south of 148th Avenue NW and along with new 2000 development projects. The reserved amount estimated from the feasibility report approved by the City Council were to be paid for from the park dedication funds for those past projects are as follows: 97-9, Cambridge Estates 98-16, Shadowbrook 4th Addition 98-27, Fox Hollow 98-28, Grey Oaks 98-30, Chesterton Commons 4th Addition 98-36, Chesterton Commons North $6,775 $23,927 $7,846 $3,129 $10,795 $1,000 $53,472 Plus the request by the Commission for Kelsey-Round Lake Park $50,000 $103,472 $162,438.01 Approximate trail fund available '. Trail funds available for next years potential projects $58,966.01 ~ So, Therefore 2 options exist for the City Council to decide on and they are as follows: A. Allow trail funds to be spent on past approved projects (and future potential projects) as recommended by the Park and Recreation Commission B. Allow the trail fund to be spent on only future potential projects as indicated in the item. CITY OF ANDOVER REQUEST FOR COUNCIL ACTION ) DATE: September 21. 1999 AGENDA SECTION Staff, Committees, Commissions ORIGINATING DEPARTMENT Todd J. Haas, _/ Engineering ~ ITEM NO. ~ .APprove Revised 1999 Park Capital Improvement Budget The City Council is requested to approve the revised 1999 Park Capital Improvement Budget as recommended by the Park and Recreation Commission at their August 19, 1999 meeting. 1999 Park Capital Improvement Budget · $50,000 - Kelcey Round Lake Park (Phace II) Hawkridge Park Well · $10,000 - Sunshine Park Trail and Bleacher Pad Improvements, Projects 99-1 & 97-52 $60,000 TOTAL " " Note: Kelsey-Round Lake Park is proposed to be paid for from the trail fund which is contingent upon the results from the previous item. " CITY OF ANDOVER REQUEST FOR COUNCIL ACTION I DATE: Seotember 21. 1999 AGENDA SECTION ORIGINATING DEPARTMENT Executive Session Administration Richard Fursman ITEM NO. q. Grievance of Disciplinary Action: Street Supervisor REQUEST: The City Council is requested to hold an executive session to review and make findings regarding disciplinary action taken by the City Administrator against the Street Supervisor. The session may be opened if the closed session is waived by Mr. Sowada. / ., , CITY OF ANDOVER REQUEST FOR COUNCIL ACTION I DATE: September 2 t,t 999 AGENDA SECTION Non-Discussion ORIGINATING DEPARTMENT City Clerk 0.0. ITEM NO. Approve Tobacco license lD. The Orion Company of Anoka, dba Big Bore Cigar Company, has applied for a tobacco license. Their offices are located at 3480 Bunker Lake Boulevard. This company takes phone and e-mail orders for cigars with personalized messages on the wrappers, sends the orders to Honduras and then the cigars are sent to those ordering them. No tobacco products on kept on site. '. / However, in order to purchase the cigars they need to have a tobacco license in the city where they have their offices. Council is requested to approve the license. Attached is a copy of the application form. '. , J '\ , / CITY of ANDOVER City of Andover License To Sell Tobacco at Retail Application Form Pursuant to City Ordinance No. 227, all persons requesting to sell tobacco at retail are required to provide the following information. . Full NameYI"rQ :ro~n~rY\ / 3=cf*l b~ / Address 3480 'f3yN~ ~ BLVD, NW AnD::JJ52. (IIlN 55304-:- "3 Ca~ q Location of Building ~ ~ A-BoU(' J , Name of Business ()7JDV\ l!-rm~f)i1\~ 01= Atc:oa\ IB?r BlbBa?E L'..1~fte.('. Type of Business Conducted at Location=r?~D ~ I agree to waive my constitutional rights against search and seizure and will J freely permit peace officers to inspect my premises and agree to forfeiture of my license if found to have violated the provisions of Ordinance 227 providing for the granting of this license, I hereby solemnly swear that the foregoing statements are true and correct to the best of my knowledge. q- 8 -qq Date ------------------------------------------------------------ ------------------------------------------------------------ Fee: $75.00 Receipt #: S 9/'10 City Council Action: License # Approved Denied \ I ----------------------------------------------------------- ----------------------------------------------------------- CI1Y OF ANDOVER REQUEST FOR COUNCIL ACTION , DA IT: September 21, 1999 AGENDA SECTION Non-Discussion ORIGINATING DEPARTMENT City Clerk ~. ~ ' ITEM NO. ~prove Increase/Non-Intoxicating Off-Sale liquor license Fee lr. The City Council is requested to approve an increase in the non-intoxicating off-sale liquor license fee. Since at least 1986 the license fee has been $40.00 per year. Staff is recommending an increase to $75.00 per year to cover the increased amount of staff time and paperwork involved with the issuance of licenses. " Following are the fees charged by some of our neighboring cities: " Anoka $50.00 plus $55.00 investigation fee Coon Rapids $100.00 Ramsey $60.00 Attached is a resolution increasing the fee beginning in the year 2000. J \ -' CITY OF ANDOVER COUNTY OF ANOKA STATE OF MINNESOTA NO. R -99 A RESOLUTION SETTING THE FEE FOR THE YEAR 2000 FOR OFF-SALE NON- INTOXICATING LIQUOR LICENSES IN THE CITY OF ANDOVER. The City Council hereby ordains that the fee for the year 2000 for off-sale non-intoxicating liquor licenses shall be $75.00. Adopted by the City Council of the City of Andover this 21st day of September, 1999. CITY OF ANDOVER " ATTEST: J. E. McKelvey - Mayor Victoria Volk - City Clerk -' CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: September 21. 1999 AGENDA SECTION Non-Discussion/Consent Item ITEM NO. Award Bid/99-32/1999 Reclaiming & Overlay ~. ORIGINATING DEPARTMENT Scott Erickson,~ <- Engineering The City Council is requested to approve the resolution accepting bids and awarding contract to Bauerly Bras" Inc. in the amount of $165,118.74 for the improvement of Project 99-32 for reclaiming and overlay. The bids received are as follows: Contractor Bid Amount Bauerly Bros" Inc. j North Valley, Inc. WB Miller Inc. Hardrives, Inc. $165,118.74 $177,777,80 . $185,177:09 $194,705.14 Engineer's Estimate $185,672.80 Bauerly Bros" Inc. has successfully performed other projects in the City of Andover. Funding will be from City Overlay Fnnns. -' CITY OF ANDOVER COUNTY OF ANOKA STATE OF MINNESOTA RES, NO. MOTION by Councilmember to adopt the following: A RESOLUTION ACCEPTING BIDS AND AWARDING CONTRACT FOR THE IMPROVEMENT OF PROJECT NO. 99-32 FOR 1999 RECLAIMING & OVERLAY. WHEREAS, pursuant to advertisement for bids as set out in Council Resolution No. 178-99 ,dated Auqust 17, 1999, bids were received, opened and tabulated according to law with results as follows: Bauerly Bros" Inc. North Valley, Inc, WB Miller Inc. $165,118.74 $177,777.80 $185,177.09 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Andover to hereby accept the bids as shown to indicate Bauerlv Bras.. Int. as being the apparent low bidder, / BE ITFURTHER RESOLVED TO HEREBY direct the Mayor arid City Clerk to enter into a contract with Bauerlv Bros., Inc. in the amount of $165.118.74 for construction of the improvements; and direct the City Clerk to return to all bidders the deposits 'made with their bids, except that the deposit ofthe successful bidder and the next lowest bidder shall be retained until the contract has been executed . '. and bond requirements met. . ._ ~":,. J MOTION seconded by Councilmember City Council at a reqular meeting this 21st Councilmembers of the resolution, and Councilmembers and adopted by the day of September ,19-illL, with voting in favor voting against, whereupon said resolution was declared passed. CITY OF ANDOVER ATTEST: J.E. McKelvey - Mayor I Victoria Volk - City Clerk Ol 0 '<t 0 0 0 II) 0 0 0 0 Ol Ol 0 CO 0 0 II) I'-: 0 0 0 0 0 - -' ui 0 r-.: 0 r-.: '<t ~ II) II) CO 0 0 II) ~ N 0) N ...... 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N I'--O>NNLO~ ~ ~ ~~ ~ ~ LL ~LL LL CD~ . 0>0 W ~ Z :- 0: I'-- <{ >M . 0 MOo> _LOOo Z W'O CDO:I'-- o:LOO:M ~ >~~ 0 LO:J:~ o Z W ~ M - I'-- <{ 0' 0 ~~~LO~~~ ~~o:~> ZULO <{ -:5Zu.iW~ .LO~M> ~C5Z ~~rn~>~~ ~zffiLO~ WU~ ~<{~~~~~ O:~~~O ~~~ 00: W~ -~ =:JrnO <{ <{<(~ Z~O>LOm~ aO:-~:J: O:~O -ZzO:C000MLOw~wrn ~rn~ gwo~~oo~~o~~~~ ~~$ MOI'--~...-~o:LO~ M.....I'--W.....~... CDWCDw~mmLO",-O:N:J:~zrn...-rn c: N 'E M '_ cn~ 0) tJ - <II ~c:: '0 ~ '-0) c...... .:.; U w ..., o 0: c.. z 0 )- U ~ U U Z <{ Z w 0: Z ~U ~ 0 rnz 0: ~ rn rn ~ w ~ w~ w > 0: )-0: :s:~ ~ 0 ~w :J:~ :J: 0: O::J: ~ 0 U w~ ~<{ 0: . 0: ..., =:JO 0::J: OU ~ O~ <{ <{o: z~ ZZ :J: 0 moo !." O:w w~ Wet ~~ C)- zt; Ww tJ o 't:I ... ~ ..... .., en en CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: SePtember 21. 1999 AGENDA SECTION Non Discussion Item ORIGINATING DEPARTMENT Planning ITEM NO. \;3 , Approve Quotes for Public Works and Sunshine Park Signs City of Andover 1685 Crosstown Blvd. NW. Request: The City Council is asked to approve the low quote(s) listed below for the Public Works and Sunshine Park Monument Sign(s). Megan Barnett Planning Intern Fundin!! Source: The Public Works Monument Sign will be funded through the Public Works and City Hall Sign(s) Fund. The Sunshine Park Monument Sign will be funded through the Park Dedication Fund. PUBLIC WORKS SIGN: Masonry Contractor: Companv Price Ron Novak Construction.................,.............. ...............,.......... ................... .$4,100.00 Elk River Brick & Stone......"....",.....,.......,................,......"................"......,$4,91 5.00 Sandblasted Si~n: Company Price Elk River Brick & Stone.............................................................................$I, 759.20 Arrow Sign. ......."...",.... .............."....."....",. ....................,..... ........."....",... $3,158.00 , , Page two Approve Sign Quotes City Council Meeting September 21, 1999 Four Kasota Pink Limestone Capstones for Brick Pillars: Companv Price Elk River Brick & Stone......................"........................................................$487.32 (19" x 19" x 4") SUNSHINE PARK SIGN Masonry Contractor: Companv Price Ron Novak Construction.............................,..... ...................,....................... .$3 ,400.00 Elk River Brick and Stone............,............................................................."..$5,874.00 Sandblasted Sunshine Park Si2n: Companv Price Elk River Brick & Stone.............."....................,........................................$2,202.90 Arrow Sign....., ...............", ................. ........."""..."",....", ,......"",.. ..........." $3, 158. 00 Three Grey Bedford Limestone Capstones for Brick Pillars: Companv Price Elk River Brick & Stone..................",...........................................................$789.90 (31" x 31" x 4") Page three Approve Sign Quotes City Council Meeting September 21, 1999 Public Works Sign Sandblasted Public Works Sign.....................................................$l, 759 .20w/tax (Elk River Brick & Stone) Capstones for Public Works Sign......................................................$487.32w/tax (Elk River Brick & Stone) Masonry Contractor For Public Works Sign..................................$4,lOO.OOw/tax (Novak Construction) I Total...... ................................................. ....................................... ..$6,346.52w/tax Sunshine Park Sign Two Sandblasted Sunshine Park Signs..........................................$2,202.90w/tax (Elk River Brick & Stone) Capstones for Sunshine Park Sign....................................................$789.90w/tax (Elk River Brick & Stone) Masonry Contractor For Sunshine Park Sign................................$3,400.00w/tax (Novak Construction) Total....... ............................................................ ..... ....................... .$6,3 92. 8 Ow/tax CITY OF ANDOVER REQUEST FOR COUNCIL ACTION ;' DATE: SEPTEMBER 21,1999 AGENDA SECTION NON DISCUSSION ITEM ORIGINATING DEPARTMENT DAN WINKEL, /) to FIRE CHIEF .' ITEM NO. ~QUEST TO BID FOR NEW FIRE DEPARTMENT PUMPER TRUCK I~. The Fire Department is requesting City Council approval to advertise for bids for a new Fire Department Pumper Truck. The proposed truck is a scheduled replacement and funding was approved as part of the 1999 Equipment Certificate. The approximate cost of the truck is $330,000 to $335,000. There will also be a miscellaneous list of equipment included in the bid process, with an approximate value of $5,500. The Andover Fire Department Truck Committee has worked on specifications for this vehicle during most of the last year. The completed specifications are about 90 pages in length and are available for review. The Andover City Mechanic has reviewed all of the mechanical parts of this vehicle and is satisfied with equipment listed. j The specifications will be mailed to between six and eight qualified manufacturers and requests will be made for sealed bids. The sealed bids will be due back in mid-October and a request for council to accept bids and order a new vehicle should be made at the first council meeting in November. , , CITY OF ANDOVER REQUEST FOR COUNCIL ACTION , / DATE: SEPTEMBER 21,1999 AGENDA SECTION NON DISCUSSION ITEM: ORIGINATING DEPARTMENT DAN WINKEL, tJ ,A\ FIRE CHIEF . VU ITEM NO. REQUEST TO PURCHASE TWO NEW PICK-UP I~ITY VEHICLES The Fire Department is requesting City Council approval to purchase two pick-up trucks/utility vehicles. As part of the 1999 Equipment Certificate, the Fire Department requested the replacement of two utility vehicles. The first vehicle to be replaced is a 1984 Mercury Station Wagon that needs repair work that exceeds the value of the car. The second vehicle to be replaced is a 1970 Dodge Pick-up that was originally purchased from the Minnesota D.N.R. Both of the new vehicles were approved for purchase with the 1999 Equipment Bond. The estimated cost of each vehicle was $25,000 complete. It is proposed that the new pick-ups be purchased under the state contract for this type of vehicle. City Mechanic, John Wallace, contacted Falls Automotive, Inc. located in Fergus Falls and asked for state contract prices of the new pick-ups. The proposed new vehicles will be the smaller size pick-ups with extended cabs and a third door. The base price for each vehicle is $18,686.00. In addition to the base price, some options will be added and deleted to bring the grand total for each truck to $19,391.00. In addition to the vehicles, emergency lights, some type of box cover and two-way radios will also be purchased. After including the miscellaneous equipment, the final costs will still be well below the $25,000 estimated price. Staffis recommending the purchase of two G..M.C. Sonoma Extended Cab 4 x 4 Pick-ups from Falls Automotive, Inc. of Fergus Falls, Minnesota. Please note that Andover has purchased vehicles from Falls Automotive in the past. / OS/2B/1993 19:21 218-735-7432 FALLS AUTOMOTIVE n-c PAGE ell ~ .J f~9tl I"~ F C111s ,AUTOMOTIVE, Il'fC. IrJ~ ~..[II][3 2228 College Way · Fergu~ Falls, MN 56537. ,:18-739-2283 . 800-726-7564 . Fax 218-736-74..12 . www.fl.lIsautomoti\ic.nln1 August 20, 1999 """"'.~ Andover Public Works -. John Wal181:e 1685 Crosstown Blvd NW Andover, MN 55304 Phone 612-755-8118 FAX 612-767.5190 PROPOSAL FOR 2000 GMC 4WD SONOMA EXT. CAB - FROM MN CO:-ITRACT 421925 The purpose of this letter is to propose to you the purchase offour wheel drive extended cab pickup trucks. Vehicles we propose meet or exceed the specifications outlined in our State of Minnesota Contract 421925 for the 1999 Model Year for the GMC Sierra regular cab trucks Item 8 four wheel drive, Price on the 200(1 model is $18,686.00, The State Contract vehicle contents are detailed on the Contract pages, This four wheel drive chassis is a 51501b GVWR Sonoma extended cab short box, with 4,3 Liter V6 engine, automatic overdrive transmission, air conditioning, A:\1FM radio, tilt and cruise, cloth seats,S P23 5/7SR 15 '\ tires, block heater, skid plate and tow hooks. Several options are available to either add or delete from the trucks as specified by the State of Minnesota, and we added/deleted to meet your list of specifications that follows. We propose the purchase (If new 20Q() GMC Sonoma, four wheel drive extended cab short box pickups, for the prices indicated below, plus any additional options selected and any ta.xes, registration, and fees _ Sonoma 4X4 Extended Cab PriCE: $ 18,686.00 delivered, plus tax, license, fees Thanks for this opportunity, We look forward to serving your transportation needs again Please call me to clarify any information rega,rding our proposal, If this proposal is acceptable, please select colors, sign below and return it 10 us. You may FAX to us at 218-736-7432 Sincerely, ~ b/~.v/ Geny }Vomer, Commercial and Fleet Manager Color Interior PROPOSAL ACCEPTED BY Insurance Policy No, Date . equal Emplo~"rrrn' Opportlmily/A/jirmQtit., ActiNI F.:t'P'!pk.lycr . , ~-....~ io-oIW I Ul"h.J i J..V:... J.N_" ~~G~ r;:: " FALLS AUTOMOTrVE) mc. PROPOSAL ON ZOOO GhfC SONOMA. r:XTENDr:D CAB ':X", PICKUP fT:::M PPJCE APPROVAL (X) L Base price per 1999 Commct 421925 Item 1) GMC Sonoma $ 18,686,00 _X_ ~ :1, Options available to add to bid spec c., Front reclining bucket seats and::onsole b Heavy duty battery 690 eCA c. Third door (driver's side) d Cassette player in AMFM radio e, Sliding back v.indow f On OtrRoad tread on all 5 tires g. 3.73: 1 axle ratio with limited slip differential h. Deep tinted glass in rear 265.00 91.00 272.00 J40.00 110,00 223.00 275.00 108.00 ~" '... x y., 3. Delete Options - Credits Z" Delete tilt wheel and cruise control b. ReplBce automatic transmission with 5 speed manual c. Delete air conditioning d. Delete cruise contro~ but retain tilt wheel c:, Delete Skid plates Approved by: Date - 304.00 - 665.00 - 620.00 - 156,0(} -~' 80.00 S $ /1 ?1/ I 990120 \ 4 Delivery at $2.00 per mile or per tins quote 5. Total Price with all options and aCl:essories ) CITY OF ANDOVER REQUEST FOR COUNCIL ACTION \ " DATE: SEPTEMBER 21. 1999 AGENDA SEalON NON DISCUSSION ITEM ORIGINATING DEPARTMENT DAN WINKEL, A tV FIRE CHIEF IJ. . ITEM NO. UPDATE FIRE DEPARTMENT (to. COMPUTER SYSTEM The City Council is requested to approve the purchase of computer equipment for the fire department. A new lap top computer is proposed for the Fire Chief The lap top will also include a docking station which will allow easier use in the office and the chiefs vehicle. The cost for the lap top, docking station, and automobile adapter is $4,525. The proposed lap top will be purchased from Gateway computer. Price quotations were also obtained from Dell, Compaq, and Toshiba. J Please note that there will be additional computer related updates at Fire Station #1. The two existing computers will be updated to perform much faster and also have additional memory added. All computers will be networked and also be linked to City Hall and Public Works. The Fire Station currently does not have a direct link to City Hall or Public Works. " The funding for this request will come from the 1997 Fire Department Equipment Fund that has a balance of about $17,000. System Type: Solo 9300 ex http://quotes/shell-cgiIlNTRAquotel,pl ~Gateway / Account Executive: Phone: Fax: Attention: Address: Phone: Fax: Quantity: 1 GW Quote #: 09085408 Quote Date: 09/08/99 12:26 CST Solo 9300 ex ..............,..".............,..,.,....,..,.......,........................,........,.'....,..............,..,. QUOTE ...................................................................................h...................... , Screen: 15.0" XGA Active Matrix TFT Color Display Processor: Intelilll Pentiumilllll processor 400MHz w/256K Full Speed L2 Cache Memory: 160MB SDRAM (2-64MB Module) Graphics Accelerator: 2x AGP A TI Mobility-P w/8MB SGRAM Zoomed Video Port: Zoomed Video Support Hard Drive: 10GB Ultra ATA Removable hard drive Floppy Drive: Modular 3,5" Diskette Drive CD-ROM/DVD: Modular 4X DVD-ROM Drive Multimedia: Integrated 16-bit Sound, Stereo Speakers, Internal Microphone,Headphone/Speaker Jack, Line-In and Line-out Mic Jacks Fax/Modem: Integrated V.90 56K Modem Keyboard: Full-Size 88-key Keyboard with MS Windows 95 Keys Mouse: EZ Padilll Pointing Device Operating System: Microsoftilll Windows 98 Second Edition Application Software: Microsoftilll Office 2000 Professional added: US$199 Anti-Virus Software: Norton Anti-Virus Software Expansion Slots: Two deep socketed PCMCIA Type II slots Battery: (1) 12-cell Lithium Ion battery and (1) AC Pack plus (1) 9-cell Lithium Ion battery Carrying Case: Deluxe Carrying Case External ports: NTSCIPAL Input and Output, (2)USB, Parallel, Serial, VGA, PS/2, SIPDIF, Dolby Digital Output, IEEE 1394 and Infrared Ports Dimensions: 12.7inch x 10.39inch x 1.62inch 0IV x D x H); approximate weight 7,761b. Surge Protector: APC PNOTE PRO Notebook Surge Protector added: US$29 Gateway Solo Auto/Airline Adapter: Gateway Solo Auto/Airline Adapter added: US$99 Gateway Docking Station: Soloilll9300 Docking Station added: US$299 Certifications: FCC Class B, UL and CSA certified Service Program: 3 Year Parts & Labor Limited Warranty added: US$100 / .................... .................. ........................................... .................-.......................................................... ................. Base Price: US $3799 Configured Price: US $4525 Total System(s) Price: US $4525 Tax (if any): US $ Shipping and Handling (if any): US $ Total Price: US $4525 .~~:~.:.:::::::::::::::::..::::::::::::.~~~~~~~~~~~~~~.~~~~~~:~~~~~~.~.~:!:.:.:~.:.~~.~~~~~::~.~~~.~~~~.~:.~.~~~~.~~~~:!:.!:~.::~~.~.~~:~~.~~:::~~!~.~.!!~~~~~~~~:::~:::~~:....~.~~:::~..~~~~~..:::::!:~..!~.~~.~::!:::~~~~~...~.~~:,,,:!~~.,,,,:,,:!~...,,::::~:..::::::...,~....:~::::::. , Comments: When placing your order, please attach this quote to your purchase order. A copy of this quote will be held for a period of 30 days after 09/08/99, When ordering from this quote, we will provide you with the latest pricing, infonnation and availability of product, / lof2 9/8/99 12:28 PM CITY OF ANDOVER REQUEST FOR COUNCIL ACTION , / DATE: SEPTEMBER 21.1999 AGENDA SECTION NON DISCUSSION ITEM ORIGINATING DEPARTMENT DAN WINKEL, FIRE CHIEF /J. tIJ ITEM NO. REQUEST TO APPROVE CONTRACT FOR SERVICES WITH ANOKA-HENNEPIN TECHNICAL COLLEGE i'1. The Fire Department is requesting City Council to approve a contract for services with Anoka-Hennepin Technical College. The contract is an annual renewal to contract for firefighter training. By signing this contract for services not to exceed $10,000, the Fire Department/City will not have to sign a separate contract every time we use an Anoka-Hennepin Technical College instructor. On average, the Fire Department will spend approximately $12,000 to $15,000 dollars a year for services provided by the college, There are a number of other firefighter training providers that are also used during the year. As we approach the $10,000 cap on this contract, a new and revised contract will be sent by the college. J Staffis recommending approval to sign a Contract for Services with the Anoka-Hennepin Technical College for the fiscal year July 1, 1999 to June 30, 2000. Anoka-Hennepin Technical College 1355 West Highway 10, Anoka, MN 55303-1590 / Customized Training Services (612) 576-4800 Fax (612) 576-4802 Tuesday, September 07, 1999 Dan Winkel, F,C, Andover Fire Department 1785 Crosstown Boulevard Andover, MN 55304 Re: Our Contract No. 1096, Fire & Safety Related Courses Coordinator: Mashuga, Dale Contract amount: $10,000.00 Enclosed is our contract for services to be conducted for Andover Fire Department during the next fiscal year. The State of Minnesota requires that we have a contract on file for training conducted through Customized Training Services. This contract is for our fiscal year of July I through June 30. By preparing a contract for the entire year, we will not have to prepare a new contract for each course. You will only be invoiced for courses that are conducted during this period. At the end of the fiscal year any amount remaining on the contract will be cancelled. If at any time during the fiscal year you wish to add courses that will exceed the contract maximum we will amend your contract. Please sign and return this contract as soon as possible, as we are required by the State of Minnesota to have a contract signed and returned to us BEFORE the first class is conducted. Should you have any questions, please feel free to contact your Customized Training Services Coordinator. We look forward to a continuing partnership. /~~ Gary S. Levine, VP Customized Training Services cts-db Enclosures Minnesota State Colleges and Universities An equal opportunity employer. ~ F.Y.: )"t1;<J I Cost Center: 160004 I Obj. Code:_ I Amount: ell 1:J $10,000.00 STATE OF MINNESOTA MINNESOTA STATE COLLEGES AND UNIVERSITIES CUSTOMIZED TRAINING INCOME CONTRACT I Vendor #: /P,O.#: .. ./ Anoka-Hennepin Technical College , 1355 West Highway 10 Anoka, MN 55303 (612) 576-4800 FAX (612) 576-4802 Anoka-Hennepin Technical College (hereafter College), by virtue of its delegated authority from the Board of Trustees of the Minnesota State Colleges and Universities, and Andover Fire Department (hereafter Purchaser) agree as follows: 1. DUTIES OF THE COLLEGE. The College agrees to provide the following: Title ofInstruction/Activity/Service: Fire & Safety Related Courses Dates of Instruction/Activity/Service: Varies according to course. See Exhibit A attached. Instructor/Trainer/Consultant: INSTRUCTOR AHTC Location: Varies according to course, See Exhibit A attached. Other Provisions: Date and time are subject to change as mutually agreed upon by the Purchaser and Technical College. / II. DUTIES OF THE PURCHASER. The Purchaser agrees to provide: Facility for instruction, equipment and attendance sheels. III. SITE OF INSTRUCTION/ACTIVITY/SERVICE. Purchaser shall make all of the arrangements, including any payment, for the location to be used for the Instruction/Activity/Service, IV. CONSIDERATION AND TERMS OF PAYMENT. A. Cost Cost ofInstruction/ Activity/Service: Not to exceed $10,000.00 Other fees: N/ A B. Terms of Payment The College will send an invoice for the Instruction/Activity/Service performed, The Purchaser will pay within 30 days of receiving the invoice. Please send payment to: Anoka-Hennepin Technical College 1355 West Highway 10 Anoka, MN 55303 (612) 576-4800 FAX (612) 576-4802 V. AUTHORIZED AGENTS FOR THE PURPOSES OF THIS CONTRACT. Customized Training Income Contract No. 1096 Page I of] "\ J A. Purchaser's authorized agent: Dan Winkel, F.C, 8. College's authorized agent: Gary S, Levine, VP Customized Training Services VI. TERM OF THE CONTRACT A. Effective date: Tuesday, September 07, 1999 B. End date: Friday, June 30, 2000 or until all obligations set forth in this contract have been satisfactorily fulfilled, whichever occurs first. VII. CANCELLATION. This contract may be canceled by the Purchaser or the College at any time, with or without cause, upon thirty (30) days written notice to the other party. In the event of such a cancellation, the College shall be entitled to payment, detennined on a pro rata basis, for work or Instruction! Activity/Service satisfactorily perfonned. Contracted classes not meeting enrollment expectations of the client and college may be canceled within 48 hours of the agreed start date. VIII. ASSIGNMENT, Neither the Purchaser nor the College shall assign or transfer any rights or obligations under this contract without the prior written approval of the other party. IX. LIABILITY. Purchaser agrees to indemnifY and save and hold the College, its representatives and employees hannless from any and all claims or causes of action arising from the perfonnance of this contract by the Purchaser or the Purchaser's agents or employees. This clause shall not be construed to bar any legal remedies the Purchaser may have for the College's failure to fulfill its obligations pursuant to this contract. X, AMERICANS WITH DISABILITIES ACT (ADA) COMPLIANCE. The Purchaser agrees that in fulfilling the duties of this contract, the Purchaser is responsible for complying with the applicable provisions of the Americans with Disabilities Act, 42 U.S,C. Section 12101, et seq. and regulations promulgated pursuant to it. The College IS / NOT responsible for issues or challenges related to compliance with the ADA beyond its own routine use of facilities, services, or other areas covered by the ADA. XI. AMENDMENTS. Any amendments to this contract shall be in writing and shall be executed by the same parties who executed the original contract or the successors in office. XII. GOVERNMENT DATA PRACTICES ACT. The CONTRACTOR must comply with the Minnesota Government Data Practices Act, Minnesota Statutes Chapter 13, as it applies to all data provided by the STATE in accordance with this contract, and as it applies to all data, created, collected, received, stored, used, maintained, or disseminated by the CONTRACTOR in accordance with this contract. The civil remedies of Minnesota Statutes Section 13,08 apply to the release of the data referred to in this Article by either the CONTRACTOR or the STATE. In the event the CONTRACTOR receives a request to release the data referred to in this Article, the CONTRACTOR must immediately notifY the STATE. The STATE will give the CONTRACTOR instructions concerning the release of the data to the requesting party before the data is released, XIII. RIGHTS IN ORIGINAL MATERIALS. The College shall own all rights, including all intellectual property rights, in all original materials, including any curriculum materials, inventions, reports, studies, designs, drawings, specifications, notes, documents, software and documentation, computer based training modules, electronically or magnetically recorded materials, and olher work in whatever fonn, developed by the College and its employees individually or jointly with others or any subcontractor in the perfonnance of its obligations under this contract. This provision shall not apply to the following materials: N/A Cllstomi=cd Training Income Contract No. 1096 Page 20f3 XIV. JURISDICTION AND VENUE. This contract, and amendments and supplements thereto, shall be governed by the laws of the State of Minnesota. Venue for all legal proceedings arising out of this contract, or breach / thereof, shall be in the state or federal court with competent jurisdiction in Ramsey County, Minnesota. XV, OTHER PROVISIONS. (Attach additional page(s) if necessary): IN WITNESS WHEREOF, the parties have caused this contract to be duly executed intending to be bound thereby. APPROVED: l. PURCHASER PURCHASER certifies that the appropriate person(s) have executed the contract on behalf of PURCHASER as required by applicable articles, by-laws, resolutions or 2. MINNESOTA STATE COLLEGES AND UNIVERSITIES ANOKA-HENNEPIN TECHNICAL COLLEGE By (Authorized signature only) Date By Title Date By (Authorized signature only) Title Date MnSCU003 8J5/99 j Customized Training income Contract No. 1096 Page 3 of3 " CITY OF ANDOVER REQUEST FOR COUNCIL ACTION '- DATE: SEPTEMBER 21.1999 / AGENDA SECTION NON DISCUSSION ITEM ORIGINATING DEPARTMENT DAN WINKEL, f) 1/) FIRE CHIEF . W. ITEM NO. REQUEST TO PURCHASE EMERGENCY VEHICLE PRIORITY C~TROL INFRARED EMITTERS Staff is requesting City Council approval to purchase Emergency Vehicle Priority Control Infrared Emitters for all of the Fire Department vehicles. As a reminder to Council, the emitters would be installed on each vehicle and are used to change and control traffic lights that are equipped to do so. The entire Bunker Lake Boulevard reconstruction project has had the appropriate equipment installed to change the lights when needed. The City of Andover was assessed costs to have this equipment installed. Please note that the proposed emitters are compatible to the equipment installed for the Bunker Lake Boulevard project. There are a number of other traffic lights in Andover that have some of the appropriate wiring for the equipment needed. I Staffis recommending purchase of the emitter equipment from Rennix Corporation who also supplied the hardware for the Bunker Lake Boulevard Project. Please note that because this is the first time Andover will be purchasing and using this type of equipment, Rennix Corporation has proposed a 40% savings for the first ten emitters we buy. It is also recommended that Andover purchase the Model492H Priority Emitter with the savings previously mentioned. The approximate cost to purchase and install emitters in 16 fire department vehicles is $13,400. Staff has previously identified the funding source for this equipment to come from balance remaining of the 1998 Capitol Equipment Funds. / QUOTATION RENNIX CORPORATION PO Box 280 3121 S. St. Croix Trail. Suite 102 Afton, MN 55001 PHONE 651-998-G3n FAX 651-998-G379 Date: August 24,1999 Quote Number: M99-124 TO: Dan Winkel, Fire Chief City of Andover RE: "New City Promotion" for 3M Opticom™ We are pleased to quote the 3M ITS equipment for the above project as follows: EA Model 492H High Priority Emitter $ 750 (Newest model, self contained, encoded at factory, gray. EA Model 792H High Priority Emitter* $ 995 (Newest model, self contained, programmable encoding, black) EA Model 5925/7935 Emitter switch (Optional) , $ 85 Fully enclosed box with push button switch And dashboard mounting bracket. EA Model 7938 Emitter switch (Optional) $ 55 Rocker type switch with simple mounting "L" bracket. EA Model 79015 Emitter Software Kit (Optional)* $ 195 (For Model 792H programming) The Andover Fire Department may purchase up to 10 emitters and switches at a discount of 40% off the above quoted prices. Additional emitters can be purchased for the prices quoted above. This promotional package provides a 40% discountto help the city start an emergency vehicle preemption program. This promotional program is valid with a purchase order directly from the city. The limit of 3M/Rennix participation is on 10 vehicles on a one-time order based on a total intersection count of 20 intersections in the City of Andover. Emitter installation is also available for $350.00 for 1-5 vehicles, $300.00 for 6-10 vehicles or $275.00 for 11 or more vehicles. Emitters will be installed free standing, Emitters may be able to be mounted in lightbars when requested by the department if this is found practical, however this may entail additional costs, Quoted prices do not include Sales Tax or Shipping and Handling. Quoted prices are good through 1999. Terms are Net 30 to approved credit, Thank you, )~' IX CORP~19N . ;Z;{~ 7/~ -h ' , '/ Eydie Peterson ,~ ) CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: September 16, 1999 AGENDA SECTION NO. Nonilliscussion/Consent Agenda ORIGINATING DEPARTMENT APPROVED FOR AGENDA Frank Stone - Public Works ITEM Superintendent BY: NO. Overhead Lube System Price Quotes ,q. We received the following three prices quotes for Overhead Lube System. Lubrication Service & Supplies Pumps, Meters, Tubing, Reels, Regulators Double Wall Steel Bulk Oil Tanks (UL) Double Wall Waste Oil Tanks (UL) Total $10,017.09 11,389.00 1.155.00 $22,561.09 / Pump and Meter Service, Inc. Pumps, Meter, Tubing, Reel, Reel, Regulator Double Wall Steel Bulk Oil Tank (UL) Zahl Equipment Pumps, Meter, Tubing, Reels, Regulator Double Wall Steel Bulk Oil Tanks (UL) Double Wall Steel Bulk Oil Tank (UL) Total $25,990.04 Total $17,133.00 11,389.00 1.155,00 $29,677.00 We have $15,000.00 in the 1999 Equipment Certificate budget. We were awarded a Safety Grant from Minnesota Workplace Safety Consultation/Grant Application and this is where the difference will come from. I recommend we award this purchase to Lubrication Service and Supplies. MOTION: SECOND: file: T:lwordlfront-dslc092199,doc ~ CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: September 16, 1999 AGENDA SECTION NO. Non/Discussion/Consent Agenda ORIGINATING DEPARTMENT APPROVED FOR AGENDA ITEM NO. Approve Purchase of a Body, Hoist, Plow and Hydraulics. Ao. Frank Stone - Public Works Superintendent BY: We request Mayor and Council approve the purchase of a Crysteel2-yard Tipper body, hoist, plow and hydraulics for the new Ford F450. This unit will also have under-the-hood hydraulics, 9' Fisher plow and controls. We will purchase it from Crysteel Truck Equipment for $11,074.00. The money for this purchase is in the 1999 Equipment Certificate. MOTION: SECOND: file: T:lwordlfront-dslc092199a,doc CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE September 14, 1999 AGENDA SECTION NO. Non - Discussion I Consent Item ORIGINATING DEPARTMENT APPROVED FOR AGENDA Brian Kraabel- Public Works Utilities Supervisor BY: ITEM NO. Approve purchase of Easement MachineIPublic Works !AI. Mayor and Council, you are asked to approve the purchase of an Easement Machine that will be used to clean portions of the sanitary sewer and storm sewer lines that are not accessible by truck. This item has been budgeted for in the storm sewer and sanitary sewer budgets. 602-49450-580 $10,000.00 101-43150-580 $10,000.00 Quotes were received from two companies as follows: Sreco Flexible Pipe Tool Company ABM Equipment & Supply Inc. $18,695.31 $19,760.01 It is my recommendation that we accept the quote from Sreco Flexible Pipe Tool Company and to supply the Easement Machine. MOTION: SECOND: - , / CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: September 21. 1999 AGENDA SECTION Non-Discussion/Consent Item ORIGINATING DEPARTMENT ITEM NO. Update of Kelsey-Round Lake Park! (~~6-1/Ribbon Cutting Ceremony Todd J, Haas, Engineer~ The City Council is requested to schedule a ribbon cutting ceremony for Thursday, October 7th at 6: 15 PM for the new trail at Kelsey-Round Lake Park, Project 96-1. The City Council and residents are encouraged to attend. \ / CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: September 2 1. 1 999 AGENDA SECTION ORIGINATING DEPARTMENT Non-Discussion Administration Richard Fursman ITEM NO. a3. Approve Hire/Public Works Maintenance Supervisor REQUEST: The City Council will be requested to make a contingency appointment of an individual recommended by staff to the position of Street Supervisor. Six public works personnel interviewed for the position on Tuesday, September 14. A second interview is being scheduled for Monday or Tuesday, before the City Council meeting. It is likely an individual will be recommended from the three. The outcome ofthe issue with Ray Sowada will be important to consider as to the timing of the appointment. CITY OF ANDOVER REQUEST FOR COUNCIL ACTION , , ~~ -,' DATE: September 21. 1999 AGENDA SECTION Non-Discussion/Consent Item ORIGINATING DEPARTMENT ITEM NO. Rtfpprove Use of Trail Fund Todd J, Haas, Parks ~ The City Council is requested to approve the use of the trail fund that is available for trail projects as recommended by the Park and Recreation Commission. The City Council has not at this point authorized the use of these funds for any trail projects. Note: There is an item on the agenda regarding projects that have been requested by the Park and Recreation Commission to utilize the funds. Cash as of 1-1-99 Plus: Interest earned for 1st quarter $160,611.82 $1,826.19 . , / TOTAL TRAIL FEE DOLLARS $162,438.01 \ L--- UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION Northern Natural Gas Company ) Docket No. CP99-191-001 RESPONSE OF RELIANT ENERGY MINNEGASCO, A DIVISION OF RELIANT ENERGY RESOURCES, INC., IN SUPPORT OF REQUEST FOR AN EXPEDITED CERTIFICATE Pursuant to the deadline established in the Commission's Notice of Amendment, issued September 2, 1999, in the above-referenced proceeding, Reliant Energy Minnegasco, A Division of Reliant Energy Resources Corp. ("Minnegasco") files this response in support of the Request of Northern Natural Gas Company for Phased In Construction and an Expedited Certificate for Phased [sic] I Construction ("Request"), filed August 26, 1999, in this proceeding. Response and Request for Expedited Commission Action By the Notice of Amendment, the Commission advised interested persons that Northern .. Natural Gas Company ("Northern") had amended its filing in this proceeding and now proposes to phase construction of Northern's proposed Elk River Loop 1999 Project ("Elk River Project"). By the amended filing, Northern seeks an expedited certificate for the initial phase and asks the Commission to act on the Request by September 20, 1999. The Commission advised persons wishing to be heard to intervene or to protest by September 17, 1999. Minnegasco, as noted earlier, has already intervened and wishes to be heard in support of Northern's request for an expedited certificate of public convenience and necessity to permit Northern to commence construction promptly on approximately six (6) miles ofthe Elk River Project. Minnegasco is vitally interested in the Elk River Project which is - 2 - central to Minnegasco's efforts to meet the needs of its customers for the 1999-2000 heating season which begins in less than two months. The Elk River Project is an integral part ofMinnegasco's long range plans. Specifically, in 1996, Minnegasco established a forward looking plan to meet the growth needs of its customers in various counties in Minnesota for the 1999-2000 winter heating season. Minnegasco determined that the most efficient course of action was to contract for incremental capacity from Northern. I To implement its 1996 plan, Minnegasco prudently acquired the necessary capacity and assumed the underlying financial obligations to Northern to meet firm customer requirements for the 1999-2000 heating season. Minnegasco and Northern executed the contract for such capaci ty in 1997. An expedited certificate permitting Northern to begin construction promptly ?n the first phase of the Elk River Project is necessary to avoid a capacity shortfall for Minnegasco. As Minnegasco has advised the Commission several times in this proceeding, Mi~egasco will lack the necessary peak day pipeline capacity required to supply all of its firm customers during the 1999-2000 winter heating season if the Commission refuses to permit Northern to expand its capacity by means of the Elk River Project. Minnegasco estimates that its system needs could exceed capacity by as much as 2,200 Mcf on a peak day in the areas anticipated to be served by this expansion. This shortfall would potentially affect supplies to eleven towns on Minnegasco's system located on the Elk River Branchline downstream of the town border station called Anoka #1 and further west on Northern's Watkins Branchline. Northern's PeakDay 2000 project. - 3 - The longer Northern must wait for a certificate and delay the start of construction, the greater the risk that Minnegasco's load requirements will exceed the capabilities of Northern to provide the needed service. Historical weather patterns for the Minneapolis area show that system peak days may occur on Minnegasco's system as early as the first week in December. Northern's construction schedule is already extremely tight. If the Commission fails to issue the certificate by September 20, 1999, as requested by Northern, or shortly thereafter, there exists the alarming prospect that construction will not be completed by December 1, 1999. By its Request, Northern has now advised the Commission that, if Northern is permitted to proceed with the construction ofthe six miles of l6-inch pipeline between milepost 8.48 and milepost 14.7, Northern will be able to meet Minnegasco's requirements for the 1999-2000 heating season. Northern further advised the Commission that Northern "would follow the , construction procedures and mitigation measures described in its original application, supplements, and responses to staff data requests during the construction oftht subject facilities." Given Minnegasco's undisputed need for the capacity and the assurances provided by Northern as to environmental concerns, Minnegasco urges the Commission to review the Request and issued the requested certificate as expeditiously as possible. A capacity shortfall is not a situation that should be ignored and Northern has offered an acceptable interim solution. -4- Conclusion For the foregoing reasons, Minnegasco asks the Commission to issue an expedited certificate permitting Northern to proceed immediately with the construction of the designated six miles of Elk River Project. Respectfully submitted, RELIANT ENERGY MINNEGASCO, A DIVISION OF RELIANT ENERGY RESOURCES, INC. By September 10, 1999 .. , ~'! ' ~a ,i', :', > I n''; ,Ii '0': ..", ..,{ .. ".. '0 ..i" ! Z <~~:Z ", ~ :' rrJ :~ ~ '~,,() '0 "'-; ~'O ~:, )~"-" . -; ~,., I . ...... ~k~" . ~ , ' .,.',"'~#:,...!.' 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( " -, ./ I. ; ", , ~ ~ \~~ ~..... ;,v'1(!-' '\ ~:::: ,.~" i ., ! w .... :'~"i lO CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: September 21. 1999 AGENDA SECTION ORIGINATING DEPARTMENT ADD ON - Discussion Community Development ITEM NO. David 1. Carlberg Community Development Director Approve Resolution Order for Abatement 3994 146th Lane NW The City Council is requested to declare the single family dwelling located on the property at 3994 - 146th Lane NW to be a hazardous and substandard building, and order the abatement of said nuisance. Attached is a resolution and order of abatement for Council review and adoption citing the reasons. Bill Hawkins, City Attorney and David Almgren, Building Official, will be present at the meeting to address any questions or concerns of the City Council. Attached is the background information on the requested abatement for Council review. LAW OFFICES OF William G. Hawkins and Associates WILLIAM G. HAWKIN, BARRY A. SULLIVAN Legal Assistant TAMMI J. UVEGES 2J40 FOURTH AVENUE NORlI-: ANOKA, MINNESOTA 55303 PHONE (612) 427-8877 FAX (612) 421-4213 September 13, 1999 Mr. Richard Fursman City of Andover 1685 Crosstown Boulevard NW Andover, MN 55304 Re: 3994 - 146th Lane NW Dear Dick: Enclosed herewith please find copies of letters that I sent to the property owner, persons in occupancy, mortgage companies and other lien holders of the above- referenced property advising them that they must vacate the premises and obtain an certificate of occupancy by October 1, 1999. I have also notified them that we are petitioning the City Council to issue an order for abatement. By way of background, the original building permit was issued on November 12, 1996 to Wayne Bruner. A fire occurred during construction which was later determined to be arson. On August 25, 1998, Ed Septon, CEO of First Rate Mortgage Group, renewed the building permit. According to County records, a deed was given to Jeffrey Gackstetter conveying title to him on October 9, 1998. Two mortgages and several mechanic's liens have been filed against the property. The property is currently occupied by Ms. Starr Kalanges and five children. No certificate of occupancy has ever been issued by the City. It is not clear how the property was conveyed and mortgages obtained without a certificate of occupancy. The building department has tried without success to bring the property into compliance. The house has been the subject of numerous police reports in the last year or so. Several neighbors have contacted the City and this office to complain about the home and its occupants. Ms. Kalanges does not have an ownership interest of record and it is not clear what her relationship to the property is at this time. The City of Andover has adopted the Minnesota Uniform Building Code. Section 109.1 of the USC prohibits property from being used or occupied without a certificate of occupancy. Minnesota Rule 1305.0102 (1998) which implements the UBC authorizes municipalities to abate unsafe structures under Minn. Stat. ~ 463.15- 463.26. The procedure for abatement under the statutes is as follows: the City Council declares the property to be a hazardous or substandard building and orders an abatement. The order is served upon all owners of record, tenants and lien holders of Mr. Fichard Fursman Sep'wmber 13, 1999 Page Two recorj. Those persons have 20 days to respond ta the order. If they fa!1 to respond then the City can apply to the district court for a default judgment. If someone responds and contests the order then the matter is brought to the court for a resolution. The costs incurred by the City for going through the abatement process can be assessed against the property by the City Council in the manner of a special assessment. I am requesting that this issue be placed on the agenda at the next Andover City Council meeting scheduled for September 21, 1999. Enclosed herewith please find a proposed Resolution and Order for Abatement. My suggestion is that you request that Dave Almgren provide some supplemental information for presentation to the Council at that time. Mr. Hawkins will be prepared to present the matter at the time of the City Council meeting. hank you for your attention to this matter. If you require additional information, lease feel free to call. ours very truly, ! an RESOLUTION AND OROER FOR ABATEMENT CITY OF ANDOVER COUNTY OF ANOKA STATE OF MINNESOTA IN THE MATTER OF THE hazardous and substandard building located at 3994 146th Lane NW in the City of Andover, Anoka County, Minnesota, and !egally described as Lot 27, Block 1, The Meadows of Round Lake, Anoka County, Minnesota. 1. Pursuant to Minn. Stat. ~ 463.15 through ~ 463.261 (1998), the City Council of the City of Andover, having duly considered the matter, finds the above- described building to be a hazardous and substandard building for the following reasons: a. No certificate of occupancy has been issued by the City of Andover as required by City Ordinance; b. The property is currently occupied and utilized as a private residence. c. The Minnesota Building Code, as adopted by Andover City Ordinance, prohibits persons from using or occupying a structure without a certificate of occupancy issued by the City; d. Minnesota Rule 1305.0102 (1998) authorizes the City to abate unsafe buildings pursuant to the above-referenced Minnesota Statutes; e. The City has not been able to perform a final inspection and determination of fitness for occupancy; f. The premises is currently occupied by a family which includes five children; g. Occupancy of a place of residence without benefit of final inspection and certificate of occupancy constitutes a hazard to public safety. 2. Pursuant to the foregoing findings and in accordance with Minn. Stat. ~ ~ 463.15 through 463.261, the City Council hereby orders the record owners of the 1 Jremises, their represe:1tatives, all persons in interests, and all pers.::l1S in possession, :0 abate, correct and >'emove the hazardous and substandard condition by vacating '(he premises forthwith, by ceasing to use the premises as a place of residence and to ;Jrovide for proper inspections by the City and the acquisition of a certificate of occupancy, all within twenty (20) days of the service of this order. The Council further orders that all personal property and fixtures that may unreasonably interfere with the abatement, correction and removal of the hazardous and substandard condition shall be removed within twenty (20) days. If not so removed, the City of Andover may remove such property, fixtures and, at its option, store or dispose of such property at public auction in accordance with Minnesota Law. 3. The City Council further orders that unless all such corrective action is taken or answer served upon the attorney for the City of Andover within twenty (20) days from the service of this order, a motion for summary enforcement of this order will be made to the district court of Anoka County. 4. The City Council further orders that if the City is compelled to take any corrective action herein, all necessary costs expended by the City will be assessed against the real estate concerned and collected in accordance with Minn. Stat. ~ 463.22 (1998). 5. The City Administrator, City Clerk, City Attorney, Anoka County Sheriff, and any officers and employees of the City and Anoka County Sheriff are authorized and directed to take such action, prepare, sign and serve such papers as are necessary to comply with this order and to assess the cost thereof against the real estate described above for collection along with the tax. 6. The Council further orders that if the terms of this order and any 2 resulting judgrT;ent issued by the district court are not fully ,:omplied with in the time prescribed, thf' City shall cause the building to be repaired and the hazardous or substandard condition corrected and abated, if possible. If ,10t possible, the building shall be razed .:>r removed or the City may acquire the building and the real estate by eminent domain as provided in Minn. Stat. ~ 463.152. Adopted by the City Council this 1999. day of Mayor City Clerk 3 LAW OffiCES OF Willi,lm G. Hawkb:ls and Associll tes WilLIAM G. HAWKINS BARRY A. SULLIVAN Legal As,,-i, lanl TAMMI J. UVEGES 2140 FOURTH AHNUE NORTH ANOKA. MINNEWTA 55303 PHONE (612) 427-8877 FAX (612) 421-4213 Septemoer 14, 1999 Starr Kalanges 3994 - 146'" Lane NW Andover, MN 55304 Re: 3994 - 146'" Lane NW, Andover, Minnesota Dear Ms. Kalanges: Please be advised that this office is the City Attorney for the City of Andover. It has come to my attention that you and your family occupy and reside at the above- referenced address. No certificate of occupancy has ever been issued for this home. It is a violation of Minnesota Law and Andover City Ordinances to occupy a premises without a certificate of occupancy. This is to notify you that unless a certificate of occupancy is obtained immediately, you must vacate the premises forthwith. If by October 1, 1999 you have not vacated the premises or no certificate of occupancy has been issued, I will bring an action against you and other interested persons in Anoka County District Court to have you removed from the property and to authorize the City to take any other action necessary to abate this nuisance. This requires your immediate attention. If you desire assistance in moving and finding alternative housing, please feel free to contact Anoka County Workforce Center, Family Intake, 1201 89'" Avenue NE, 4'" Floor, Blaine, Minnesota 55434, telephone (612) 717-7731 who will be happy to provide assistance to you. If you need information about the process of obtaining a certificate of occupancy, you should contact Building Inspector David Almgren at 755-5100 and he can assist you. T nk you of your attention to this matter. If you have any questions, please call. I erely , tju Richard Fursman Dave Almgren LAW Orncrs OF William G. J-Jawkins and A.~sociates WILLIAM G. HAWKINS BARRY A. SULLIVAN Le;.:aJ Assistant TAMMI J. UVEGES 2140 FOURTH AVENUE NORTH ANO'(A, MINNESOTA 55303 P!-:ONE (612) 427-8877 FAX (612) 421-4213 September 14, 1999 Jeff Gackstetter 277 Coon Rapids Boulevard Suite 212 Coon Rapids, MN 55433 Re: 3994 - 146th Lane NW, Andover, Minnesota Dear Mr. Gackstetter: Please be advised that this is the office of the Andover City Attorney. Documents filed with the Anoka County Recorder identify you as the fee owner of the above- referenced property. It has come to my attention that the home has been occupied by a family for some time. No certificate of occupancy has ever been issued by the City for this property. It is a violation of Minnesota Law and Andover City Ordinance for anyone to occupy a home without a certificate of occupancy. The purpose of this letter is to advise you that the property must be vacated immediately and may not be used as a place of residence until a certificate of occupancy is obtained. If by October 1, 1999 the premises have not been vacated or a certificate of occupancy issued, I shall bring an action in Anoka County District Court against you and all other interested persons requiring that the property be vacated and authorizing the City to take such other action as is necessary against the property to abate this nuisance. The City Council will be requested to issue an Order for Abatement at its next regular meeting scheduled for September 21, 1999. This matter requires your immediate attention. If you have any questions or wish to dinUSS this matter further, please call. Sin;cerely, \ , BA /tju cc:1 Richard Fursman Dave Almgren LAW OFFICES OF Willialn G. Hawkins and Associatfs WilLIAM G. HAWKINS BARRY A. SULLIVAN Legal Assisl~n' TAMMI J. V'/EGES 2140 FOURTH A VEM E NORTH ANOKA, MINNESOl A 55303 PHONE (612) 427-8877 FAX (612) 421-4213 September 14, 1999 Ed Septon CEO First Rate Mortgage Group, Ltd. 277 Coon Rapids Boulevard Suite 212 Coon Rapids, MN 55433 Re: 3994 - 146th Lane NW, Andover, Minnesota Dear Mr. Septon: Please be advised that this is the office of the Andover City Attorney. On August 25, 1998 you renewed a building permit for the above-referenced address. It has come to my attention that persons have been occupying the home for some time and that no certificate of occupancy for the property was ever issued by the City. It is a violation of Minnesota Law and Andover City Ordinances for persons to occupy a residence without a certificate of occupancy. I have notified the persons in possession of the property and the owner of record that the property must be vacated immediately. If the premises have not been vacated or a certificate of occupancy issued by October 1, 1999, I shall bring an action in district court to vacate the premises and authorizing the City to take such action as is necessary against the property to abate this nuisance. The City Council will be requested to issue an Order for Abatement at its next regular meeting scheduled for September 21, 1999. If you have any questions, please feel /tju \. Richard Fursman Dave Almgren CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW, . ANDOVER. MINNESOTA 55304 . (612) 755-5100 To: Bill Hawkins Date: May 19,1999 From: David Almgren Re: 3994-146th Lane NW. In reference to 3994-146th Lane NW., arson house fire, rebuilt by Ed Septon, First Rate Mortgage Group. Background on this house, original building permit was issued November 12,1996 to Wayne Bruner, During construction, there was a fire on June 5, 1997, which was later proved to be set by the owner. On August 25, 1998 Ed Septon CEO. Of First Rate Mortgage Gr~up, came in and renewed the building permit at one half the original permit price, The items to be corrected and completed for the issuance of a Certificate of Occupancy are as follows, . Sheetrock . Final Plumbing Inspection .. Final Inspection on Building . As Built Survey . Grading I Grading Inspection . Boulevard Sod , The above required items and inspections were noted to Ed Septon at the time of permit renewal. Since the time of permit renewal, we have not received any calls for inspections at the property. I have made several attemps at contacting Ed Septon to get the job done, below is a list of dates. . August 28,1998, needing a license, needs to pay the hook-up charge for a water meter. . January 14, 1999, Left message . February 4, 1999, Left Message . February 16, 1999, Left Message . March 6, 1999, sent a Certified letter to Ed Septon. . March 16, 1999, Called to check the status of the requests, of the Certified letter. His response was that he is working on it. 1 / /~/~/ . March 23, 1999, Ed Septon called to inform us that he is working on getting the final plumbing tested, Apparently Ed Septon closed on this house October 9, 1998, The lender did not ask for a copy of the Certificate of Occupancy, therefore there was not a copy at the closing. See enclosed Warranty Deed issued to Jeffrey Gackstetter and World Savings, on October 9,1998. This was acknowledged by Ed Septon president of Interum Fund, Inc. In addition, to the best of our knowledge the owner Jeffrey Gackstetter, is employed by Ed Septon. A deck was constructed onto the back of the house this spring, without our knowledge, no plans or permit came to our office our left our office. We also received a phone call yesterday, May 18,1999, from a neighbor of property 3994-146th Lane NW., in regard to the fact that the house was being sold to a woman, with children. Violations would include but are not limited too, Local Ordinance No. 19 Adopting the MN. State Building Code. The violation of allowing a person to occupy a structure without a final plumbing inspection. The violation of allowing a person to occupy a structure without a final building inspection. Ed Septon needs to be made aware of his responsibility to complete all of the required inspections. And be made aware that he is in violation of the Building Code, by allowing someone to move into a structure prior to a building final inspection, and the lack of having in his presence a Certificate of Occupancy. In addition suffer the misdemeanor consequences associated with such. Sincerely, jL;;J ft.7~ - David Almgren Building Official DNko Enclosures 2 ~ .'. ,~ LAW OffiCES OF William G. Hawkins and Associates WilLIAM G. HAWKINS BARRY A. SULLIVAN 1.l'.<.:.ul.-hsisIUfI/ T-\MMI J. UVEGES 2140 FOURTH AVENUE NORTH ANOKA. MI~INESOTA 55303 PHONE (612) 427-8877 FAX (612) 421-4213 May 24, 1 999 Mr. Ed Septon First Rate Mortgage Group 277 Coon Rapids Boulevard Suite 212 Coon Rapids, MN 55433 Re: 3994 - 146th Lane NW, Andover, Minnesota Dear Mr. Septon: I am writing as the Andover City Attorney concerning information I have received from the City Building Official that you are in violation of Ordinance 19 and the Minnesota State Building Code concerning construction activities which took' place at the residence located at 3994 146th Lane NW in the City of Andover. The items that you have not completed are failure to have inspections for sheetrocking, plumbing, grading and a final building inspection. Furthermore, you did not provide an as-built survey and complete the boulevard sodding. In spite of the fact that these items were not approved by the Andover Building Department, you sold the property to Jeffrey Gackstetter on October 9, 1998. This letter is to advise you that unless you contact the Andover Building Department and have these inspections and work completed on the structure, if necessary, within ten (10) days, I will commence a criminal prosecution of you for violation of the local ordinance and the State Building Code. You should be aware that each violation is a separate criminal matter and carries a penalty of a maximum of a $700 fine and 90 days in jail for each offense. ~ I Ifll~ w~am G. Hawkins Andover City Attorney WGH/tju cc: Dave Almgren, Andover Building Official J9 15:45 LA.oJ CFFlCES 2140 4TH ~ ~ 755 8923 t-O.184 002 -. -- June 7, 1999 Mr. William G. Hawkins Andover City AtI.omey 2140 Fourth Ave North Anoka. MN 55303 Response Via Fax and Mal. Re: Letter dated May 24111 mailed May 26111. 1999 (ee attached). 3994 14&h Lane mI, Andover, Minnesota. Dear Mr. Hawkins; I am resoonding to yOUr letter of the above d~(s). Returning from out of town and into the office this a.m., I received the same. FtrSUy, FtI'St Rate Mortgage Group, nor Ed Septon individually, neither owned nor had an interest in this p~perty. FII'St Rate did however broker the mortgage on the property for Mr. Jeff Gackstetter. It is our understanding that the wont done on said property was contractecllt1rough Sond Oak Construction Corp. This was done at the insistence of the City as they required a licensed building contractor to complete any walt Solid Oak has not completed nor performed according to their aQI eement in spite of the fact they have been fullY compen:sated for all wor1t However, we wiH be happy to work wtth you and the city 10 resolve tnese issues. Please ad . e how you would like us to continue. P c./CEO First Rate Mortgage Group, Ltd. 277 Cuon Rdp'd. Bh.d. SHire 2J~ C""" Rupicls,.:\1N ;;-13; 611.7114.15314 c512.i!l4.!XHX) {"" //. CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW. . ANDOVER, MINNESOTA 55304 . (612) 755-5100 Date: July 22,1999 To: Bill Hawkins From: David Almgren Re: History of structure @3994-146thLaneNW. The original building permit was issued on November 12, 1996 to Wayne Bruner. . The , following is a list of inspections requested by Wayne'Brunerto date, done,on the 'proPertY at 3994-146th Lane NW. . Footing 11/22/96 . Foundation 12/03/96 . Sewer & Water 12/04/96 . . Rough Plumbing 01/22/97 . Sheathing 02/12/97 . Framing 04/21/97 . Insulation 04/30/97 . Sheetrock 04/30/97 On Thursday night June 5, 1997 this house caught fire which was later proven to be arson set by owner, Wayne Bruner. On August 25, 1998 Mr. Ed Septon C.E.O. of First Rate Mortgage Group came in to renew the building permit for 3994-146th Lane NW. This cost Mr. Septon $636.13 which is ~ of the original permit price, check #24638. At that time I told Mr. Septon that he needed a State Licensed Contractor to fInish the house. It is my understanding that Mr. Septon hired David Francen, DBA, Solid Oak Construction, to finish the work on the house. 1 /' /' The inspections required to finish the house, (listed below) were not called for, therefore there was no final building inspection which is required for occupancy. . Final Plumbing . Final Mechanical . Final Electrical . Final House . Final Grade . As Built Survey Please refer to the letter to you dated May 19, 1999 for details and messages, etc. On June 7, 1999 at 11 :40am I talked to Ed Septon he said he has a plumber finishing up the work and will take care ofiterns. To date none of the items have been taken care of. Bill we are getting a lot of calls from neighbors about this property, we have to do something. Sincerely, ~4~7~ / David Almgren Buildmg Official DAlko 2 --- LAW OffiCES OF William G. Hawkins and Associates WILLIAM G. HAWKINS BARRY A. SULLIVAN Legal Assislant TAMMI J. UVEGES 2140 FOURTH A VENUE NORTH ANOKA. MINNESOTA 55303 PHONE (612) 427-8877 FAX (612) 421-4213 August 12, 1999 Mr. Dave Almgren Mr. Jeff Johnson City of Andover Building & Planning Department 1685 Crosstown Boulevard NW Andover, MN 55304 Re: 3994 146'1\ Lane NW Dear Dave and Jeff: I received a phone call from a neighbor of the above-referenced address who called to complain about the problems that had been occurring for some time with the occupants of this house. We had understood that there may be building permit violations but we were not aware that the property was occupied unlawfully and that there was an ongoing neighborhood problem. I would like to know the status of the property. I am requesting that you conduct an inspection of the property for building/zoning code violations as soon as possible. I am requesting that the property owners voluntarily comply with the inspection. If they refuse to do so, no inspection should occur. However, you should immediately contact me and I will obtain an administrative search warrant which will allow us to enter the property and inspect with or without the property owner's consent. You should contact the Sheriff's Office and request that an Andover deputy assist in the initial inspection as an escort. I would like to receive the results of this inspection as soon as possible so I can decide what steps to take next. Again, if they refuse to allow the inspection, or if no one is home, please advise and I will seek an administrative search warrant. I am also requesting that you provide me with a copy of the original building permit that was issued to Mr. Bruner on November 12, 1996 and the renewed building permit issued to Mr. Septon on August 25, 1998. We ... . Mr. Dave Almgren Mr. Jeff Johnson August 12, 1999 Page 2 contacted Mr. Septon and he indicated that he had no ownership interest in this property. It is not clear to me who owns the property or who is occupying the property. Thank you or your prompt attention to this matter. V-' Memorandum DATE: August 24, 1999 TO: Barry Sullivan FROM: David Almgren RE: 3994-146th Lane NW. PIN: 30-32-24-14-0016 On Monday August 16,1999 @ 1 1:30am, Jeff Johnson Zoning Administrator, Deputy Jorgenson and myself David Almgren Building Official, made an inspection of the above stated property. The following was found not in compliance with City Codes. . Grading is not complete and as built grading plan not complete, . Boulevard sodding not complete, weeds and sandburrs growing. . House does not have required smoke detectors and those that are there need replacement or repair. . Need door closure on door between house and garage, . Need fmal plumbing test complete and, completed by a licensed plumber. . Need permit for existing deck. . Need Certificate of Occupancy when all items are finaled, *Note: Final electrical inspection took place on July 21,1999. Thank You, tJ4~ David Almgrem DAlko Enclosures CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: SePtember 2 t. t 999 AGENDA SECTION ORIGINATING DEPARTMENT ADD-ON ITEM Administration Richard Fursman ITEM NO. Joint Meeting with City of Ramsey REOUEST: The Ramsey City Council has requested a joint meeting with the Andover City Council on September 30, at 5:30 p.m., at the Andover City Hall, with a box lunch provided. The 5:30 p.m. meeting is in lieu of the 7:00 p.m. meeting scheduled at the City of Ramsey. The topic of discussion would be the Comprehensive Plan. CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: SePtember 2 1. 1 999 AGENDA SECTION ADD-ON ITEM - 23 ORIGINATING DEPARTMENT ITEM NO. 23 Approve Hire/Public Works Maintenance Supervisor Administration Richard Fursman REOUEST: The City Council is requested to consider the appointment or the contingent appointment of Jeff Okerstrom as the Street Supervisor. Jeffhas been with the City for four years and has an excellent work record. He is anticipated to represent the City and his department in a professional enthusiastic way. I wish to advise the Council that six individuals from public works participated in the process, and all did an excellent job. The process was difficult, yet encouraging and informative. CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DATE: Seotember 21. 1999 AGENDA SECTION ADD-ON ITEM ORIGINATING DEPARTMENT' Administration Richard Fursman ITEM NO. Joint Meeting with City of Ramsey REOUEST: The Ramsey City Council has requested a joint meeting with the Andover City Council on September 30, at 5:30 p.m., at the Andover City Hall, with a box lunch provided. The 5:30 p.m. meeting is in lieu of the 7:00 p.m. meeting scheduled at the City of Ramsey. The topic of discussion would be the Comprehensive Plan. ,-- DATE September 21. 1999 D~ffi~ ITEMS GIVEN TO THE CITY COUNCIL . Park and Recreation Commission Minutes - September 2, 1999 . City Council Minutes - September 7, 1999 . August 1999 Monthly Building Report . Improvement Bonds 1999 . Schedule of Bills .. .'. "II~~IIII : ,i '~:r!\~ <' (, ' " , [ ii!: '/1::." . , . " I I IJ) J " ./: ,1',:'[.' i'!Hr ;'..i,:;;~' " , " TO: Mayor and City Council /''i V .. ..J 1: !;: : .I;~, 1 i,::I:; ~ 1m" :;'fi",..;'" i " ':, I{.t;~: , FROM: David Almgren I 't7 :-';l;i,:l:!:':.l:(";: nrYrr: ;;:-j:!;~ f<: : ! :.', ~ : , RE: 1999 Monthly Building Report Auaust", it ii: ,1:.:: .i:': , ;, ',:' ,,'< [,::,',,::,. :!? . BUILDING PERMITS ' ,'.,' i ",' .,' .," "i' ~\ ,!if: ' , , . PermiVPlan Tax' ":.." ':i Total Valuation 38 Residential 30 SIW 8 Septic $ '59,726.65 $ 2,170.00 $ 61,896.65 $ 4,342,000.00 3 Additions $ 382.39 $ 4.80 $ , 387.19 $ 9,600.00 8 Garages $ 1,723.01 $ '29.85 $ 1,752.86 $ 59,700.00 4 Remodeling/Finishing $ 655.67 $ 12.80 $ 668.47 $ 24,600.00 Commercial Building $ - Pole Bldgs/Bams ' : $ - 1 Sheds I I $ 62.25 $ , 1.00 $ , 63,25 $ 2,000.00 3 Swimming Pools $ 345.50 $ 9.35 $ , , 354,85 $ 18,669.00 Chimney/Stove/Fireplace $ - : $ . - '. Structural Changes " , $ - 30 Porches/Decks I $ 3,329.41 $ , . 51.65 $ 3,381,06 $ 102,480,00 Repair Fire Damage .... " ' $ - 20 Re-Roof $ 1,552.33 $" , 61.33 $ , 1,613,66 $ 122,057.00 4 Other $ 60.00 $ I' " 2.00 $ 62.00 $ 2,000.00 1 Commercial Plumbing $285,37 $' , 5.28 $ 290.65 $ 10,567.00 112 SUBTOTAL $ 68,122.58 $ , 2,348.06 $ 70,470,64 $ 4,693,673.00 , ' , " PERMITS ' , FEES COLLECTED 112 Building Permits $ 68,122.58 $ 2,348.06 $ , 70,470.64 Ag Building ,,'. . $ - Curb Cut ' Ii $ - , Demolition $ - Footing $ - Renewal $ - Moving ',' $ - 54 Heating $ 1,820.00 $ " 27.00 $ 1,847.00 Heating Repair , I '. ' " $ - . 31 Hook Up $ 775.00 $ " 15.50 $ 790.50 52 Plumbing $ 6,424.00 $ :28.00 $ 6,450.00 18 Plumbing Repair $ 296.00 $ , 9.00 $ 305.00 , 10 Pumping 1 $ 30.00 , $ 30.00 2 Septic I $ 70.00 $ " 1.00 $ 71.00 4 Septic Repair $ 140.00 $ . 2.00 $ 142.00 31 Water Meter $ . 1,550.00 $ 15.50 $ 1,565.50 40 Certificates of Occupancy $ 160.00 $ 160.00 8 Contractor's License I $ 200,00 $ 200.00 38 License Verification Fee $ 190.00 $ 190.00 1 Health Authority I $ 5.00 " $ 5.00 31 Sewer Admin. Fee $ 465.00 . ',',\ $ 465.00 31 SAC Retainage Fee $ 325.50 , , : $ 325.50 7 Reinspection Fee $ 294.00 " -'.1 $ 294.00 16 Rental License $ 800.00 " . ,'" ," $ , 800.00 38 Fireplaces $ 1,680.00 $ 19.00 $ 1,699.00 524 TOTALS $ 83,347.08 $ 2,463.06 $ 85,810.14 , . Total Number of Homes YTD 1999 , 303 Total Number of Homes YTD 1998 -.:/ 309 Total ValuationYTD -I 1999 :', " $ , 40,644,483.00 Total Valuation YTD -I 1998 " . $ 49,418,162.00 Total Building Department Income YTD- 1999 , $ 674,099.27 Total Building Department Income YTD- 1998 , $ 827,658.62 I Standard & Poors' Rating: _ I J Preliminary Official Statement (Dated September 3, 1999) J City of Andover, Minnesota (Anoka County) I , $3,525,000 General Obligation Improvement Bonds of 1999 Interest Payable: 6-1~ and !IP.II1iAnnnany thereafter Call Option: 12-1-01 @ 100 J , REGISTRATlONIBOOK ENTRY: This offering will be issued as fully registered Bonds and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York, to which principal and interest payments on the Bonds will be made. Individual purchases will be made in book-entry form only, in the principal amount of $5,000 or any whole multiple thereof Purchasers of Bonds will not receive physical delivery of bond certificates. Please see "Book-Entry Only System" herein for additional information. J J DATE, TIME and PLACE of BID OPENING DATE, TIME and PLACE of AWARD , Tuesday, September 21, 1999 11:00 a.m., Central Time Juran & Moody, a division of Miller, Johnson & Kuehn, Incorporated 1100 Minnesota World Trade Center St. Paul, Minnesota 55101 In the opinion of Briggs and Morgan, Professional Association, Bond Counsel, based on present federal and Minnesota laws, regulations, rulings and decisions, at the time of their iSSUllllCe and delivery to the original purcIwIer. interest on the bonds is excluded from gross m-ne for p1IIpClSl:S of United States iIK:omc: tax and is excluded, to the same extent in computing both gross income and taxable net income for purposes of Slate of Minnesota income tax (other than Minnesota fianchise taxes measured by m-ne and imposed lIIl corporations and fiIIancial institutions). Interest on the bonds is not an item of tax preference for purposes of the a1ten1l1bve minimum tax imposed 011 individuals 811d corporations; however, interest on the bonds is taken into IICCOWlt in detamining lIl!iustcd l:lUIQIt eamiDgs for p1IIpClSl:S of computing the federal alternative minimum tax imposed on corporations. No opinion will be expr = sse ~ by Bond Counsel regarding othCl' state or federal tax consequences caused by the receipt or acc:rual of inlal:st on the bonds or arising with respect to ownership of the bonds. See "Tax Exemption and Other Tax Considerations" herein. Tuesday, September 21,1999 7:00 p.m., Central Time City Hall 1685 Crosstown Boulevard Northwest Andover, Minnesota 55304 J , J 11 J lURAN Be MOODY A DMllION orMiiiD. JOHNsoN.. JOXI2JlH,INOOIrO&.mID INVBSTMENT SBClJllITIBS SINC8 19119 MU.J..ER, JOHNSON & KUEHN, INCORPORATED I N v F. S T MEN TS B CUll. I TIn S .J J .., ...j .., u .., ...j .., LJ .., --J .., w .., u .., LJ .., w .., u .., u .., u .., u .., LJ .., --J .., -.J --, -.J ., .J -, .J TABLE OF CONTENTS Page Summary of Offering,...... ..............,.. ..........,....,.,....,.....,.........,...."....,.. ;..........".............,..........., 2 Principal City Officials .............................,....,.,....,.,.......,............."...........,......,..,...................,... 3 Issuer's Certificate.......,.......,.,...... .................,......,........,.. ...........,...,.............,.,..............,............ 4 Official Terms of Bond Sale........................................................................................................ 5 _ 10 Authority and Security for the Bonds.......................................................................................... 11 Purpose...............,...,.... ............,...... .....,..,....,.,.,..................,....,.....,.,..,......,....................,.,........,. II Statutory Debt Limit ............................,..,......,....,.......,.......,....,...."......,....,....,.................,...,...... 12 Estimated Source and Application of Funds ............................................................................... 13 Future Financing... ..............,......,......,...."......,....,..,.,...,....,....,....,.., .........,......,.......,.,.,.,...,.,.".,... 14 Bond Rating..........,............,.....,...,.........,..,.........,...., ...............,.........................,....,.................... 14 Litigation,...,.......... ........,......................."....,......,.......,.......,.....,.....,.,...........,...."..........,.,...,.,..,... 14 Certification..,......,........,..............,............,........,.............,.......,..............,....,.,.....,...,......,....."..... 14 Legality ..............,............,..............,............................,.........,....,.,...............,...,.....,.,....,...,........,. 14 Continuing Disclosure..,..................,......................,........,.,....,...............,......, ...........,.,.........,.,... 15 Y2K Issues.................... .......... ....................,......... .............,.........,............,.........................,.,...... 15 Book-Entry Only System.. .........................,.. .......,.. ......,......................,....,.,............,.,...............,. 16 Tax Exemption and Other Tax Considerations............................................................................ 17 _ 18 City of Andover (General Information)....................................................................................... 19 _ 25 Minnesota Valuations, Tax Credits and Levy Limitations.......................................................... 26 _ 28 City of Andover (Economic and Financial Information)............................................................. 29 _ 38 Summary of Debt and Debt Statistics.....,.....,......,..,.....,..,....,....,............,....,.......,......,.,.............. 39 Worksheet....... ,..................., ....... ....... ....."......,.......... ...,., ,.... ..........,.. ..... ..... .... ...,..,...... ...........,... 40 Proposal Form.........................................,......,.....................,.,.,........,......,.....................,.......,..... 41 Appendix A - Proposed Form of Legal Opinion Appendix B - Form of Continuing Disclosure Undertaking Appendix C - City's Financial Report n LJ SUMMARY OF OFFERING $3,525,000 GENERAL OBLIGATION IMPROVEMENT BONDS OF 1999 (Book-Entry Only) n LJ n AMOUNT - 53,525,000. ISSUER - City of Andover, Minnesota (the" City"). SALE DATE - Tuesday, September 21,1999. u n OPENING. 11 :00 A.M. Central Time, at Juran & Moody. a division of Miller. Johnson & Kuehn, Incorporated, 1100 Minnesota World Trade Center, 30 East Seventh Street, St. Paul, Minnesota 55101-4901, telephone: (651) 224-1500 or (800) 950-4666. AWARD _ 7:00 P.M., Central Time, at the Andover City Hall, 1685 Crosstown Boulevard Northwest, Andover, Minnesota 55304-2612. TYPE OF ISSUE _ General Obligation Improvement Bonds of 1999 (the" Bonds"). See Authority and Security for the Bonds and Estimated Source and Application of Funds for additional information. SECURITY & PURPOSE _ These Bonds arc being issued pursuant to Minnesota Statutes, Chapters 429 and 475. The Bonds arc payable primarily from special assessments against all benefited property. The full faith and credit of the City is pledged to their payment and the City has validly obligated itself to levy additional ad valorem taxes in the event of any deficiency in the Debt Service Account established for this issue. These taxes will be levied upon all of the taxable property within the City and without limitation of amount. Interest on the Bonds is excluded from gross income for United States income tax purposes and is excluded, to the same extent, from both gross income and taxable net income for State of Minnesota in- come tax purposes (other than Minnesota franchise taxes measured by income and imposed on corporations and financial institutions) and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations or the Minnesota alternative minimum tax applicable to individu- als, estates or trusts. In addition, the proceeds of the Bonds will be used to provide moneys for the financing of assessable improvements within the City, including but not limited to sanitary sewer and waler line connec- tions, storm sewer, streets, sidewalks, and curb & guner. LJ n LJ n LJ n u n LJ DATE OF ISSUE- October I, 1999. INTEREST PAYABLE DATES _ June 1,2000, and semiannually thereafter on December I and June I to registered owners of the Bonds appearing of record in the bond register as of the close of business on the fifteenth (15th) day (whether or not a business day) of the immediately preceding month. n LJ DENOMINATIONS - 55,000. MATURITIES - 12/01/00 5705,000 n 12/01/01 5705,000 12/01/02 5705,000 12/01103 5705,000 12/01/04 5705,000 LJ AVERAGE MATURITY - 3.16667 years. REDEMPTION FEATURE _ At the option of the Issuer, Bonds maturing after December 1,2001, shall be subject to prior payment on said date, and any interest payment date thereafter. at a price of par and accrued interest. Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the Bonds remaining unpaid which have the latest maturity date shall be prepaid first. If only part of the Bonds having a common maturity date are called for prepayment, the Issuer will notify DTe of the particular amount of such maturity to be prepaid. DTC will detennine by lot the amount of each par- ticipant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. Notice of such call shall be given by mailing a notice thereof by registered of oertified mail at least thirty (30) days prior to the date fixed for redemption to the registered owner of each Bond to be re- deemed at the address shown on the registered books. BOOK-ENTRY SYSTEM _ The Bonds will be issued as fully registered bonds and, when issued, will be registered in the name of Cede & Co., as nominee of the Depository Trust Company, New York. New York, to which principal and interest payments on the Bonds will be made. Individual purchases will be made in book-entry fonn only, in the principal amount of55,000 or any whole multiple thereof. Purchasers of the Bonds will not receive physical delivery of bonds. PAYING AGENTIREGISTRAR. U.S. Bank Trust National Association, St. Paul, Minnesota. METHOD OF SALE _ Sealed bids only, accompanied by a good faith deposit in the amount of570,500 at a price of not less than 53,489,750 plus ac- crued interest. See Official Terms of Bond Sale herein for additional information. r"' 'L r L r L r L TAX DESIGNATIONS - r NOT Private Activity Bonds _ These Bonds arc not" private activity bonds" as defined in ~14I of the Internal Revenue Code of 1986, as amended (the Code). Qualified Tax-ExemDt Obli.ations _ The Issuer will designate these Bonds" qualified w-exempt obligations" for purposes of ~265(b)(3) of the Code. LEGAL OPINION. Briggs and Morgan, Professional Association, St. Paul and Minneapolis, Minnesota (the" Bond Counsel"). RATING- The City has a general obligation bond rating of "A" by Standard & Poor's Corporation. The City will be applying to Standard & Poor's for a rating on this issue. L r L r ESTIMATED CLOSING DATE - October 21,1999. PRIMARY CONTACT - Richard Fursman, City Administrator, (612) 755-5100. Jean McGann, City Finance Director (612) 755-5100. Vicki Volk, City Clerk (612) 755-5100. Steven P. Manson, Vice President, Juran & Moody, (651) 224-1500 or (800) 950-4666. L ,. l -2- r l ..., '-.J ..., CITY OF ANDOVER L..J -, PRINCIPAL CITY OFFICIALS ....J Elected City Officials ..., ....J City Council Name Position ..., ....J Jack E, McKelvey Mayor Council Member Don Jacobson ..., ....J Julie Johnson Council Member ..., Mike Knight Council Member '-.J Ken Orttel Council Member ..., L.J ..., .....J Appointed City Officials City Administrator Richard Fursman ...., '-.J Jean McGann Finance Director ...., Victoria Volk City Clerk .....J Shirley Clinton William G, Hawkins and Associates- William G. Hawkins City Attorney City Treasurer ..., .....J Scott Erickson City Engineer ...., ....J ..., ....J Bond Counsel ...., ....J Briggs and Morgan, Professional Association St. Paul and Minneapolis, Minnesota -, ....J ..., Financial Advisor Juran & Moody a division oj Miller, Johnson & Kuehn, Incorporated St. Paul, Minnesota ....J -, J , -3- .J Term Exvires 01101101 01101103 01101103 01101101 01101101 n LJ n ISSUER'S CERTIFICATE LJ The City of Andover has retained the firm of Juran & Moody, St. Paul, Minnesota, to serve as financial advisor with respect to the securities being offered in this Official Statement. All statements contained herein, while not guaranteed, have been compiled from sources believed to be reliable in all material respects, n LJ Financial statements of the City are audited annually by an independent firm of certified public ac- countants, Excerpts from the financial statements for the year ended December 31, 1998, along with comparative December 31, 1997 figures, are included in this Official Statement and complete financial statements are available for inspection at the Andover City Hall as well as at the St. Paul office of Juran & Moody. n LJ n u The City of Andover has always promptly met all payments of principal and interest on its indebted- ness when due, r" u n u n LJ n L.; n LJ n NO FINAL OFFICIAL STATEMENT WILL BE PREPARED. THE ISSUER WILL PROVIDE THE SUCCESSFUL UNDERWRITER WITH AN ADDENDUM THA T TOGETHER WITH THIS PRELIMINARY OFFICIAL STA TEMENT WILL BE DEEMED THE FINAL OFFICIAL STATEMENT BY THE ISSUER. L r- L r L r L r L r L r L r THE DATE OF THIS OFFICIAL STATEMENT IS SEPTEMBER 3,1999, l -4- r l ..., c...J ..., c...J ..., c...J OFFICIAL TERMS OF BOND SALE ..., $3,525,000 GENERAL OBLIGATION IMPROVEMENT BONDS OF 1999 ...j ..., ....J CITY OF ANDOVER ANOKA COUNTY MINNESOTA -, ...j (Book Entry Only) .., NOTICE IS HEREBY GIVEN that these bonds will be offered for sale according to the following terms: ...j TIME AND PLACE: Sealed proposals will be opened by the City Clerk, or designee, on Tuesday, September 21, 1999, at 11:00 A.M., Central Time, at the offices of Juran & Moody, 1100 Minnesota World Trade Center, 30 East Seventh Street, in Saint Paul, Minnesota 55101-2091, Considera- tion of the proposals for award of the sale will be by the City Council at its meeting in the Andover City Hall beginning at 7:00 P.M., on the same day. ..., LJ ...., LJ ...., LJ ...., BOOK ENTRY SYSTEM: The bonds will be issued by means of a book entry system with no physical distribution of bond certificates made to the public. The bonds will be issued in fully registered form and one bond certificate, representing the aggregate principal amount of the bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the bonds, Individual purchases of the bonds may be made in the principal amount of $5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the Issuer through U.S. Bank Trust National Association, in St. Paul. Minnesota (the "Registrar") to DTC or its nominee as registered owner of ...j .., ....J ..., ....J .., , ~ ..., c...J -, ....J -, ....J 1076114. J -, J ., -5- J DATE OF ORIGINAL ISSUE OF BONDS: PURPOSE: INTEREST PAYMENTS: MATURITIES: REDEMPTION: 1076114.1 n LJ n the bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners, The successful proposal maker, as a condition of delivery of the bonds, will be required to deposit the bond certificates with DTC. The Issuer will pay reasonable and necessary charges for the services of the Registrar. LJ n LJ n LJ n u n u October 1, 1999. n G For the purpose of providing money to finance the construction of various improvements in the Issuer. n u June 1, 2000, and semiannually thereafter on June 1 and December 1 to registered owners of the bonds appearing of record in the bond register as of the close of business on the fifteenth (15th) day (whether or not a business day) of the immediately preceding month. n u n LJ December 1 in each of the years and amounts as follows: n 'L Year Amount r 2000-2004 $705,000 L All dates are inclusive, r Proposals for the bonds may contain a maturity schedule providing for any combination of serial bonds and term bonds, subject to mandatory redemption, so long as the amount of principal maturing or subject to mandatory redemption in each year conforms to the maturity schedule set forth above. L r r L At the ontion of the Issuer, bonds maturinq- after December 1, 2001, shall be subject to prior payment on said date, and any interest payment date r L r L r I.. -6- r L ..., o..J ..., o..J ..., thereafter, at a price of par and accrued interest. Redemption may be in whole or in part of the bonds subject to prepayment. If redemption is ~n part, the bonds remaining unpaid which have the latest maturity date shall be prepaid first, If only part of the bonds having a common maturity date are called for prepayment, the Issuer will notify DTC of the particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. Notice of such call shall be given by mailing a notice thereof by registered or certified mail at least thirty (30) days prior to the date fixed for redemption to the registered owner of each bond to be redeemed at the address shown on the registered books, ....j ..., ....J ..., ....J ..., ....j ..., ....j ..., LJ ..., LJ CUSIP NUMBERS: If the bonds qualify for assignment of CUSIP numbers such numbers will be printed on the bonds, but neither the failure to print such numbers on any bond nor any error with respect thereto shall constitute cause for a failure or refusal by the Purchaser thereof to accept delivery of and pay for the bonds in accordance with terms of the purchase contract. The CUSI? Service Bureau charge for the assignment of CUSIP identification numbers shall be paid by the Purchaser. ..., --.J ..., ....j ..., LJ ..., ....j DELIVERY: Forty days after award subject to approving legal opinion of Briggs and Moroan, Professional Association, of St. Paul and Minneapolis, Minnesota, Legal opinion will be paid by the Issuer and delivery will be anywhere in the continental United States without cost to the Purchaser at DTC, ..., ....j --, -..J , TYPE OF PROPOSAL: Sealed proposals of not less than $3,489,750 and accrued interest on the principal sum of $3,525,000 from date of original issue of the bonds to date of delivery must be filed with the -..J -, J 1076114.1 , J , -7- J n LJ n undersigned prior to the time of sale. Proposals must be unconditional except as to legality. A certified or cashier's check (the "Deposit") in the amount of $70,500, payable to the order of the Treasurer of the Issuer, or a Financial Surety Bond complying with the provisions below, must accompany each proposal, to be forfeited as liquidated damages if proposal maker fails to comply with accepted proposal. Proposals for the bonds should be delivered to Juran & Moody, and addressed to: LJ n u n u n u n LJ Shirley Clinton Treasurer Andover City Hall 1685 Crosstown Boulevard Northwest Andover, Minnesota 55304-2612 n LJ ,..., If a Financial Surety Bond is used, it must be from an insurance company licensed to issue such a bond in the State of Minnesota, and pre approved by the Issuer. Such bond must be submitted to Juran & Moody prior to the opening of the proposals. The Financial Surety Bond must identify each proposal maker whose Deposit is guaranteed by such Financial Surety Bond. If the bonds are awarded to a proposal maker using a Financial Surety Bond, then that purchaser is required to submit its Deposit to Juran & Moody in the form of a certified or cashier's check or wire transfer as instructed by Juran & Moody not later than 3:30 P.M., Central Time, on the next business day following the award. If such Deposit is not received by that time, the Financial Surety Bond may be drawn by the Issuer to satisfy the Deposit requirement. The Issuer will deposit the check of the purchaser, the amount of which will be deducted at settlement and no interest will accrue to the purchaser, In the event the purchaser fails to comply with the accepted proposal, said amount will be retained by the Issuer, No proposal can be withdrawn after the time set for receiving proposals unless the meeting u ,..., LJ n LJ r L r L r L r L r L r L r L 1076114.1 r t -8- ...., ...J ...., ...J ...., ...J .., RATES: -..J ...., --J ...., INFORMATION FROM PURCHASER: LJ .., LJ .., LJ QUALIFIED TAX EXEMPT OBLIGATIONS: ... LJ ...., CONTINUING DIS- CLOSURE UNDERTAKING: ...J ...., ...J ...., ...J ..., AWARD: ...J ..., ...J --, ..J .., j .., j 1076114 1 ~ .J , .J of the Issuer scheduled for award of the bonds is adjourned, recessed, or continued to another date without award of the bonds having been made, All rates must be in integral multiples of l/20th or l/8th of 1%. No limitation is placed upon the number of rates which may be used. All bonds of the same maturity must bear a single uniform rate from date of issue to maturity, The successful purchaser will be required to provide, in a timely manner, certain information relating to the initial offering price of the bonds necessary to compute the yield on the bonds pursuant to the provisions of the Internal Revenue Code of 1986, as amended. The Issuer will designate the bonds as qualified tax exempt obligations for purposes of Section 265 (b) (3) of the Internal Revenue Code of 1986, as amended. The Issuer will covenant in the resolution awarding the sale of the bonds and in a Continuing Disclosure Undertaking to provide, or cause to be provided, annual financial information, including audited financial statements of the Issuer, and notices of certain material events, as required by SEC Rule 15c2-12, Award will be made solely on the basis of lowest dollar interest cost, determined by addition of any discount to and deduction of any premium from the total interest on all bonds from their date to their stated maturity, -9- n LJ n LJ The Issuer reserves the right to reject any and all proposals, to waive informalities and to adjourn the sale. n u Dated: August 17, 1999. BY ORDER OF THE CITY COUNCIL /s/ Vicki Volk City Clerk n u n u Additional information may be obtained from: n LJ JURAN & MOODY 1100 Minnesota World Trade Center 30 East Seventh Street St. Paul, Minnesota 55101-2091 Telephone No. : (651) 224-1500 n u n u n LJ ,..., L< ,..... .L r L r L r L r L r L r L 1076114.1 -10- ...., u ...., w AUTHORITY AND SECURITY FOR THE BONDS ...., $3,525,000 General obligation Improvement Bonds of 1999 The Bonds are being issued pursuant to Minnesota Statutes, Chapters 429 and 475. At closing Bond Counsel will render an opinion that the Bonds are valid and binding general obligations of the City of Andover, Minnesota, The Bonds will be payable primarily from special assessments against all bene- fitted property. In addition, the full faith and credit of the City is pledged to their payment and the City has validly obligated itself to levy additional ad valorem taxes in the event of any deficiency in the Debt Service Account established for this issue, Further, these taxes will be levied upon all of the tax- able property within the City and without limitation of amount. Interest on the Bonds is excluded from gross income for United States income tax purposes and is excluded, to the same extent, from both gross income and taxable net income for State of Minnesota income tax purposes (other than Minnesota franchise taxes measured by income and imposed on corporations and financial institutions) and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations or the Minnesota alternative minimum tax applicable to individuals, es- tates or trusts. However, that for the purpose of computing the federal alternative minimum tax im- posed on corporation, such interest is taken into account in determining adjusted current earnings. See Appendix A - Proposed Form of Legal Opinion, .....J ...., u ...., .....J ...., .....J ...., LJ ...., PURPOSE L..J $3,525,000 General obligation Improvement Bonds of 1999 ,..., The purpose of the Bonds is to provide moneys for the financing of assessable improvements within the City, including but not limited to sanitary sewer and water line connections, storm sewer, streets, sidewalks, and curb & gutter, LJ ...., u ...., .....J ...., .....J ...., .....J ...., .....J ...., .J -, -.J -, -.J -, J -, -11- J n LJ STATUTORY DEBT L1MITI n Minnesota Statutes, 9 475.53, states that a city may not incur or be subject to a net debt in excess of two percent (2%) of its estimated market value, Net debt is, with limited exceptions, debt paid solely from ad valorem taxes, LJ n u Computation of Legal Debt Margin as of September 2, 1999, pl~s this issue: 1998/1999 Estimated Market Value Times 2% of Estimated Market Value n $1,069,426,500 x ,02 u Statutory Debt Limit Amount of debt applicable to debt limit: Total Bonded Debt (includes this issue) Less: General Obligation Improvement Bonds (includes this issue) General Obligation Tax Increment Bonds General Obligation Taxable Tax Increment Bonds General Obligation Crossover Refunding Bonds General Obligation Refunding Bonds Total debt applicable to debt limit Legal debt margin $ 21.388.530 n LJ n $ 28,905,000 ( 16,730,000) ( 9,200,000) ( 435,000) ( 600,000) ( 715.000) $ 1.225.000 $ 20,163.530 LJ n u n I..J n LJ n LJ ,.., .L.J ,.... L r L r L r L r L r L I Effective June 2,1997, and pursuant to Laws of Minnesota for 1997, Chapter 231, Section 33, any lease revenue or public project revenue bond issues/agreements, including certificates of participation, over $1,000,000 are subject to the statutory debt limit. Lease revenue, certificates of participation, or public project revenue bond issues/agreements under $1,000,000 are not subject to the statutory debt limit. r l - 12- r l ,.., u ..., ESTIMATED SOURCE AND APPLICATION OF FUNDS L.J $3,525,000 General Obligation Improvement Bonds of 1999 I. Source of Funds ..., LJ ..., General Obligation Improvement Bonds of 1999 II. Application of Funds Estimated Costs to be Financed: Project Costs Add Estimated Issuance Costs: [Bond counsel, paying agentlbond registrar (one time fee), bond rating fee and financial advisory services] Capitalized Interest (8 months) Discount Factor (1.000% of par) Total Issuance Costs $ 20,475 126,117 35.250 LJ ..., u ..., u ..., u ..., Subtotal LJ ..., Less: Estimated Construction Fund Earnings Estimated Contribution from City Par Amount of Bond Issue LJ ..., LJ ..., L.J ..., L.J ..., u ..., L.J ..., '-..J ..., L.J ..., ....J -, ....J .., - 13- ....J $3,369,100 181.842 $3,550,942 ( 25,268) ( 674) $3.525.000 $3525.000 n LJ FUTURE FINANCING n The City does not anticipate the need to finance any capital improvements/equipment with the issuance of general obligation bonds within the next two months, LJ n u n u BOND RATING n The City has a general obligation bond rating of" A" assigned by Standard & Poor's Corporation, The City will be applying to Standard & Poor's for a rating on this issue, u n u n u LITIGATION n On August 20, 1999, the City Attorney, William G, Hawkins and Associates, William G. Hawkins, has indicated that no litigation is pending or threatened that would jeopardize the creditworthiness of the City of Andover, Claims or other actions in which the City is a defendant are covered by insurance or of insignificant amounts, u n u n LJ n 'LJ CERTIFICATION The City will furnish, upon request, a statement to the effect that this Official Statement to the best of their knowledge and belief, as of the date of sale and the date of delivery, is true and correct in all ma- terial respects, and does not contain any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, n LJ r L r L r L LEGALITY Legal matters incident to the authorization and issuance of the Bonds are subject to the approving opinion of Bond Counsel as to validity and tax exemption. A copy of such opinion will be available at the time of the delivery of the Bonds, See Appendix A - Proposed Form of Legal Opinion. Bond Counsel has not participated in the preparation of this Official Statement and is not passing upon its accuracy, completeness or sufficiency, Bond Counsel has not examined, nor attempted to examine, or verify, any of the financial or statistical statements or data contained in this Official Statement, and will express no opinion with respect thereto. r L r L r L -14- r L ...., ..J CONTINUING DISCLOSURE ...., LJ In order to assist the Underwriters in complying with SEC Rule 15c2-12 (the "Rule"), pursuant to the Award Resolution and a Form of Continuing Disclosure Undertaking to be executed on behalf of the City on or before Bond Closing, the City has and will covenant (the" Undertaking") for the benefit of holders of the Bonds to provide certain financial information and operating data relating to the City to certain information repositories annually, and to provide notices of the occurrence of certain events enumerated in the Rule to certain information repositories or the Municipal Securities Rulemaking Board and to any state information depository, The specific nature of the Undertaking, as well as the information to be contained in the annual report or the notices of material events is set forth in the Form of Continuing Disclosure Undertaking in substantially the form attached hereto as Appendix B, The City has never failed to comply in all material respects with any previous undertakings under the Rule to provide annual reports or notices of material events. A failure by the City to comply with the Undertaking will not constitute an event of default on the Bonds (although holders will have an enforceable right to specific performance). Nevertheless, such a failure must be reported in accordance with the Rule and must be considered by any broker, dealer or municipal securities dealer before recommending the purchase or sale of the Bonds in the secondary market. Consequently, such a failure may adversely affect the transferability and liquidity of the Bonds and their market price, The Issuer will covenant in the resolution awarding the sale of the Bonds and in a Form of Continuing Disclosure Undertaking to provide, or cause to be provided, annual financial information, including audited financial statements of the Issuer, and notices of certain material events, as required by SEC Rule l5c2-l2, Please see Appendix B - Form of Continuing Disclosure Undertaking for further infor- mation regarding continuing disclosure for the City of Andover, Minnesota, .., LJ ...., LJ .., ..J .., .....J ..., LJ .., LJ .., ..J Y2KISSUES .., Many existing computer programs use only the last two digits to refer to a year, If not corrected, many computer applications could fail or create erroneous results, possibly affecting an organization's op- erations, financial condition, or ability to make timely payments on its indebtedness, The City of Andover is implementing guidelines established by the League of Minnesota Cities to address potential Y2K problems, A Y2K Task Force has been formed to address concerns and the City Council has alIo- cated $25,000 towards the purchase of new equipment and upgrades, The City has completed an initial assessment of equipment for Y2K vulnerability, Presently computer and digital equipment vendors are being contacted to identify and address Y2K problems, Y2K fixes will be implemented and tested over the summer. Jean McGann, Finance Director, is the designated coordinator for Y2K efforts, The Y2K issue may also affect other institutions directly or indirectly related to the program, including ensuring timely payment(s) of principal and interest on the Bonds, The Y2K issue may impact the Paying Agent and their ability to process payments, billings, fund and account activity and invest- ments, The Paying Agent's parent company, U,S, Bancorp, has allocated financial, teclmical and staffing resources to the year 2000 problem, They began the official Y2K assessment in 1996 with a team that now numbers 40 full-time staff working with hundreds of other employees across the organi- zation. The year 2000 strategic plan requires that the year 2000 upgrades for critical systems be sub- stantially completed by the end of 1998, leaving the entire year of 1999 for further modifications and testing. ...J .., :....J .., L.J .., L.J .., L.J .., ...J DTC is currently supporting Y2K testing, A home page on the Internet has been established at wv"w.dtc,org where notices and other information regarding DTC's Y2K project progress will be made available to the Internet users regarding DTC Y2K issues, There can be no guarantees that the systems of such other third parties will be timely converted or remediated, or that failure to convert or remedi- ate by such other entity, will not have a material adverse impact on the Issuer or impede its ability to make timely payments of principal of and interest on the Bonds. While institutions are generally aware of the Y2K problem and are generally working to address and prevent such problems, no assurances can be made that all such problems wilI be successfulIy resolved and that the Y2K problem will not affect the State of Minnesota or any other political subdivisions. .., ...J .., J ., J -, -15- J n LJ BOOK-ENTRY ONLY SYSTEM n The Depository Trust Company (the "DTC"), New York, New York, will act as securities depository for the Bonds. Upon issuance of the Bonds, one fully registered Bond will be registered in the name of Cede & Co" as nominee for DTC, for each maturity of the Bonds as set forth on the cover page hereof, each in the aggregate principal amount of such maturity, So long as Cede & Co, is the registered owner of the Bonds, references herein to the Owners of the Bonds shall mean Cede & Co. and shall not mean the Beneficial Owners of the Bonds. LJ n LJ n DTC is a limited purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code and a "clearing agency" registered pursuant to the provisions of S 17 A of the Securities Exchange Act of 1934, as amended. DTC was created to hold securities of its participants (the" DTC Participants") and to facilitate the clearance and settlement of securities transactions among DTC Participants in such securities through electronic book-entry changes in accounts of the DTC Participants, thereby eliminating the need for physical movement of securities Bonds. DTC Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations, some of whom (andlor their representatives) own DTC, Access to the DTC system is also available to others such as banks, brokers, dealers, and trust companies that clear through or maintain a custodial relationship with DTC Participants, either directly or indirectly (the "Indirect Participants"). The interest of each of the Beneficial Owners of the Bonds will be recorded through the records of a DTC Participant or Indirect Participant. Each DTC Participant will receive a credit balance on the rec- ords of DTC, Individual purchases will be made in the denomination of $5,000 or any whole multiple thereof. Beneficial owners of Bonds will receive a written confirmation of their purchases providing details of the Bonds acquired, Beneficial owners of Bonds will not receive Bonds representing their ownership interest in the Bonds, except as specifically provided below, Transfers of beneficial ownership interest in the Bonds will be accomplished by book entries made by DTC and, in turn, by the DTC Participants who act on behalf of the Indirect Participants and the Beneficial Owners of Bonds, For every transfer and exchange of beneficial ownership of Bonds, the beneficial owner may be charged a sum sufficient to cover any tax, fee or other governmental charge that may be imposed in relation thereto. The City will make payments of principal and interest on the Bonds to DTC or its nominee, Cede & Co" as registered owner of the Bonds, Upon receipt of moneys, DTC's current practice is to immedi- ately credit the accounts of the DTC Participants in accordance with their respective holdings shown on the records of DTC. Payments by DTC Participants and Indirect Participants to Beneficial Owners will be governed by standing instructions and customary practices such as those which are now the case for municipal securities held in bearer form or registered in "street name" for the accounts of customers and will be the responsibility of such DTC Participants or Indirect Participants and not the responsibil- ity of DTC or the Issuer, subject to any statutory and regulatory requirements as may be in effect from time to time, u n u n u n u n LJ n u n u ,.., 'LJ r L r L r L r L r L r L r L -16- r l ...., ...J ..., L..J TAX EXEMPTION AND OTHER TAX CONSIDERATIONS ..., Tax Exemption At closing Bond Counsel will render an opinion that, at the time of their issuance and delivery to the original purchaser, under present federal and State of Minnesota laws, regulations, rulings and deci- sions (which excludes any pending legislation which may have a retroactive effect), the interest on each Bond is excluded from gross income for purposes of United States income tax and is excluded, to the same extent, in computing both gross income and taxable net income for purposes of State of Minnesota income tax (other than Minnesota franchise taxes measured by income and imposed on cor- porations and financial institutions), and that interest on the Bonds is not an item of tax preference for purposes of computing the federal alternative minimum tax imposed on individuals and corporations or the Minnesota alternative minimum tax applicable to individuals, estates or trusts; provided that inter- est on the Bonds is subject to federal income taxation to the extent it is included as part of adjusted cur- rent earnings for purposes of computing the alternative minimum tax imposed on certain corporations. No opinion will be expressed by Bond Counsel regarding other federal or state tax consequences caused by the receipt or accrual of interest on the Bonds or arising with respect to ownership of the Bonds, Preservation of the exclusion of interest on the Bonds from federal gross income and state gross and taxable net income, however, depends upon compliance by the Issuer with all requirements of the Internal Revenue Code of 1986, as amended, (The" Code") that must be satisfied subsequent to the is- suance of the Bonds in order that interest thereon be (or continue to be) excluded from federal gross income and state gross and taxable net income, The Issuer will covenant to comply with requirements necessary under the Code to establish and maintain the Bonds as tax-exempt under ~I03 thereof, including without limitation, requirements re- lating to temporary periods for investments and limitations on amounts invested at a yield greater than the yield on the Bonds, ...J ...., LJ ...., L..J ...., ...J ...., L.J ...., LJ ..., L..J ..., Property and Casualty Insurance Companies Property and casualty insurance companies are required to reduce the amount of their loss reserve de- duction by 15% of the amount of tax-exempt interest received or accrued during the taxable year on certain obligations acquired after August 7, 1986, including interest on the Bonds. L.J ...., u Foreign Insurance Companies ...., L..J Foreign companies carrying on an insurance business in the United States are subject to a tax on in- come which is effectively connected with their conduct of any trade or business in the United States, including "net investment income," Net investment income includes tax-exempt interest such as inter- est on the Bonds, ..., ...J Branch Profits Tax ...., A foreign corporation is subject to a branch profits tax equal to 30% of the "dividend equivalent amount" for the taxable year. The "dividend equivalent amount" is the foreign corporation's "effec- tively connected earnings and profits," adjusted for increase or decrease in "U,S. net equity." A branch's earnings and profits may include tax-exempt municipal bond interest, such as interest on the Bonds. L..J ...., ...J ...., Passive Investment Income of S Corporations Passive investment income, including interest on the Bonds, may be subject to federal income taxation under ~ 1375 of the Code for an S corporation that has Subchapter C earnings and profits at the close of the taxable year if more than 25% of the gross receipts of such S corporations is passive investment income, ...J ...., ....j -, -.J ..., -17- J n LJ n Qualified Financial Institutions u Prior to adoption of the Tax Reform Act of 1986 (the" Act"), fmancial institutions were generally per- mitted to deduct 80% of their interest expense allocable to tax-exempt bonds, Under the Act, however, financial institutions are generally not entitled to such a deduction for tax-exempt bonds purchased af- ter August 7, 1986, However, the Issuer will designate the Bonds as "qualified tax-exempt obliga- tions" pursuant to ~265(b)(3) of the Code that will permit financial institutions to deduct interest ex- penses allocable to the Bonds to the extent permitted under prior law. See "Qualified Tax-Exempt Obligations" below. n u n LJ Social Security and Railroad Retirement Benefits Certain recipients of social security benefits and railroad retirement benefits are required to include a portion of such benefits within gross income by reason of receipt of interest on tax exempt obligations, including the Bonds. Exclusion Not Constitutionally Required; Pending Legislation The United States Supreme Court ruled in 1988 that the exclusion from gross income of interest on state and local bonds is not required by the United States Constitution, The Constitution of the State of Minnesota likewise does not require the exclusion from gross income or taxable net income of interest on bonds of Minnesota issuers, Hence, future federal and/or state laws could cause the inclusion of in- terest on bonds, including the Bonds, in gross income of taxable net income, or could otherwise cause such interest to be taxed or to be included in the calculation of other income which is taxed. n LJ n LJ n LJ n u Qualified Tax-Exempt Obligations The Issuer will designate the Bonds as "qualified tax-exempt obligations" for purposes of ~265(b)(3) of the Internal Revenue Code of 1986, as amended, relating to the ability of fmanciaI institutions to deduct from income for federal income tax purposes, interest expense that is allocable to carrying and acquiring tax-exempt obligations, "Qualified tax-exempt obligations" are treated as acquired by a fi- nancial institution before August 8, 1986, Interest allocable to such obligations remains subject to the 20% disallowance under prior law, n LJ n LJ n 'LJ General The preceding is not a comprehensive list of all federal tax consequences which may arise from the re- ceipt or accrual of interest on the Bonds, The receipt or accrual of interest on the Bonds may otherwise affect the federal income tax (or Minnesota income tax or franchise tax) liability of the recipient based on the particular taxes to which the recipient is subject and the particular tax status of other items of in- come or deductions, Bond Counsel expresses no opinion regarding any such consequences. All pro- spective purchasers of the Bonds are advised to consult their own tax advisors as to the tax conse- quences of, or tax considerations for, purchasing or holding the Bonds, n LJ n w r L ,... L r L r- L r- L -18- r L -, ....J ...., ....J CITY OF ANDOVER -, ....J GENERAL INFORMA liON ...., Access and Transoortation The City of Andover, situated in Anoka County, is located in the northern portion of the Twin Cities Metropolitan Area approximately 15 miles north of Minneapolis, Access to the City is provided by Anoka County Roads 7, 9, 16, 18,20, 60, 78 and 116, In addition, State Highways 10 and 47 lie two miles north and one mile east of the City, respectively. There are approximately 163 miles of paved streets within the City's corporate limits, --J ..., ....J ..., ....J Tax Base ..., For taxes collectable in 1999, the tax breakdown is 84.83% residential homestead (non-agriculture), .87% agricultural, 5,79% commercial & industrial, .84% public utility, ,16% railroad operating prop- erty, 3.31 % non-homestead residential and 4,20% personal property. ....J ...., ....J ...., Area 22,493 Acres (35.145 Square Miles) ....J ...., u PooulationlDemoaraohics ..., 1980 Census 1990 Census 1999 Estimate 9,387 15,216 25,000 ....J ...., Andover is expected to grow by nearly 15,000 people to 39,000 between 1998 and 2020, The majority of the growth, 85%, will occur within the 2020 Metropolitan Urban Service Area (the "MUSA") boundary. The majority of residents will continue to be young families and children, Median income is expected to remain among the highest in Anoka County and household size is expected to be among the highest in the Twin Cities, LJ ...., ....J ...., Municioal Facilities LJ Revenue Producing Facilities: ..., The Waterworks Svstem has approximately 3,979 municipal connections served by a 1,000,000 gallon and 500,000 gallon elevated water storage facilities along with five wells that have the capacity to pump 4,700 gallons per minute or 6,768,000 gallons per day, Average demand is 1,054,000 gallons per day while peak demand reaches 4,349,000 gallons per day, Total tap water hardness is 308 parts per million, ...J ...., ...J -., The 1998 audited operating revenues were $928,581 with the average water charge per year per house- hold and commercial connection at approximately $233. The 1998 water base rate is $7,30 per quarter and $,98 per thousand gallons to 10,000 gallons, $1.01 per thousand from 10,001 to 20,000 gallons; $1.05 per thousand from 20,001 to 35,000 gallons, $1.12 per thousand from 35,001 to 60,000 gallons, $1.20 per thousand from 60,001 to 100,000 gallons, $1.35 per thousand from 100,001 to 200,000 gallons and $1.60 per thousand greater than 200,001 gallons. ...J ., J ., -19- J r"' LJ The Sewer Svstem has approximately 4,838 municipal connections that are served by one lift station to the Metropolitan Waste Control Commission's wastewater treatment and disposal facilities, Average demand is 226,000,000 gallons per day, r"' LJ The 1998 audited operating revenues were $928,130 with the average sewer charge per year per house- hold and commercial connection at approximately $192, The 1998 sewage use charge is $31.50 per living unit per quarter in Service Area A and $43,50 per living unit per quarter in Service Area B. Other Municipal Services: Fire and Rescue Department. Fire protection is provided by a 54-member (2 regular and 52 volunteer) fire and rescue department consisting of three fully equipped stations strategically located throughout the City, The City currently has four various size pumpers, three tankers, one 75 foot ladder truck, four grass rigs, four utility vehicles, two rescue/emergency vehicles as well as other various related fire fighting and rescue equipment. Rescue services are provided by a 20-member volunteer department, Police Department, The City of Andover contracts with the Anoka County Sheriffs Department for its police protection, Park and Recreational Facilities. The City currently maintains 56 parks that encompass approximately 953,2 acres. Facilities include 29 parks with general miscellaneous playground equipment, 13 base- ball/softball fields, 9 soccer fields and 13 hockey/skating rinks, of which three have warming houses. The park system also includes 23 class five parking lots, 18 picnic shelters, 2 sliding hills, 7 basketball courts, 4 volleyball courts, 2 tennis courts, 5 irrigation systems and an infant trail system, The recrea- tion programs are handled through the local school district or through the Andover Athletic Association, r"' LJ r"' u r"' LJ r" u r"' u n u r\ The City will continue to expand the trail system. Short-range goals include trails along Bunker Lake Boulevard, Round Lake Boulevard, and Coon Creek. Long-range goals include expansion along major urban roadways, as well as links to regional parks and trails. u n LJ City Government Andover, organized on November 12,1974, is a Minnesota Statutory City with an Option Plan A form of government. It has a mayor elected at large for a two-year term and four council members also elected at large for four-year terms. The professional staff is appointed and consists of a city adminis- trator, city clerk, city treasurer, city finance director, city attorney and city engineer, r'1 .L r L. r Emplovee Pension Proarams The City employs 53 people, 48 full-time and 5 part-time, Fifty-one of the employees are covered un- der PERA as of December 31, 1998, L r The City participates in contributory pension plans through the Public Employees Retirement Association (PERA) under Minnesota Statutes, Chapters 353 and 356, which covers all full-time and certain part-time employee. PERA administers the Public Employees Retirement Fund (PERF) and the Public Employees Police and Fire Fund (PEPFF), which are cost-sharing, multiple-employer retire- ment plans, This plan is state administered and is coordinated with the Federal Social Security Retirement Plan (FICA) and employees are vested after three years of credited service. State statute re- quires the City to fund current service pension cost as it accrues, Prior service cost is being amortized over a period of 40 years and is being funded by payment determined as a percentage of gross wages paid by all employers participating in the State Association, L r L r L r L r l -20- r l ..., LJ ..., The City's contributions to PERA for the past seven years have been as follows: LJ Year Amount Year Amount 1998 $95,463 1994 $42,933 1997 72,503 1993 37,964 1996 63,362 1992 32,321 1995 54,990 ..., LJ ..., LJ The volunteer firefighters of the City are eligible for pension benefits through membership in the Andover Firefighter's Relief Association organized under Minnesota Statutes, Chapter 69, and admin- istered by a separate Board elected by the membership, This plan is funded by state aids, investment earnings and City contributions, State statute requires this plan to fund current service cost as it accrues and prior service cost to be amortized over a period often years, ..., LJ ..., o....J Residential DeveloDmentlHousina There are approximately 7,563 single-family homes and 300 multifamily units located within the City. In addition, there have been 441 single-family homes and 160 multifamily dwellings constructed within the past twelve months, An average of 400 single-family homes per year have been built in the City over the past five years, Single-family detached housing will continue to predominate. Demand for townhomes and condomini- ums are expected to increase during the next two decades, The rental population is expected to slightly increase, primarily due to seniors. Approximately 350 homes per year have been constructed during the 1990's; this rate is expected to continue into the next decade, decreasing slightly during the 2010's, Most housing is in good to excellent condition; however, the Crosstown Multiple Family District (located north of Bunker Lake Boulevard, between Crosstown Drive and Crosstown Boulevard) may warrant redevelopment during the planning period. Listed below are the residential subdivisions located within the MUSA I, ..., L.J ..., LJ ..., L.J ..., L.J ..., Subdivision Total Number Number of Lots Remaining Lots Name of Lots Comvleted Available 1996 Crown Pointe 49 38 11 Hunters Hollow 21 12 9 Meadowlark Heights 16 II 5 Nightingale Ridge 6 6 0 Rolling Meadows Estate 12 5 7 1997 Cherrywood Estates 26 9 17 Chesterton Commons 92 78 14 Crown Pointe East-2nd Addition 70 62 8 Indian Meadows-4th Addition 15 9 6 Indian Meadows-5th Addition 14 5 9 Nightingale Preserve 11 6 5 Shadowbrook-l" Addition 175 159 16 Shadowbrook-2nd Addition 99 54 45 Timber River Estates 81 25 56 Woodland Estates 165 92 73 L.J ..., LJ ..., LJ ..., L.J ..., o....J ..., o....J ..., -..J ..., J I The MUSA is the area with municipal sanitary sewer and water services. --, -21- ...J n LJ n (Cont,) Subdivision Total Number Number of Lots Remaining Lots Name of Lots Completed Available 1998 Echo Hills_2nd Addition 7 2 5 Langfeld's Oak Ridge Estates 6 4 2 Shadowbrook-3'd Addition (Single-Family) 4 4 0 Shadowbrook-3rd Addition (Multifamily) 56 12 44 Shadowbrook-4th Addition 37 14 23 The Farmstead (Single-Family) 4 0 4 The Farmstead (Multifamily) 144 144 0 1999 Cambridge Estates 54 0 54 Cambridge Estates-2nd Addition 22 0 22 Chesterton Commons-2nd Addition 73 0 73 Chesterton Commons-3rd Addition 31 0 31 Chesterton Commons-4th Addition 19 0 19 Chesterton Commons North 47 0 47 Shadowbrook-5th Addition (Single-Family) 3 0 3 Shadowbrook-5th Addition (Multifamily) ~ ~ 40 Total 1.399 ill ~ In addition, one development currently in the sketch phase is: Subdivision Total Number Number of Lots Remaining Lots Name of Lots Comvleted Available Pheasant Glen 26 N/A 26 u n u n u n u n u n u n u n LJ n LJ The total number of vacant lots available within the City of Andover for developments currently in process as well as the planning and sketch phases is approximately 674, n 'LJ n Industrial Parkts) LJ The City of Andover has an approximate 40-acre industrial park with a capacity for 12 enterprises known as the Hughes Industrial Park. Currently there are twelve enterprises occupying the park, the larger of which include Ace Solid Waste Management Inc" Larson Plumbing & Heating and Hardwood Industries, n LJ In addition, The City of Andover has an approximate 30-acre commercial park known as the Andover Commercial Park. Currently there are twelve enterprises occupying the park, the larger of which in- clude Riccar Heating & Air Conditioning Inc., For Kids Only, Aircon Electric and M & S Drywall. The City also is in the process of developing a 90-acre commercial/industrial park on Hanson Boulevard NW south of the WDE landfill on the site of a former auto salvage yard, Tax increment fi- nancing was used to acquire and improve this property and one enterprise currently occupies the park. The City estimates that 100% of commercial/industrial development occurs within the MUSA. r L r L r L r L r L - 22- r L ..., '-.J ..., '-.J Commercial/Industrial DeveloDment Building construction and commercial/industrial growth completed within the past three years have been as follows: ..., -J -, Name Andover Cinema I Andover Park Clinic Andtt BuildingI Children's World Country Ridge Inc, I G- Will Liquors Hope Lutheran Churchl Mork Clinic Stucco One Tutor Time U.S, Postal Service I Ultimate Cabinets Product/Service 10-screen Theatre Medical Services Office Building Day Care Facility OfficelW arehouse Liquor Store Church Medical Services Office Building Day Care Facility Post Office Cabinetry/Woodworking Description of Construction 32,000 Square Feet 30,000 Square Feet 4,400 Square Feet 8,500 Square Feet 17,000 Square Feet 14,500 Square Feet 7,000 Square Feet 12,500 Square Feet 5,000 Square Feet 11,400 Square Feet 30,000 Square Feet 5,000 Square Feet LJ -, '-.J ..., ....J ..., ....J ..., i...J BuildinQ Permits Building permits issued for the past eight years and a portion of the current year have been as follows: ..., LJ Commercial/ Industrial Residential Total Total Number of Number Number Permit Year of Permits of Permits of Permits Valuation 1999 (as of 07/31/99) 2 274 276 $41,786,329 1998 10 448 458 69,529,349 1997 2 282 284 30,844,000 1996 N/A 272 N/A 28,776,000 1995 12 305 317 57,336,572 1994 9 400 409 44,460,723 1993 5 514 519 52,337,400 1992 3 484 487 48,174,935 1991 7 280 287 28,570,866 Financial Institutions ..., LJ ....., LJ ....., ....J ..., -J ....., L.J ..., Financial services are provided by Firstar Bank of Minnesota, National Association (branch of St. Paul), Reported deposits as of December 31, 1998, are not available at this time as reported from the latest edition (spring 1999) of the McFadden Upper Midwest Financial DirectoryTM. L.J ..., LJ ....., L.J ..., '-.J I New construction completed within the past twelve months. ....., - 23- LJ Education The majority of the children in the City of Andover attend Independent School District No. 11, Anoka- Hennepin, The northern one-fifth of the City attends Independent School District No. 15, St. Francis. The two districts combined operate 33 elementary schools, 7 middle schools and 5 senior high schools, Directly located within the City are two elementary schools, grades kindergarten through five, both part ofISD No, 11 Anoka-Hennepin, In addition, there is a parochial school located within the City, Meadow Creek Christian, consisting of grades kindergarten through twelve, Further, Meadow Creek Christian is accredited by the Association of Christian Schools International. Post secondary education is available at the following schools: Major Emplovers/Economic Base The City has 130 retail or commercial enterprises in the City employing an estimated 3,000 people. In addition, there is one 103,006 square foot shopping center located within the City with fifteen stores employing approximately 300 people. Andover's employment base is expected to increase by nearly 65% to 4,850 employees by 2020. Employment growth will be concentrated in the southern part of the City. A majority of the increase will occur in the Commercial Park Redevelopment Area. The following is a list of the fifteen largest commercial/industrial employers within the City: Schoo/ Anoka-Hennepin Technical College Anoka-Ramsey Community College University of Minnesota Augsburg College Commercial/Industrial Emvlover Kottke Bus Service Inc, Andover Elementary School Festival Foods Anoka County Highway Dept. Merwin Drug Co, Oak View Middle School Meadow Creek Christian School Crooked Lake Elementary School Pov's Sports Bar City of Andover I Ace Solid Waste Ed Fields & Sons Inc, Larson Plumbing & Heating Riccar Heating & Air Conditioning For Kids Only I Constitutes 48 full-time and 5 part-time employees. lJ:Jzf. Technical College Community College Public University Private College Location Anoka, Minnesota Coon Rapids, Minnesota Minneapolis, Minnesota Minneapolis, Minnesota Product/Service Bus Charter Services Public Education Grocery Store County Government Programs Drug & Proprietary Stores Public Education Private Education Public Education Restaurant! Bar City Government N/A Fresh Fruits & Vegetables Plumbing, Heating & Air Conditioning Plumbing, Heating & Air Conditioning N/A - 24- n LJ n u n LJ n u n u Distance from Andover n u 5 Miles 5 Miles 20 Miles 20 Miles n LJ n u n U n LJ n 'U Number of Emvlovees 190 122 120 110 86 85 75 59 55 53 45 40 40 40 36 n LJ n u n u n LJ n U n U n u n u .., --.J .., ..-.J Laraest TaxDavers The ten largest taxpayers as reported from Anoka County are as follows: .., --.J Percent of Real Property 1998/1999 1998/1999 To Net Estimated Net Tax Tax Capacity Name Service Market Value Cavacitv ($13.992.416)/ Anoka Electric Co-op/Conexus Electric Utility $9,177,000 $321,196 2.30% Andover Limited Partnership Commercial 7,121,000 247,661 1.77 Minnegasco Inc. Gas Utility 4,004,900 140,172 1.00 Individual Residential (3A) 2,516,900 86,517 .62 Northern States Power Co. Utility 1,562,000 54,670 .39 Minnesota Pipeline Co. Utility 1,307,600 45,767 .33 MN Interstate Pipeline Utility 1,109,500 38,834 ,28 Individual RestaurantlBar 1,086,400 36,449 ,26 Great River Energy Utility 1,079,800 37,794 .27 Kottke Bus Service Inc, Commercial 1,072,700 35,971 ,26 ..., --.J .., .-.J .., --.J ..., --.J ..., '-...J .-, LJ ..., --.J .., --.J -., --.J (Remainder of page left intentionally blank.) ..., ....J ..., ....J ..., ....J -, -.J -, ...J ., J I Before tax increment and fiscal disparity adjustments. ., -25 - J n ~ MINNESOTA VALUATIONS. TAX CREDITS AND LEVY LIMITATIONS r L.J Market Value n According to Minnesota Statutes, Chapter 273, all real property subject to taxation is to be appraised at maximum intervals of four years. All real property becoming taxable in any year is listed at its esti- mated market value on January 2 of that year. The estimated market value is the County Assessor's appraisal of the worth of the property, Indicated Market Value u r u The Minnesota Department of Revenue conducts the Real Estate Assessment/Sales Ratio Study to ac- complish equalization of property valuation in the State of Minnesota and to determine the probable selling price of a property, The study is a three-year average of sale prices as related to the latest asses- sor's estimated market value, The indicated market value is determined by dividing the estimated mar- ket value by the Assessment/Sales Ratio for the city as determined by the Department of Revenue, " L' r u Net Tax Capacity Starting with taxes payable in 1990, net tax capacity replaced gross tax capacity as the measure of tax- able value, To determine net tax capacity, the estimated market value is multiplied by a factor called "class rate," that varies depending on the use of the property, Net tax capacity differs from gross tax capacity primarily in setting lower values for homesteaded residential and agricultural properties. Net tax capacity is multiplied by the" local tax rate" to determine taxes payable, Tax Cycle n u n u n LJ Minnesota local government ad valorem property taxes are extended and collected by the various counties within the state. The process begins in the fall of every year with the certification, to the county auditor, of all local taxing districts' property tax levies. Local tax rates are calculated by divid- ing each taxing district's levy by its net tax capacity, One percentage point of local tax rate represents one dollar of tax per $100 net tax capacity. A list of taxes due is then prepared by the county auditor and turned over to the county treasurer on or before the first Monday in January, n u n The county treasurer is responsible for collecting all property taxes within the county. Real estate tax statements are to be mailed out no later than January 31 and personal property tax statements no later than February 15, The due dates for payment of real property taxes are one-half on or before May 15 and one-half on or before October 15. Personal property taxes become due one-half on or before February 28 and one-half on or before June 30. Following each settlement (March 5, June 5, and November 5 of each year), the county treasurer must redistribute property tax revenues to the local taxing districts in proportion to their tax capacity ratios. Delinquent property taxes are penalized at various rates depending on the type of property and the length of delinquency. Tax Credits .L r L r L r L r Prior to 1990, taxes on homestead residential and agricultural property were reduced by a direct sub- sidy to the taxpayer. Beginning in 1990, the homestead credit has been eliminated, The state subsidy is now accomplished through lower class rates to homesteaded classifications of property and increased state aids paid directly to local taxing districts. This new system is intended to have generally the same impact as the former homestead credit system. L r L .. L r l - 26- ..., ....J -, Tax Levies for General Obligation Bonds (Minnesota Statutes, ~475.61) The governing body of any municipality issuing general obligations shall, prior to delivery of the obli- gations, levy by resolution a direct general ad valorem tax upon all taxable property in the municipality to be spread upon the tax rolls for each year of the term of the obligations, The tax levies for all years shall be specified and such that if collected in full they, together with estimated collections of special assessments and other revenues pledged for the payment of said obligations, will produce at least five percent in excess of the amount needed to meet when due the principal and interest payments on the obligations. Such resolution shall irrevocably appropriate the taxes so levied and any special assess- ments or other revenues so pledged to the municipality's debt service fund or a special debt service fund or account created for the payment of one or more issues of obligations, The governing body may, at its discretion, at any time after the obligation have been authorized, adopt a resolution levying only a portion of such taxes, to be filed, assessed, extended, collected and remitted as hereinafter provided, and the amount or amounts therein levied shall be credited against the tax required to be levied prior to delivery of the obligations, The recording officer of the municipality shall file in the office of the county auditor of each county in which any part of the municipality is located a certified copy of the resolution, together with full in- formation regarding the obligations for which the tax is levied. No further action by the municipality is required to authorize the extension, assessment and collection of the tax, but the municipality's liability on the obligations is not limited thereto and its governing body shall levy and cause to be extended, assessed and collected any additional taxes found necessary for full payment of the principal and inter- est. The auditor shall annually assess and extend upon the tax rolls the amount specified for such year in the resolution, unless the amount has been reduced as authorized below or, if the municipality is lo- cated in more than one county, the portion thereof that bears the same ratio to the whole amount as the tax capacity value of taxable property in that part of the municipality located in his county bears to the tax capacity value of all taxable property in the municipality, Tax levies so made and filed shall be irrevocable, except that if the governing body in any year makes an irrevocable appropriation to the debt service fund of moneys actually on hand or if there is on hand any excess amount in the debt service fund, the recording officer may certify to the county auditor tht: fact and amount thereof and the auditor shall reduce by the amount so certified the amount otherwise to be included in the rolls next thereafter prepared. '-.J ..., ~J ..., '-.J ..., L.J ..., L.J ..., ....J ..., ....J ..., L.J ~., L.J ..., '-.J ..., All such taxes shall be collected and remitted to the municipality by the county treasurer as other taxes are collected and remitted, and shall be used only for payment of the obligations on account of that levied or to repay advances from other funds used for such payments, except that any surplus remain- ing in the debt service fund when the obligations and interest thereon are paid may be appropriated to any other general purpose by the municipality. ....J ..., ....J Levy Limitations -, The 1997 Minnesota Legislature (Laws 1997, Chapter 231, Article 3) established levy limitations for all counties and for all cities over 2,500 population which will be effective for taxes collected in 1998 and 1999, The computations of levy limits were determined by the Commissioner of Revenue and were available for each City and County on August I, 1997, The levy limits will not apply to certain" spe- ciallevies" which will include levies to pay debt service, L.J ..., ....J Class Rate -, -.J The factors (class rates) for converting estimated market value to net tax capacity represent a basic element of the State's property tax relief system and are therefore subject to annual revisions by the State Legislature, The following is a partial summary of these factors: --., ~ -, J ., -27 - j n u The following is a partial summary of these factors: n LJ Property Tax Classifications Class Rate Schedule n Proposed U TVDe of PrODertv /9951 /9961 /9971 /9981 /9991 /996 /997 /998 /999 2000 n Residential Homestead u Under $72,000 1.000% 1.000% Over $72,00 I 2.000 2.000 Under $76,000 1.000% 1.000% 1.000% n Over $76,001 1.850 1.700 \.650 u Comrnercial/Industrial Public Utility Under $100,000 3.000 3.000 n Over $100,001 4.600 4.600 Under $150,000 2.700 2.450 2.400 u Over $150,001 4.000 3.500 3.400 Agricultural Land & Buildings n Homestead: LJ Under $115,000 .450 .450 .400 .350 .350 $115,000-$600,000 n Under 320 Acres 1.000 1.000 ,900 .800 .800 Over 320 Acres 1.500 1.500 1.400 1.250 .800 LJ Greater than $600,00 I Under 320 Acres \.000 1.000 ,900 .800 1.200 n Over 320 Acres 1.500 1.500 1.400 1.250 1.200 LJ Non-Homestead 1.500 1.500 1.400 1.250 1.200 Residential Non-Homestead r1 Apartments: LJ I to 3 units 2.300 2,300 I Unit 1.900 1.000 1.000 2 or 3 units 2.000 1.000 1.000 n 4 or more units 3.400 3.400 2.900 2.500 2.400 'LJ Small cities less than 5,000 population with 4 or more units 2.300 2.300 2.300 2.150 2.150 Under $76,000 2.300 2.300 1.900 1.250 1.200 r Over $76,001 2.300 2.300 2.100 1.700 1.650 L Seasonal RecreationaVCornrnercial Non-Commercial: r Under $72,000 2.000 1.750 Over $72,001 2.500 2.500 L Under $76,000 1.400 1.250 1.200 Over $76,001 2.500 2.200 1.650 Resorts: r Homestead 1.000 1.000 1.000 1.000 1.000 Seasonal 2.300 2.300 2,100 1.800 1.650 L Vacant Land .See Footnote 2.300 2.100 1.700 1.650 r L r L r L -28- .., ....J .., CITY OF ANDOVER ECONOMIC AND FINANCIAL INFORMATION ....J .., LJ .., ....J .., Real Property Personal Property Less Tax Increment Deduction Fiscal Disparitiesl (Contribution to Pool) Distribution from Pool ....J .., ....J .., Total Valuation ....J Valuations Estimated Market Value 1998/1999 $ 1,051,879,200 17,547,300 Net Tax Capacity 1998/1999 $13,992,416 613,217 789,039) ( ( 560,491) 2.182,912 $15.439,015 $ 1.069.426,500 Market Value After Sales Assessment Ratio .., The Minnesota Department of Revenue conducts the Real Estate Sales Assessment Ratio Study to ac- complish equalization of property valuations in the State and to determine the probable selling price of a property. The Study is a three-year average of sale prices as related to the latest assessor's market value, The latest Sales Assessment Ratio (1998) in Andover is 90.1% meaning the County Auditor's recorded real property market value of $1,05 I ,879,200 is 90, I % of the probable resale market value. We have made the following computations in deriving the market value figure used in the "Summary of Debt and Debt Statistics," ....J .., ....J .., ....J .., $1,051,879,200 90.1% = $1,167,457,492 + 17.547.300 $ 1.185.004.792 ....J .., ....J .., L.J .., County Auditor's recorded real property market value, Latest Composite Ratio from the Real Estate Sales Assessment Ratio Study of the Minnesota Department of Revenue. Indicated market value of real property. Personal property, Indicated market value of real and personal property used in "Summary of Debt and Debt Statistics." Sales Assessment Ratio History The Sales Assessment Ratio for the City of Andover over the past eight years have been as follows: Year Amount Year Amount 1998 90,1% 1994 89.7% 1997 90.5 1993 89,7 1996 91.1 1992 92.5 1995 90.1 1991 93.0 LJ ..., L..J ..., ....J .., LJ .., I Fiscal Disvarities Law The 1971 Legislature enacted a "fiscal disparities law" which allows all the Twin City Metropolitan Area Municipalities to share i~ the commercial/industrial growth, regardless of where the growth occurred geographically. Forty percent (40%) of every metropolitan municipality's growth in commercial/industrial assessed valuation is pooled, then redistributed to all municipalities on the basis of population and per capita valuation after the tax increment and fiscal disparity adjustments. ....J .., ....J - 29- n u Valuation Trends (Real and Personal Property) Valuation Trends for the City of Andover over the past ten years have been as follows: n u ,.., Levy Year/ Collection Year Estimated Market Value Net Tax Capacity Before Fiscal Disvarities! Net Tax Capacity After Fiscal Disvarities] u ,.., 1998/1999 1997/1998 1996/1997 1995/1996 1994/1995 1993/1994 1992/1993 1991/1992 1990/1991 1989/1990 $1,069,426,500 964,037,300 852,030,400 777,819,300 679,429,100 602,107,500 542,411,200 502,562,400 467,376,200 407,805,500 $14,605,633 13,887,786 13,342,748 12,019,964 10,271,906 9,114,246 8,420,876 8,208,381 8,176,220 7,043,958 $15,439,015 14,674,020 14,112,304 12,803,201 10,877,389 9,993,705 9,414,093 9,322,277 9,423,989 8,179,916 u n u ,.., LJ ,.., LJ Breakdown of Valuations n 1998/1999 Estimated Market Value, Real and Personal Property: u Total $ 953,146,200 25,290,000 26,937,700 3,488,100 677,300 42,339,900 17,547,300 $ 1.069.426,500 89.13% 2.36 2,52 ,33 ,06 3,96 \.64 n Residential Homestead Agricultural Commercial & Industrial Public Utility Railroad Operating Property Non-Homestead Residential Personal Property u n LJ ,.., 100.00% 'LJ 1998/1999 Net Tax Capacity, Real and Personal Property (before tax increment and fiscal disparity adjustments): n u Residential Homestead $ 12,390,107 84.83 % Agricultural 127,422 ,87 Commercial & Industrial 845,128 5,79 Public Utility 122,085 ,84 Railroad Operating Property 23,706 .16 Non-Homestead Residential 483,968 3.31 Personal Property 613.217 4,20 Total $ 14.605.633 100.00% n u ,.., u ,.., u n LJ n LJ ,., I Also before the tax increment deduction. 2 Also after the tax increment deduction. u -30- r L ....., ...J ..., ...J Net Tax CaDacitv Rate History The following are tax rates for the City of Andover for the past five assessable/collection years: ..., u ..., Levy Year/ Collection Year u County of Anoka City of Andover ISD No. 11, Anoka-Hennepin Market Value Referendum Rate ISD No, 15, St. Francis Market Value Referendum Rate Metropolitan Council Metro Mosquito Control Metro Transit Area Anoka County RR Authority Anoka County HRA Coon Creek Watershed ..., ...J ..., ...J ..., u Totals: ..., ...J ...,. Levy Year/ Collection Year Original Gross Tax Levy ...J ..., .....J Property Tax Credits 1 Levy Adjustments Net Tax Levy ..., u ..., Amount Collected during Collection Year u Percent of Net Tax Levy Collected ..., Amount Delinquent at end of collection Year u ....., Delinquencies Collected as of (12/31/98) LJ ..., Delinquencies Abated or Cancelled as of (12/3 1/98) ...J Total Delinquencies Outstanding as of (12/31/98) ..., ....J Percent of Net Tax Levy Collected ..., Note: 1997/1998 Gross Tax Levy 1997/1998 Net Tax Levy ....J ....., 1994/95 Net Tax Capacity Rates 32.76500% 19,79900 61.40200 0.00000 63,28100 .03022 .37200 .37400 .35300 .00100 .00000 .87600 179.25322 1995/96 Net Tax Capacity Rates 31.03600% 19.37400 64,38700 .04289 69.50900 .03813 .77200 .23900 .34500 .00000 ,82300 .36100 186.92702 1996/97 Net Tax Capacity Rates 30,09100% 19.80400 55.58800 .Q3 0 13 60.23400 ,03035 ,73600 .24900 .33100 .00000 ,00000 .43400 167.52748 Tax Levies and Collections 1993/ /994 $ 2,366,327 ( 572,759) 485 $ 1,794,053 $ 1,762,461 98.24% $ 31,592 ( 27,931) $ 99,96% 1994/ 1995 $ 2,711,023 1997/98 Net Tax Capacity Rates 30,61800% 21.60500 51.82400 .08646 57.16900 .03174 ,88300 ,28900 .35900 .47100 .00000 .40500 163.74120 /995/ 1996 $ 3,057,662 ( 585,140) ( 568,312) 59 $ 2,125,942 $ 2,101,416 98.85% 97 $ 2,489,447 $ 2,463,276 98.95% $ 24,526 $ 26,171 ( 19,540) ( 22,539) 2.971) ( 2.704) 2,282 99.89% I Properly tax credits are aids provided by the State of Minnesota and paid directly to the City. ...j --, -.J 690 $ $3,653,428 3,190,577 -31- 543 $ 4,175 99.83% /998/99 Net Tax Capacity Rates 32.26500% 23.29400 54.85600 .05541 59.33300 .03252 .88600 .34000 .38800 .47400 .00000 .38400 172.30793 1996/ /997 $ 3,220,809 462,938) 75 $ 2,757,946 $ 2,727,018 98.88% $ 30,928 ( 20,472) 722 $ 11,178 99.59% n u CITY OF ANDOVER. MINNESOTA GENERAL OBLIGATION DEBT (As of September 2.1999, Plus This Issue) n LJ n u Purpose: G.O. G.O. G.O. G.O. G.O. G.O. Improvnnnrl Improvement l,"prov~menl Tax Taxabu ImprcwemDrt Bonds Bonds Bonds Increment Tax IncrDftenl Bonds of of Sma, Bonds, Bonth, Serino 1977 1985A 1993A Sma 1993B Sma 1994B 1994C n u Dated: 02/0In7 02/01/85 08/01/93 08/01/93 05/01/94 10/01/94 Original Amount: SI,215,000 5300,000 $3,650,000 S520,000 5885,000 SI,14O,000 Maturity: I-Jan I-Feb I-Aug I-Aug I-May I-Feb Interest Rates: 5.00% 9.20-9.60% 2.90-4.75% 3.50-4.75% 5.55-7.87% 5.05-5.75% 1999 SO SO SO SO SO SO 1999 2000 60,000 25,000 365,000 55,000 90,000 115,000 2000 2001 65,000 0 365,000 55,000 90,000 11 5,000 2001 2002 65,000 0 365,000 55,000 90,000 115,000 2002 2003 65,000 0 365,000 55,000 90,000 120,000 2003 2004 70,000 0 0 0 75,000 120,000 2004 2005 70,000 0 0 0 0 125,000 2005 2006 70,000 0 0 0 0 95,000 2006 2007 0 0 0 0 0 0 2007 2008 0 0 0 0 0 0 2008 2009 0 0 0 0 0 0 2009 2010 0 0 0 0 0 0 2010 2011 0 0 0 0 0 0 2011 2012 0 0 0 0 0 0 2012 2013 0 0 0 0 0 0 2013 $465,000 525,000 SI,460,000 5220,000 5435,000 S805,000 (1) (1) (1) (2) (2) (1) (3) n u n u n u n LJ n LJ n u Purpose: G.O. G.O. G.O. G.O. G.O. G.O. lmprovemf!nt Improyemmt EquipmenJ Tax Tax Crossover Bonds RefundUrg cutifU:Ill" of IncrnnDll Increment RefundUrg Sma, Bonds, llUkbtedn..., Bonds, Suies Bonds Bonds 1995A Sma 1995B Sma 1995C 1995D of 1996 of 1996 n LJ n Dated: 06/01/95 06/01/95 06/01/95 10/01/95 06/01/96 06/01/96 Original Amount: S2,605,000 5825,000 S5I5,000 56,055,000 S2,055,000 51,220,000 Maturity: I-Feb I-Aug I.Feb I-Feb I-Aug I-Aug Interest Rates: 4.80-5.30% 4.40-4.85% 4.40-4.85% 4.50-5.60% 4.75-5.40% 4.15-4.50% 1999 SO SO SO SO 50 SO 1999 2000 240,000 120,000 175,000 175,000 80,000 300,000 2000 2001 255,000 0 0 200,000 85,000 300,000 2001 2002 265,000 0 0 225,000 95,000 0 2002 2003 280,000 0 0 225,000 105,000 0 2003 2004 295,000 0 0 250,000 115,000 0 2004 2005 310,000 0 0 350,000 125,000 0 2005 2006 310,000 0 0 425,000 140,000 0 2006 2007 0 0 0 450,000 150,000 0 2007 2008 0 0 0 475,000 165,000 0 2008 2009 0 0 0 500,000 180,000 0 2009 2010 0 0 0 525,000 195,000 0 2010 2011 0 0 0 575,000 215,000 0 2011 2012 0 0 0 600,000 230,000 0 2012 2013 0 0 0 625,000 0 0 2013 51,955,000 5120,000 5175,000 55,600,000 51,880,000 5600,000 (1) (3) (1) (4) (5) (2) (2) (1) (6) u n u n LJ r L r L r L r L - 32- r L Dated: 06/01/99 06/01/99 10/01/99 Original Amount: SI,500,000 51,050,000 53,525,000 Maturity: I-Dee I-Feb I-Dec Interest Rates: 5.00-4.65% 3.70-4.00% TOTALS: 1999 SO 50 50 51,445,000 1999 2000 0 0 705,000 4,435,000 2000 2001 50,000 225,000 705,000 4,200,000 2001 2002 80,000 250,000 705,000 3,760,000 2002 2003 110,000 270,000 705,000 3,230,000 2003 2004 140,000 305,000 705,000 2,920,000 2004 2005 140,000 0 0 1,960,000 2005 2006 140,000 0 0 1,230,000 2006 2007 140,000 0 0 740,000 2007 2008 140,000 0 0 780,000 2008 2009 140,000 0 0 820,000 2009 2010 140,000 0 0 860,000 2010 2011 140,000 0 0 930,000 2011 2012 140,000 0 0 970,000 2012 2013 0 0 0 625,000 2013 SI,500,000 51,050,000 S3,525,000 S28,905,000 (2) (9) (5) (I) ..., L.J ..., L.J ..., L.J Purpos.: ..., L..J ..., Dated: Original Amount: Maturity: Into...., Rat..: u ..., ....J .., L.J ..., ....J .., L.J .., L.J .., L.J Purpose: .., u ..., L.J .., L.J .., L.J ..., L.J ..., u .., ...J -, ...J CITY OF ANDOVER, MINNESOTA GENERAL OBLIGATION DEBT (As of September 2,1999, Plus This Issue) G.O. G.O. G.O. G.O. G.O. ImprOl'emenl ImprOl'ement Refunding ImprOl'menl Refunding Bonds Bonds Bonds Bonds Bonds of of1997, of of1997, of 1996 Series A 1997 Series B 1998 06/01/96 5600,000 I-Aug 3.90-5.00% 05/01/97 53,120,000 I-Dee 4.20-4.80% 06/01/97 5630,000 I-Aug 4.20-4.50% 07/01/97 S6,315,000 I-Dee 3.90-4.70% 12/01/98 5760,000 I-Jul 3.50-3.65% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 SO 60,000 60,000 65,000 65,000 70,000 70,000 50,000 o o o o o o o 5650,000 610,000 605,000 605,000 o o o o o o o o o o o SO 210,000 o o o o o o o o o o o o o S795,000 785,000 785,000 780,000 775,000 775,000 770,000 o o o o o o o o SO 265,000 240,000 o o o o o o o o o o o o S440,000 (I) 52,470,000 (I) 5210,000 (I) (7) 55,465,000 (I) 5505,000 (I) (8) This Issue G.O. G.O. G.O. Tax Equipment Improvement IncremnJI Certifu:ates Bonds Bonds of of of 1999 1999 1999 -33 - 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 n LJ CITY OF ANDOVER, MINNESOTA GENERAL OBLIGATION DEBT (As of September 2,1999, Plus This Issue) n u n (1) These bonds are payable primanly from special assessments against all benefitted property and additionally secured by ad valorem taxes on all taxable property within the City and without limitation of amount. (2) These bonds are payable prlmarily from tax incremenU derived WIthin Tax Increment District Nos. 1-1. J -2 and additionally secured by ad valorem taxes on all taxable property within the City and without limitation of amount. (3) These bonds are additionally secured by Financial Security Assurance Inc. {formerly Capital Guaranty Corp.; and additionally rared AM. (4) These bonds current refunded $81 5.000 of the $2.350.000 General Obligah'on Improvement Bonds of 1985. dated August 1. 1985. Maturities/or that i,rsue were calledfor redemption on Augu,rt 1. 1995. at a price of par plus accrued interest. (5) These bonds are payable solely from ad valorem taxes on all taxable property within the City and without limitation of amount. (6) These bonds cross refUnded $1,200,000 of the $3,200,000 General Obligation Improvement Bonds, Series I989A, dated July I, 1989. Maturitie,r 1998 through 2001. inclu,rive. were calledfor redemption on August 1. 1997. at a price of par plu,r accrued intere,rt. (7) These bonds current refUnded $1,015,000 of the $2,~85,000 General Obligation RefUnding Improvement Bonds, Series I986C. dated August 1. 1986. Maturities 1998 through 2002. inclusive. were calledfor redemption on August 1. 1997. at a price of par plus accrued Interest. The General Obligation RefUnding Improvement Bonds, Series 1986C, dared August I, 1986, cross refUnded $3,2~0,000 of the $4.365.000 General Obligation Improvement Bond,r of 1980. Series B. dated October 1. 1980. Maturities 1991 through 2002. inclusive. were caUedfor redemption on February 1. 1987. at a price of par plus accrued interest. (8) These bonds currenrrefUnded $750,000 of the $2,500,000 General ObligahOn Bonds, Series 199IA, dated July I, 1991. Marunties 1999 through 2001. inclu,rive. were calledfor redemption on January 1. 1999. at a price of par plus accrued interest. (9) These bonds are additionally ,recured by MBIA In,rurance Corporation and are rated AAA by Standard & Poor's Corporahon. u n LJ n u n u n LJ n LJ n u n u n . LJ n LJ n u n LJ r L f""' L r L r L -34- r l ..., ....J ..., L.J ..., ....J .., :..J ..., ....J .., L.J ..., ....J .., L.J ..., ....J ..., ....J ..., ....J (1) ..., L.J ..., ....J .., LJ ..., L.J ..., ...J ..., ....J .., ....J .., -..J Purpose: Dated: Original AmoWit: Maturity: Interest Rates: 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 201 I 2012 2013 2014 2015 2016 EDA OF THE CITY OF ANDOVER, MINNESOTA SPECIAL OBLIGATIONS (As o/September 2,1999) Public Proj~d Rn~nue Bonds 0/1997 09/01/97 52,350,000 I-Dee 4.50-5.90% $40,000 45,000 55,000 60,000 70,000 80,000 90,000 100,000 110,000 120,000 135,000 150,000 165,000 180,000 195,000 220,000 240,000 260,000 S2,3 I 5,000 (1) These bonds are payable solely from annual appropriations to be made On an annual basis by the governing body afthe City. The Bonds do not constitute general obligations olthe City but are special obligations althe EDA altne City of Andover. The Bonds WIll constitute a charge against the general credit and taring powers of the City pursuant to Laws of Minnesota for 1997, Chapter 23 J. Section 33. - 35- n LJ Overlaooina Debt 1998/1999 1998/1999 Net Tax Net Tax Capacity Percentage City's Capacity Value Applicable Share Issuer Value(/) in Cirv!/) in Cirv Net Debt of Debt County of Anoka $ 184,753,007 $15,439,015 8.36% $101,090,000(2) $ 8,451,124 ISD No, 11, Anoka-Hennepin 120,649,474 14,050,841 11,65 87,404,751(3) 10,182,653 ISD No, 15, St. Francis 15,013,056 1,388,174 9,25 48,624,573(4) 4,497,773 Metropolitan Council 2,090,818,016 15,439,015 .74 27,075,000(5) 200,355 Metro Transit 1,858,308,144 15,439,015 ,83 61,306,000(6) 508,840 Total Overlapping Debt: $23.840.745 n LJ n LJ n u n u n u n u n u County of Anoka Overlaooina Debt Future Financina The County does not anticipate the issuance of any additional bonding within the next three months, n LJ ISD No. 11, Anoka-Hennepin The District does not anticipate the issuance of any additional bonding within the next three months. n u ISD No, 15, St. Francis The District does not anticipate the issuance of any additional bonding within the next three months, n LJ n Metropolitan Council Metropolitan Council recently issued $14,000,000 General Obligation Sewer Bonds, Series 1999B, dated July 1, 1999 on July 14, 1999, LJ n Metro Transit Metro Transit does not anticipate the issuance of any additional bonding within the next three months, LJ n u (I) Taxable Net Tax Capacity values are after the tax increment and fiscal disparity adjustments. (2) Anoka County reported bond indebtedness of $1 0 I ,090,000 and sinking funds of $0 as of December 3 I, 1998. (3) ISD No. 11, Anoka-Hennepin, reported bond indebtedness of $132,218,490 and sinking funds of $44,813,739 as of June 30, 1998. (4) ISD No. 15, Sl. Francis, reported bond indebtedness of $70,534,604 and sinking funds ofS21,91O,031 as of March 1, 1999. (5) Deductions: (Al $512.633,599 Metropolitan Waste Control Commission Debt as of July 31, 1999. (B) $34,090,000 Metropolitan Council Sports Facility Revenue Bonds as of December 31, 1998. Note I: Debt Service on A above is 100% self supported from revenues of the Metro Sanitary Sewer System, although the bonds are full faith and credit bonds. Sinking funds of $18,836,000 and escrow account funds of $64,562,000 have not been deducted because said funds are attributable to A above. Fund balances are as of December 3 I, 1998. Note 2: Debt Service on B (Metropolitan Council, Minneapolis-St. Paul Area Sports Facility Revenue Bonds) is not included in the above debt as the bonds are supported by revenues generated from the sports facility although the bonds are full faith and credit bonds. Note 3: The only tax supported debt as of December 3 I, 1998 is $44,675,000 with sinking funds of 56,022,000 and escrow funds ofS1 1,578,000 as of December 31. 1998. (6) Metro Transit has bond indebtedness of $85,200,000, sinking funds of $22,567,000 and escrow funds of $1,327,000 as reported by Metropolitan Council as of December 31, 1998. n l...J r L r L r L - 36- r L ..., ...; ..., L.J Cash and Investment Balances as of Julv 31. 1999 (unaudited) Fund Name ..., ...J General Fund Special Revenue Funds Debt Service Funds Capital Project Funds Enterprise Funds Trust Funds $ 2,618,393 1,552,969 (I) 8,725,529 (2) 2,155,526 (3) 1,873,806 (4) 994.177 (5) $ 17.920.400' ..., ...J ..., ...J Total Cash and Investment Balances: ..., ...J ..., ...J ..., ...J ..., u ..., ....J ..., ....J ..., ...J ..., ....J ..., LJ ..., c..J ..., ....J ..., ....J ..., .....J . Breakdown of the various funds are on the following page. ..., - 37- -.J n LJ n u (I) Consists of the followine Special Revenue Funds: #202 Economic Development Authority Fund ($ 20,180.50) #225 Drainage and Mapping Fund 39,369.49 #226 Lower Rum River Water Management Fund 8,883.65 #227 Forestry Fund 21,620.35 #228 Trailffransportation Fund 162,438.01 #230 Septic Disposal Fund 6,973.16 #245 Capital Equipment Reserve Fund 1,033,594.66 #248 Developer's Sea1coating Fund 299,465.92 #250 Oak Wilt Suppression Fund 804.45 (2) Consists of the followine Debt Service Funds: #30 I 1992, 1994, I995C Certificate of Indebtedness Fund $ 19,663.16 #309 General Obligation Refunding Fire Bonds of 1998 Fund ( 29,431.84 ) #3 I 5 General Obligation Equipment Certificates of 1999 2,654.70 #319 EDA Public Project Revenue Bond of 1997 I22,353.20t #321 General Obligation Improvement Bonds of 1977 A Fund 580,266.70 #329 General Obligation Improvement Bonds of 1995B Fund 16,700.11 #333 General Obligation Refunding Bonds of 1986C Fund 722,119.50 #337 General Obligation Improvement Bonds of 1989A Fund 3,483.60) #342 General Obligation Improvement Bonds of 1993A Fund 143,447.87) #344 General Obligation Improvement Bonds of I994C Fund 144,658.20 #345 General Obligation Improvement Bonds of 1995A Fund 637,325.54 #346 General Obligation Improvement Bonds of 1996 795,415.77 #347 General Obligation Tax Increment Bonds of 1995D Fund 224,360.20 #348 General Obligation Improvement Bonds of 1997B Fund 2,714,944.76 #349 General Obligation Improvement Bonds of 1997 A Fund 1,829,344.02 #352 General Obligation Tax Increment Bonds of 1999 1,558.89) #378 General Obligation Tax Increment Bonds of 1993B 204,027.21 #379 General Obligation Refunding Bonds of 1994B 333,913.89 #397 Storm Sewer Trunk Fund (debt service portion) 102,810.12) #398 Water Trunk Fund (debt service portion) 87,225.34) #399 Sewer Trunk Fund (debt service portion) 745,739.23 (3) Consists of the followine Capital Proiect Funds: #40 I Revolving MSA Construction Fund ($ 481.444.33) #402 State Aid Projects Fund 809,493.92 #405 Park Dedication Fund 450,863.63 #412 Kelsey Road, Lake Park Phase II Fund 27,686.86 #415 General Obligation Equipment Certificates of 199 Fund 844,694.24 #420 Public Works Construction Fund 161,692.35 #447 TIF Commercial Revitalization Fund 639,736.25) #452 General Obligation Tax Increment Bonds of 1999 Fund 1,862,272.69 #499 Improvement Unfinanced Fund 1,040,403.57) #501 Permanent Improvements Revolving Fund 160,406.13 (4) Consists of the followine Enteltlrise Funds: #601 Water Fund $ 1,015,260.65 #602 Sewer Fund 858,545.41 (5) Consists of the followine Trust Funds: #701 Investrnent/Interest Fund $ 246,705.49 #702 Central Equipment Fund ( 59,867.72) #703 Risk Management Fund 93,551.47 #803 Escrow Fund 710,142.49 #805 Spruce Budworm Grant Fund 3,645.71 n LJ n u n u n u n LJ n LJ n LJ n LJ n .LJ n u n u n LJ r1 L r L r L These Debt Service Funds should be deducted when computing debt ratios since the bond issues are subtracted from general obligation debt figures. The total cash and investment balances available for debt ratios is 58,603,175.33. r L - 38- r L .., ....J .., LJ SUMMARY OF DEBT AND DEBT STATISTICS General Obliaation Debt .., ....J Bonds secured primarily by special assessments (includes this issue) Bonds secured primarily by tax increments Bonds secured solely by ad valorem taxes Total General Obligation Direct Debt Less Debt Service Funds $ 18,045,000 9,635,000 1.225.000 $ 28,905,000 ( 8.603.175) $ 20,301,825 23.840.745 $ 44.142.570 .., ....J .., L.J Net Direct General Obligation Debt Add City's share of net overlapping debt Total Net Direct and Net Overlapping Debt .., ....J .., L.J .., ....J EDA Soecial Obliaation Debt $2,350,000 Public Project Revenue Bonds of 1997 $2,315,000 ....., ....J .., L.J .., Facts for Ratio Comoutations 1998/1999 Indicated Market Value (real and personal property) 1998/1999 Net Tax Capacity (real and personal property after tax increment and fiscal disparity adjustments) Population (1999 Estimate) $1,185,004,792 $15,439,015 25,000 ...J .., ....J .., w .., w Debt Ratios Net Direct Net Net and Net Direct Direct Overlapping Overlapping Debt Debt Debt Debt To Indicated Market Value 2.44% 1.71% 2.01% 3.72% Per Capita $1,156 $812 $954 $1,766 Per Capita Adjustedl $1,078 $757 $889 $1,646 ....., L.J .., ...J .., ....J ..., J I The City's tax base is 5.79% commercial & industrial, .84% public utility and .16% railroad operating property, which has been deducted. --, -39- J $3,525,000 GENERAL OBLlGA TION IMPROVEMENT BONDS OF 1999 CITY OF ANDOVER, MINNESOTA (ANOKA COUNTY) CUMULATIVE BOND YEARS AND WORKSHEET n LJ n u n LJ (DEe. 1) CUMULATIVE YEAR AMOUNT BOND YEARS BOND YEARS 2000 $705,000 822,500 822.500 2001 705,000 1,527,500 2,350,000 2002 705,000 2,232.500 4,582.500 2003 705,000 2,937,500 7,520.000 2014 705,000 3,642.500 11,162,500 AVERAGE MATURITY: BONDS DATED: INTEREST PAYMENTS: REDEMPTION: BID: RATES: n u n LJ n u 3.16667 years, October 1, 1999. n LJ June 1, 2000, and semiannually thereafter on December 1 and June 1 and to registered owners of the Bonds appearing of record in the bond register as of the close of business on the fifteenth (15th) day (whether or not a business day) of the immediately preceding month, At the option of the Issuer, Bonds maturing after December 1,2001, shall be subject to prior payment on said date, and any interest pay- ment date thereafter, at a price of par and accrued interest. Redemp- tion may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the Bonds remaining unpaid which have the latest maturity date shall be prepaid first. If only part of the Bonds having a common maturity date are called for prepayment, the Issuer will notify DTC of the particular amount of such maturity to be pre- paid, DTC will determine by lot the amount of each participant'3 interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. Notice of such call shall be given by mailing a no- tice thereof by registered of certified mail at least thirty (30) days prior to the date fixed for redemption to the registered owner of each Bond to be redeemed at the address shown on the registered books, n LJ n u n LJ n .LJ n LJ n Sealed bids only for not less than $3,489,750, Good faith deposit for $70,500 must accompany bid, All rates must be in integral multiples of 1I20th or 1I8th of 1 %, No limitation is placed upon the number of rates that may be used, L.J r L r ESTIMATED CLOSING DATE: October 21,1999. L r L r L r l -40- r L ..., ....J ..., ....J PROPOSAL FORM HONORABLE CITY COUNCIL CITY OF ANDOVER ANDOVER,M~ESOTA FOR ALL OF THE $3,525,000 GENERAL OBLIGATION IMPROVEMENT BONDS OF 1999, OF YOUR CITY AS DESCRIBED IN THE OFFICIAL TERMS OF BOND SALE, WE WILL PAY YOU DOLLARS ($ ) (NOT LESS THAN $3,489,750) PLUS ACCRUED INTEREST FROM THE DATE OF SAID BONDS TO THE DATE OF DELIVERY, SAID BONDS SHALL BEAR INTEREST PAYABLE JUNE 1, 2000, AND SEMIANNUALLY EACH DECEMBER 1 AND JUNE 1 THEREAFTER AS FOLLOWS: DATED: SEPTEMBER 21, 1999 ..., ....J ..., ....J ..., L.J ..., ,~ % - 2000 % - 2001 % - 2002 % - 2003 % - 2004 ..., DESIGNATION OF SERIAL AND TERM MATURITIES ..J LAST YEAR OF SERIAL MATURITIES YEAR OF TERM MATURITIES ..., L.J PRINCIPAL WILL BE PAYABLE AT U,S, BANK TRUST NATIONAL ASSOCIATION, ST, PAUL, M~ESOTA, CUSIP NUMBERS WILL BE ISSUED AT THE COST OF THE SUCCESSFUL UNDERWRITER. THIS PROPOSAL IS FOR PROMPT ACCEPTANCE AND SUBJECT TO ALL TERMS IN THE OFFICIAL TERMS OF BOND SALE. WE ARE TO BE FURNISHED THE APPROVING LEGAL OPINION OF BOND COUNSEL, TOGETHER WITH THE DELIVERY OF THE PRINTED AND EXECUTED BONDS, WITHIN 40 DAYS AFTER A WARD OR AT OUR OPTION THEREAFTER. DELIVERY WILL BE MADE AT ..., L.J ..., ..J ..., ....J ..., (SPECIAL INSTRUCTIONS-SEE OVER), ACCOUNT MEMBERS: L..J ACCOUNT MANAGER ..., L.J BY: ACCEPTED FOR THE ADDRESSEE THIS DAY OF SEPTEMBER, 1999, ....., LJ BY: MAYOR ....., ATTEST: CITY CLERK ....J --..--.........----------------------------------------------------------..---- ..., WE COMPUTE OUR NET DOLLAR INTEREST COST TO BE $ FOR A NET INTEREST RATE OF %, THESE COMPUTATIONS ARE NOT A PART OF THIS OFFER. IT IS NOT NECESSARY TO USE THIS FORM; HOWEVER, ANY BID MUST COMPLY WITH THE TERMS STATED IN THIS OFFICIAL TERMS OF BOND SALE, ....J ..., ....J ....., -..J PLEASE SUBMIT THIS BID IN DUPLlCA TE ..., -41- J n LJ SPECIAL INSTRUCTIONS: n u n SALE RESULTS WILL BE FURNISHED BIDDERS AT 8:30 A.M, ON THE DAY AFTER THE SALE AT (651) 224-1500, IF RESULTS ARE DESIRED IMMEDIATELY, PLEASE COMPLETE THE FOLLOWING: LJ n LJ n u n L' CONTACT: n w TELEPHONE NUMBER: n LJ ...... - -.. - -........................................................... --.......................................................................... --...................... n u THE UNDERSIGNED HEREBY ACKNOWLEDGES RECEIPT FOR THE GOOD FAITH DEPOSIT IN THE AMOUNT OF $70,500 TO BE RETURNED TO THE UNSUCCESSFUL BIDDER. n u n 'LJ n LJ n LJ JURAN & MOODY n LJ r BY: L r L r L DATED: SEPTEMBER 21, 1999 ,.. L -42- r L ..., ....J ..., L...J APPENDIX A ..., ....J Proposed Form of Legal Opinion ..., ....J ..., ....J ..., ....J ..., ....J ..., .....J ....., ....J ..., ....J ..., L...J ..., L...J ....., ....J ....., ....J ..., .....J ..., ..J .., ...J -, ~ -., J n BRIGGS AND MORGAN 2200 FIRST 'lATIONAL RANK RUILDlNG 332 MINNESOTA STREET SAINT PAUL. MINNESOTA 55101 TELEPHONE (651) 223-6600 FACS1MILE (651)223-6450 u n u WRITER'S DIRECT DIAL n PROFESSIONAL ASSOCIATION u WRITER'S E-MAIL n u n PROPOSED FORM OF LEGAL OPINION u n u $3,525,000 GENERAL OBLIGATION IMPROVEMENT BONDS OF 1999 CITY OF ANDOVER ANORA COUNTY MINNESOTA n LJ n u We have acted as bond counsel in connection with the issuance by the City of Andover, Anoka County, Minnesota (the "Issuer"), of its $3,525,000 General Obligation Improvement Bonds of 1999, bearing a date of original issue of October 1, 1999 (the "Bonds") _ We have examined the law and such certified proceedings and other documents as we deem necessary to render this opinion. n LJ n LJ n We have hot been engaged or undertaken to review the accuracy, completeness or sufficiency of the Official Statement or other offering material relating to the Bonds, and we express no opinion relating thereto, 'LJ n LJ As to questions of fact material to our opinion, we have relied upon the certified proceedings and other certifications of public officials furnished to us without undertaking to verify the same by independent investigation, n l.J Based upon such examinations, and assuming the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified or photostatic copies and the authenticity of the originals of such documents, and the accuracy of the statements of fact contained in such documents, and based UDon oresent Minnesota and federal laws (which excludes any pendi;'g legislation which may have a retroactive effect on or before the date hereof), regulations, rulings and decisions, it is our opinion that: r L r L r L r L .. MINNE....ruLl5 OFFICE. IJS CENTER. WW'J.' RRICC::'.COM ."'-EMBER - LEX. Ml.::\DI. ...... GLOBAL .....S50ClATIC'J OF lNDHEl"DENT :..;..W FIRM~ L r l ..., ....; ..., L.J BRIGGS AND MORGAN ..., PROPOSED FORM OF LEGAL OPINION L.J ..., (1) The proceedings show lawful authority for the issuance of the Bonds according to their terms under the Constitution and laws of the State of Minnesota now in force. ....; ..., (2) The Bonds are valid and binding general obligations of the Issuer and all of the taxable property within the Issuer's jurisdiction is subject to the levy of an ad valorem tax to pay the same without limitation as to rate or amount; provided that the enforceability (but not the validity) of the Bonds and the pledge of taxes for the payment of the principal and interest thereon is subject to the exercise of judicial discretion in accordance with general principles of equity, to the constitutional powers of the United States of America and to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted, ....; ..., .-.J ..., d ..., ....; (3) At the time of the issuance and delivery of the Bonds to the original purchaser, the interest on the Bonds is excluded from gross income for United States income tax purposes and is excluded, to the same extent, from both gross income and taxable net income for State of Minnesota income tax purposes (other than Minnesota franchise taxes measured by income and imposed on corporations and financial institutions), and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations or the Minnesota alternative minimum tax applicable to individuals, estates or trusts; it should be noted, however, that for the purpose of computing the federal alternative minimum tax imposed on corporations, such interest is taken into account in determining adjusted current earnings. The opinions set forth in the preceding sentence are subject to the condition that the Issuer comply with all requirements of the Internal Revenue Code of 1986, as amended, that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon be, or continue to be, excluded from gross income for federal income tax purposes and from both gross income and taxable net income for State of Minnesota income tax purposes. Failure to comply with certain of such reauirements mav cause the inclusion of interest on the Bonds in gross income and taxable net income retroactive to the date of issuance of the Bonds, ..., ...J ..., ....; ..., ....; ..., ....; ..., ....; ..., ....; -, ...J We express no opinion regarding other state or federal tax consequences caused by the receipt or accrual of interest on the Bonds or arising with respect to ownership of the Bonds. -, -.J -. BRIGGS .~D MORGAN Profess~cnal Association ) -, J ~ J ...., -.J ...., -.J APPENDIX 8 ...., c..j Form of Continuing Disclosure Undertaking ...., u ...., -.J ...., -.J ...., -.J ...., -.J ...., -.J ...., -.J ....., -.J ...., -.J .., u ...., u ...., ..J ...., u ...., ..J ...., -.J -, ~ n LJ n u n FORM OF CONTINUING DISCLOSURE UNDERTAKING u n This Continuing Disclosure Undertaking (the "Disclosure Undertaking") is executed and delivered by the City of Andover, Minnesota (the "Issuer"), in connection with the issuance of $3,525,000 General Obligation Improvement Bonds of 1999 (the "Bonds"), The Bonds are being issued pursuant to a Resolution adooted Seotember 21, 1999 (the "Resolution"), Pursuant to the Resolution" and this Undertaking, the Issuer covenants and agrees as follows: u n LJ n LJ SECTION 1, puroose of the Disclosure Undertakincr. This Disclosure Undertaking is being executed and delivered by the Issuer for the benefit of the Owners and in order to assist the Participating Underwriters in complying with SEC Rule 15c2-12 (b) (5) . n LJ n LJ SECTION 2. Definitions. In addition to the definitions set forth in the Resolution, which apply to any capitalized term used in this Disclosure Undertaking unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: n LJ n "Annual Report" shall mean any annual financial information provided by the Issuer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Undertaking. u n "Audited Financial Statements" shall mean the financial statements of the Issuer audited annually by an independent certified public accounting firm, prepared pursuant to generally accepted accounting principles promulgated by the Financial Accounting Standards Board, modified by governmental accounting standards promulgated by the Government Accounting Standards Board. .LJ n u n LJ "Dissemination Agent" shall mean such party from time to time designated in writing by the Issuer to act as information dissemination agent and which has filed with the Issuer a written acceptance of such designation, r1 u "Fiscal Year" shall be the fiscal year of the Issuer. r L "Governing Body" shall, with respect to the Bonds, have the meaning given that term in Minnesota Statutes, Section 475,51, Subdivision 9. r L "MSRB" shall mean the Municipal Securities Rulemaking Board. r L 1076114.1 r L r l ...., ...j ...., u .., "National Repository" shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule, Currently, the following are National Repositories: '-.J .., Bloomberg Municipal Repository P,O, Box 840 Princeton, NJ 08542-0840 Phone: (609) 279-3200 Fax: (609) 279-5962 u .., u .., Thomson MuniCipal Services 395 Hudson Street - Third Floor New York, NY 10014 Attn: Municipal Disclosure Phone: (800) 689-8466 Fax: (212) 989-2078 ...j .., ...j .., Kenny Information Systems Inc. 65 Broadway - 16th Floor New York, NY 10006-2511 Attn: Repository Services Phone: (212) 770-4595 Fax: (212) 797-7994 ...j .., ...j .., DPe Data Inc, One Executive Drive Fort Lee, NJ 07024 Phone: (201) 346-0701; Fax: E-Mail: Nrmsir@dpcdata.com (201) 947-0107 ...j .., L.J "Occurrence(s)" shall mean any of the events listed in Section 5.A. of this Disclosure Undertaking, .., "Official Statement" shall be the Official Statement or Preliminary Official Statement dated , 1999 together with any addendum thereto, prepared in connection with the Bonds, L.J .., L.J "Owners" shall mean the registered holders and, if not the same, the beneficial owners of any Bonds, .., "Participating Underwriter" shall mean any of the original underwriters of the Bonds required to comply with the Rule in connection with offering of the Bonds, L.J .., ...j "Repository" shall mean each National Repository and each State Depository. .., "Resolution" shall mean the resolution or resolutions adopted by the Governing Body of the Issuer providing for, and authorizing the issuance of, the Bonds. ...j .., ....J 1076114.1 -, J -., J r-, u n u "Rule" shall mean Rule 15c2-12 (b) (5) adopted by the Securities and Exchange Commission under the Securities Exchanae Act of 1934, as the same may be amended f~om time to time or - interpreted by the Securities and Exchange Commission, n LJ n "State" shall mean the State of Minnesota. LJ "State Depository" shall mean any public or private repository or entity designated by the State as a state depository for the purpose of the Rule. As of the date of this Disclosure Undertaking, there is no State Depository in Minnesota. n u n u SECTION 3. Provision of Annual Reoorts, C. Beginning in connection with the Fiscal Year ending on December 31, 1999, the Issuer shall, or shall cause the Dissemination Agent to, not later than Decembe~ 31, 2000, and by December 31 of each year thereafter, provide to each Repository an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Undertaking. n u n u D. If the Issuer is unable to provide to the Repositories an Annual Report by the date required in subsection A, the Issuer shall send a notice of such delay and estimated date of delivery to each Repository or to the MSRB and to the State Depository, if any. n u n LJ SECTION 4. Content and Format of Annual Reoorts, The Issuer's Annual Report shall contain or incorporate by reference the financial information and operating data pertaining to the Issuer listed below as of the end of the preceding Fiscal Year. The Annual Report may be submitted to each Repository as a single document or as separate documents comprising a package, and may cross-reference other information as provided in this Disclosure Undertaking. n LJ n LJ r'1 The following financial information and operating data shall be supplied: l..J r A. an update of the type of information contained in the Official Statement under the caption ECONOMIC AND FINANCIAL INFORMATION; L r B, an update of the type of information contained in the Official Statement under the caption SUMMARY OF DEBT AND DEBT STATISTICS; L r L C. an update of the type of information contained in the Official Statement under the caption and subheadings r L 10761141 r l r ..., ...j ..., ....J ..., GENERAL INFORMATION - "Major Employers" and "Building Permits"; ....J ..., D, data extracted from preliminary, unaudited financial statements of the Issuer and from past Audited Financial Statements of the Issuer in the form and of the type contained in the Appendix of the Official Statement; and LJ ..., ....J E. Audited Financial Statements of the Issuer, The Audited Financial Statements of the Issuer may be submitted to each Repository separately from the balance of the Annual Report, In the event Audited Financial Statements of the Issuer are not available on or before the date for filing the Annual Report with the appropriate Repositories as set forth in Section 3.A. above, unaudited financial statements shall be provided as part of the Annual Report. The accounting principles pursuant to which the financial statements will be prepared will be pursuant to generally accepted accounting principles promulgated by the Financial Accounting Standards Board, as such principles are modified by the governmental accounting standards promulgated by the Government Accounting Standards Board, as in effect from time to time, If Audited Financial Statements are not provided because they are not available on or before the date for filing the Annual Report, the Issuer shall promptly provide them to the Repositories when available. ..., ....J ..., ....J ..., ....J ..., .J ..., ....J SECTION 5, ..., Renortina of Sianificant Events. ....J A. This Section 5 shall govern the giving of notices of the occurrence of any of the following events with respect to the Bonds, if material: ..., ....J ..., (1) principal and interest payment delinquency; LJ (2) non-payment related defaults; ..., (3) unscheduled draws on debt service reserves reflecting financial difficulties; LJ ..., LJ (4) unscheduled draws on credit enhancements reflecting financial difficulties; ..., (5) substitution of credit or liquidity providers, or their failure to perform; ....J (6) adverse tax opinions or events affecting the tax- exempt status of the security; ..., (7) modifications to rights of security holders; ...j 1076114.1 ..., -.J --, J n LJ n LJ (8) optional or unscheduled redemption of any Bonds; (9) defeasances; n LJ (10) release, substitution or sale of property securing repayment of the Bonds; and n L.J (11) rating changes. n B. Whenever an event listed in Section 5,A. above has occurred, the Issuer shall as soon as possible determine if such event would constitute material information for Owners of Bonds, If knowledge of the Occurrence would be material, the Issuer shall promptly file a notice of such Occurrence with each National Repository or the MSRB and with the State Depository, if any, LJ n LJ n C. The Issuer agrees to provide or cause to be provided, in a timely manner, to each National Repository or the MSRB and to the State Depository, if any, notice of a failure by the Issuer to provide the Annual Reports described in Seccion 4. LJ n u SECTION 6. Termination of Reoortina Obliaation. The Issuer's Bonds under this Disclosure Undertaking shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. n LJ n SECTION 7. Dissemination Aaent. The Issuer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its Bonds under this Disclosure Undertaking, and may discharge any such Agent, with or without appointing a successor Dissemination Agent. LJ n 'L.J SECTION 8. Amendment: Waiver, Notwithstanding any other provision of this Disclosure Undertaking, the Issuer may amend this Disclosure Undertaking, and any provision of this Disclosure Undertaking may be waived, if (a) a change in law or change in the ordinary business or operation of the Issuer has occurred, (b) such amendment or waiver would not, in and of itself, cause the undertakings herein to violate the Rule if such amendment or waiver had been effective on the date hereof but taking into account any subsequent change in or official interpretation of the Rule, and (c) such amendment or waiver is supported by an opinion of counsel expert in federal securities laws to the effect that such amendment or waiver would not materially impair the interests of Owners, n LJ n u n L.J r L SECTION 9. Additional Information. Nothing in this Disclosure Undertaking shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Undertaking or any other means of communication, or including any other information r L r L 10761141 r L r I.. I..., c.J ..., LJ ..., in any Annual Report or ~otice of an Occurrence, in addition to that which is required by this Disclosure Undertaking. If the Issuer chooses to include any information in any Annual Report or notice of an Occurrence in addition to that which is specifically reauired by this Disclosure Undertaking, the Issuer shall have no obiigacion under this Disclosure Undercaking to update such informacion or include it in any future Annual Report or notice of an Occurrence, ...J ..., L1 -1 ...J SECTION 10. Default. In the event of a failure of the Issuer to provide information required by this Disclosure Undertaking, any Owner may take such actions as may be necessary and appropriate, including seeking mandamus or specific performance by court order, to cause the Issuer to comply with its Bonds to provide information under this Disclosure Undertaking, A default under this Disclosure Undertaking shall not be deemed an Event of Default under the Resolution, and the sole remedy under this Disclosure Undertaking in the event of any failure of the Issuer to comply with this Disclosure Undertaking shall be an action to compel performance, ..., L1 ..., o...J ..., c.J ...., c.J SECTION 11. Beneficiaries. This Disclosure Undertaking shall inure solely to the benefit of the Issuer, the Participa- ting Underwriters and Owners from time to time of the Bonds, and shall create no rights in any other person or entity. ..., SECTION 12, Reserved Riahts. The Issuer reserves the right to discontinue providing any information required under the Rule if a final determination should be made by a court of competent jurisdiction that the Rule is invalid or otherwise unlawful or, subject to the provisions of Section 8 hereof, to modify the undertaking under this Disclosure Undertaking if the Issuer determines that such modification is required by the Rule or by a court of competent jurisdiction. .....J ..., .....J ..., o...J ..., ...J ..., o...J ..., .....J ..., ...J .., -.J 1076114.1 ...., j ., j .., LJ .., ...J APPENDIX C .., City's Financial Statements LJ .., The following fmancial statements are excerpts from the annual financial report for the year ended December 31, 1998. The complete financial report for the year 1998 and the prior two years are avail- able for inspection at the Andover City Hall and the St. Paul office of Juran & Moody, The reader of this Official Statement should be aware that the complete financial report may have further data relat- ing to the excerpts presented in the appendix which may provide additional explanation, interpretation or modification of the excerpts. LJ .., LJ .., ExcerDts from the Financial ReDort . Combined Balance Sheet - All Fund Types and Account Groups · Combined Statement of Revenues, Expenditures and Changes in Fund Balance - All Governmental Fund Types and Expendable Trust Funds · Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General, Special Revenue and Debt Service Fund Types · Combined Statement of Revenues, Expenses and Changes in Retained Earnings - All Proprietary Fund Types · Combined Statement of Cash Flows - All Proprietary Fund Types LJ .., ;"j .., ....J .., LJ .., . Notes to the Financial Statements ..J .., ....J .., LJ .., LJ .., LJ .., LJ .., LJ .., ...J .., ...J .., ..J n L.J CITY OF ANDOVER. MINNESOTA COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS December 3 I, 1998 ASSETS AND OTHER DEBITS Assets: Cash and Investments (Including Cash Equivalents) Cash with Trustee Taxes Receivable- Delinquent Special Assessments Receivable - Deferred Delinquent AccountslLoans Receivable Interest Receivable Due from Other Governmental Units Inventory Prepaid Items Property, Plant and Equipment - Net Other Debits: Amount Available in Debt Service Fund Amount to be Provided for Retirement of General Long-Term Debt TOTAL ASSETS AND OTHER DEBITS LIABILmES, EQUITY AND OTHER CREDITS Liabilities: Accounts Payable Accrued Items Contracts Payable Due to Other Governmental Units Deposits Payable Due to Employees Deferred Revenue Special Assessments on City Property Bonds and Certificates Payable Total Liabilities Equity and Other Credits: Investment in General Fixed Assets Contributed Capital Retained Earnings - Unreserved Fund Balance (Dcficit) - Rcserved Unreserved - Designalcd Undesignaled Total Equiry and Other Credits TOTAL LIABILITIES, EQUITY AND OTHER CREDITS n LJ n Governmental Fund Types Special Debt Capital General Revenue Service Proiects S 2.293.745 S 2,071.235 S 7.354,976 S 2,242,682 0 0 0 0 76,608 557 74,551 0 46 0 5,938,798 2,376,610 257 0 10,162 59,480 41.542 105 0 126,213 96,286 60,621 274,607 174,984 153,664 3,084 135,945 294,490 60,349 0 0 0 8,854 0 0 2,175 0 0 0 0 0 0 0 0 0 0 0 0 S 2.731,351 S 2,\ 35.602 S 13,789,039 S 5,276,634 S 96,524 S 5,296 S 5,943 S 131,667 72,730 492 0 0 0 0 0 139,281 36,763 0 0 0 0 0 0 0 0 0 0 0 76,911 468,381 6,023,511 2,552.113 0 0 0 0 0 0 0 0 282,928 474,169 6,029,454 2,823,061 0 0 0 0 0 0 0 0 0 0 0 0 69,203 0 7,770,700 0 2,196,484 0 0 3,378,408 182,736 1.661,433 (11,115) (924.835) 2,448,423 1.661.433 7,759.585 2,453.5i3 S 2.731.351 S 2.135.602 S 13.789.039 S 5.276.634 L.J n LJ n u n LJ n LJ n u n LJ n LJ n 'LJ n LJ n LJ r"1 u n LJ r L r L r- The notes to the finOlncial statements arc an integral pan of this statement. L r L ...., LJ ...., ....J ...., Proprietary Fiduciary ....J Fund Types Fund Tvpe Account Groups General General Totals Internal Trust and Fixcd Long-Tcrm (Memorandum Onlv) ...., Enterprise Service A~cncy Assets Debt 1998 1997 ....J S 1,691,755 S 138,542 S 445,363 S 0 S 0 S 16,238,298 S 17,876,791 ...., 0 0 0 0 0 0 307,954 ....J 0 0 0 0 0 151,716 50,238 ...., 0 0 0 0 0 8,315,454 5,573,911 2,443 0 0 0 0 72,342 32,174 ....J 462,716 404 0 0 0 630,980 577,608 81,757 6,952 0 0 0 695,207 684,450 3,094 0 0 0 0 590,277 424,207 ...., 14,165 17,316 0 0 0 91,830 64,943 ....J 38,122 0 0 0 0 49,151 50,805 22,887,863 0 0 11,805,159 0 34,693,022 31,618,671 ...., 0 0 0 0 7,759,585 7,759,585 5,904,866 ....J 0 0 0 0 19,888,284 19,888,284 25,571.653 ...., S 25.181.915 S 163.214 S 445.363 S 11,805,159 S 27,647.869 S 89,176,146 S 88,738.271 ....J ...., S 19,008 S 8,195 S 4,355 S 0 S 0 S 270,988 S 666,037 23,714 833 0 0 179,274 277,043 244,394 ....J 0 0 0 0 0 139,281 458,146 484 0 0 0 0 37,247 32,699 0 0 441,008 0 0 441,008 373,692 ...., 0 4,569 0 0 0 4,569 314,701 ....J 534 0 0 0 0 9,121,450 6,046,792 0 0 0 0 118,595 118,595 145,051 0 0 0 0 27.350.000 27,350,000 31,175,000 ...., 43,740 13,597 445,363 0 27,647,869 37,760,181 39,456,5 i2 ....J 0 0 0 11,805,159 0 11,805,159 1 J ,442,464 ...., 22,754,745 0 0 0 0 22,754,745 20,020,983 ....J 2,383,430 149,617 0 0 0 2,533,047 2,268,705 0 0 0 0 0 7,839,903 6,121,861 ...., LJ 0 0 0 0 0 5,574,892 9,877,323 0 0 0 0 0 908,219 (449,577) 25,138,175 149,617 0 11.805,159 0 51.4 I 5.965 49.281.759 ...., U S 25.181.915 S 163.214 S 445.363 S 11.805.159 S 27.647.869 S 89.176.146 S 88.738.271 ...., ....J ...., ....J ...., ....J ...., ..J n CITY OF ANDOVER, MINNESOTA LJ COMBINED STATEMENT OF REVENUES, EXPENDITURES, n AND CHANGES IN FUND BALANca....ALL GOVERNMENTAL FUNDS LJ AND EXPENDABLE TRUST FUNDS Year Ended December 31, 1998 n LJ Governmental Fund Types n SpecIal Debt LJ General Revenue Service REVENUES: n General Property Taxes and Tax Increments $ 2,804,065 $ 13,889 $ 1,170,086 Special Assessments 0 0 3,299,872 LJ Licenses and Permits 694,809 0 0 Intergovernment:ll 880,697 12,546 171,530 n Charges for Services 1,018,441 37,330 0 LJ Fines 48,923 0 0 Miscellaneous 358,435 205,034 635,771 n Total Revenues 5,805,370 268,799 5,277,259 LJ EXPENDITURES: n Current - General Government 1,551,410 0 0 LJ Public Safety 1,528,282 0 0 Public Works 1,005,394 71,213 0 n Sanitation 101,039 0 0 LJ Parks and Recreation 461,131 0 0 Recycling 76,773 0 0 n Economic Development 0 102,062 0 Miscellaneous 75,950 0 0 LJ Capital Outlay 0 175,710 0 Debt Service 0 0 6,122,591 n Total Expenditures 4,799,979 348,985 6,122,591 LJ EXCESS OF REVENUES OVER (UNDER) n EXPENDITURES 1,005,391 (80,186) (845,332) LJ OTHER FINANCING SOURCES (USES): ,..., Operating Transfers In 464,020 285,718 2,011,626 Operating Transfers Out 0 (50,000) 0 LJ Bond Proceeds 0 0 746,701 Proceeds from Sale of Property 2,303 0 0 n Total Other Financing Sources (Uses) 466,323 235,718 2,758,327 LJ EXCESS OF REVENUES AND OTHER n SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES 1,471,714 155,532 1,912,995 u HIND BALANCE - January 1 1,846,747 447,263 5,904,366 n u RESIDUAL EQUITY TRANSFER (370,038) 1,058,638 (58,276) n HJND BALANCE - December 31 S 2.448.423 S 1,661,433 S 7.759.585 LJ The notes to the financial statements are an integral part of this statement. n L r L -~ ..., ...J ..., ~J ..., ...J ..., Fiduciary Fund Type Totals ...J CapItal Expendable (Memorandwn Only) Projects Trust 1998 1997 ..., ...J $ 0 $ 0 $ 3,988,040 $ 3,653,372 1,360,327 0 4,660,199 3,813,021 ..., 0 0 694,809 456,413 987,026 0 2,051,799 2,128,459 ...J 0 0 1,055,771 609,094 0 0 48,923 48,800 ..., 2,257,744 0 3,456,984 2,248,602 ...J 4,605,097 0 15,956,525 12,957,761 ..., ...J 0 0 1,551,410 1,252,047 0 0 1,528,282 1,409,087 ..., 0 0 1,076,607 1,122,223 ...J 0 0 101,039 95,632 0 0 461,131 383,059 ..., 0 0 76,773 62,281 ...J 0 0 102,062 73,993 0 274 76,224 212,503 ..., 7,138,411 0 7,314,121 12,177,076 0 0 6,122,591 9,253,963 ...J 7,138,411 274 18,410,240 26,041,864 ..., ...J (2,533,314) (274) (2,453,715) (13,084,103) ..., 395,836 0 3,157,200 6,734,406 ...J (2,707,962) (33,020) (2,790,982) (6,599,406) 0 0 746,701 12,220,090 ...., 0 0 2,303 44,242 LJ (2,312,126) (33,020) 1,115.222 12,399,332 ..., u (4,845,440) (33,294) (1,338,493) (684,771) ..., 7,317,437 33,294 15,549,607 16,234,378 L..J (18,424) 0 111,900 0 ..., ...J S 2.453,573 S 0 S 14,323.014 S 15,549.607 ..., ...J ..., ...j n LJ cln' OF ANDOVER. MINNESOTA n COMBINED STATEMENT OF REVENUES, EXPENDITIJRES AND CHANGES IN FUND BALANCE. BUDGET AND ACTUAL. GENERAL, SPECIAL REVENUE AND DEBT SERVICE FUND TIPES Year Ended December 3 I, 1998 LJ n LJ General Fund Soecial Revenue Ovcr (Under) Bud~et Actual Budget Bud~et Actual REVENUES: General Property Taxes and S 2,904,311 S 2,804,065 S (100,246) S 14,090 S 13,889 and Tax Increments Special Assessments 0 0 0 0 0 Licenses and Permits 627,615 694,809 67,194 0 0 Intergovernmental 896,137 880,697 (15,440) 2,539 12,546 Charges for Services 654,800 1,018,441 363,64 I 68,016 37,330 Fines 41,300 48,923 7,623 0 0 Miscellaneous 196,746 358,435 161,689 84,866 205,034 Total Revenues 5,320,909 5,805,370 484,461 169,511 268,799 EXPENDITIJRES: Current - General Government 1.599,627 1.551,410 (48.217) 0 0 Public Safcty 1,598,069 1,528.282 (69,787) 0 0 Public Works 1,446,866 1,005,394 (441,472) 80,461 71,213 Sanitation 170,017 101.039 (68,978) 0 0 Parks and Recreation 474,092 461,131 (12,961) 0 0 Recycling 77,153 76,773 (380) 0 0 Economic Development 0 0 0 111,560 102,062 Miscellaneous 490,045 75,950 (414,095) 0 0 Capital Outlay 0 0 0 101,131 175,710 Debt Service 0 0 0 0 0 Total Expenditures 5,855.869 4,799,979 (1,055,890) 293,152 348.985 EXCESS OF REVENUES OVER (UNDER) EXPENDITURES (534,960) 1,005,391 1,540,351 (123,641) (80,186) OTIIER FINANCING SOURCES (USES): Operating Transfers In 546,660 464,020 (82,640) 275,718 285,718 Operating Transfers Out (14,000) 0 14,000 0 (50,000) Bond Proceeds 0 0 0 0 0 Proceeds from Sale of Property 2,300 2,303 3 28,560 0 Total Other Financing Sources (Uses) 534,960 466,323 (68,637) 304,278 235,718 EXCESS OF REVENUES AND OTHER SOURCESOVER(UNDER)EXPEND~ AND OTHER USES S 0 1,471,714 S 1.471.714 S 180.637 155,532 FUND BALANCE - January I 1,846,747 447,263 RESIDUAL EQUITY TRANSFER (870,038) 1.058.638 FUND BALANCE - Dcecrnbcr 31 S 2.448.423 S 1.661.433 n LJ n LJ n LJ n LJ n LJ n LJ n LJ n 'LJ n LJ n u n u n LJ n LJ ,.., L r Thc nOICS to thc financial statcrncnts arc :10 integral part of this Stalcmcnl. L r L ....., c..J ....., U ....., c..J Totals ....., Funds Debt Service Funds (Memorandum Onlv) OVcT Over Over u (Under) (Undcr) (Under) Budget Budget Actual Budget Budget Actual Budget ....., S (201) S 1,082,484 S 1,170,086 S 87,602 S 4,000,885 S 3,988,040 S (12,845) LJ 0 1,122,155 3,299,872 2,177,717 1,122,155 3,299,872 2,177,717 ....., 0 0 0 0 627,615 694,809 67,194 10,007 171,626 171,530 (96) 1,070,302 1,064,773 (5,529) ....J (30,686) 0 0 0 722,816 1,055,771 332,955 0 0 0 0 41,300 48,923 7,623 ....., 120,168 295,880 635,771 339,891 577,492 1,199,240 621,748 99,288 2,672,145 5,277,259 2,605,114 8,162,565 11,351,428 3,188,863 '-.J ....., 0 0 0 0 1,599,627 1,551,410 (48,217) ....J 0 0 0 0 1,598,069 1,528,282 (69,787) (9,248) 0 0 0 1,527,327 1,076,607 (450,720) 0 0 0 0 170,017 101,039 (68,978) ....., 0 0 0 0 474,092 461,131 (12,961) 0 0 0 0 77,153 76,773 (380) LJ (9,498) 0 0 0 I I 1,560 102,062 (9,498) 0 0 0 0 490,045 75,950 (414,095) ....., 74,579 0 0 0 101,131 175,710 74,579 0 5,353,558 6,122.591 769,033 5,353,558 6,122.591 769,033 L.J 55,833 5,353.558 6,122,591 769,033 11,502,579 5,148,964 (23 1,024) ....., 43,455 (2,681,413) (845,332) 1,836,081 (3,340,014) 79,873 3,419,887 ..J ....., 10,000 30,000 2,011,626 1,981,626 852,378 2,761,364 1,908,986 (50,000) 0 0 0 (14,000) (50,000) (36,000) ..J 0 0 746,701 746,701 0 746,701 746,701 (28,560) 0 0 0 30,860 2,303 (28,557) ....., 168,560) 30,000 2,758,327 2,728,327 869,238 3,460,368 2,591,130 L.J $ (25.105) $ (2.651.413) 1,912,995 $ 4.564.408 $(2.470.776) 3,540,241 S 6.011.017 ....., LJ 5,904,866 8,198,876 (58,276) 130,324 ....., ....J S 7.759.585 S 11.869.441 ....., ....J ....., '-.J ....., '-.J ....., ....J CITY OF ANDOVER, MTh'NESOTA COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS - ALL PROPRlET ARY FUNDS Year Ended December 31, 1998 With Comparative Totals for the Year Ended December 31,1997 Enterprise OPERATING REVENUES: User Charges Meters Permit Fees Penalties Other Total Operating Revenues $ 1,738,249 65,122 18,975 29,694 4,671 1,856,711 OPERATING EXPENSES: Personal Services Supplies Other Services and Charges Disposal Charges Depreciation Total Operating Expenses 427,512 65,735 123,991 542,883 617,789 1,777,910 78,801 . OPERATING INCOME (LOSS) NON-OPERATING REVENUES: Investment Income 139,297 INCOME (LOSS) BEFORE OPERATING TRANSFERS 218,098 30,500 (396,718) (366,218) (148,120) Operating Transfer In Operating Transfer Out Total Operating Transfers NET INCOME (LOSS) Add: Depreciation Charged Against Contributed Capital 475,181 RETAINED EARNINGS - January 1 2,163,269 (I06,900) $ 2,383.430 RESIDUAL EQUITY TRANSFER RETAINED EARNINGS - December 31 Internal Service $ 359,302 o o o 1,895 361,197 126,921 128,674 67,815 o o 323,410 37,787 11,394 49,181 o o o 49,181 o 105,436 (5,000) S 149,617 The notes to the financial statements are an integral pan of this statement. n u n LJ n LJ Totals (Memorandum Only) 1998 1997 $ 2,097,551 65,122 18,975 29,694 6,566 2,217,908 554,433 194,409 191,806 542,883 617,789 2,101,320 116,588 150,691 267,279 30,500 (396,718) (366,218) (98,939) 475,181 2,268,705 (I 11,900) $ 2,533.047 n LJ $ 1,865,190 37,180 12,082 24,314 454 1,939,220 n LJ n u 448,357 225,089 258,948 518,571 603,269 2,054,234 n LJ n LJ (115,014) n LJ 92,638 n LJ (22,326) 6,000 (141,000) (135,000) n .u n (157.326) LJ n 475,180 1,950,851 o u ,.., u S 2,268,705 ,.., u n LJ n LJ n u n LJ ..., ..J ..., ..J CITY OF ANDOVER, MINNESOTA COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES Year Ended December 31, 1998 With Comparative Totals for the Year Ended December 31,1997 Totals Internal (Mcrnornndurn Only) Enterprise Service 1998 1997 CASH FLOWS FROM OPERATING ACTIVITIES: Opernting Income (Loss) S 78,801 $ 37,787 $ 116,588 S (115,014) Adjustments to Reconcile Operating Income to Net Cash Provided (Used) by Operating Activities: Depreciation 617,789 0 617,789 603,269 Change in Current Assets and Liabilities: Decrease in Special Assessments 10,371 0 10,371 901 (Increase) in Accounts Receivable (64,618) (231) (64,849) 203,718 (Increase) Decrease in Due From Other Government Units 10,268 0 10,268 2,415 (Increase) Decrease in Inventory (1,475) (1,620) (3,095) 3,004 (Increase) Decrease in Prepaid Items 7,837 465 8,302 2,885 Increase (Decrease) in Accounts Payable (4,452) 4,288 (164) (8,302) Increase in Accrued Items (6,868) (3,022) (9,890) 12,656 (Decrease) in Due to Other Governmental Units (150) 0 (150) (2,004 ) (Decrease) in Deferred Revenue (1,498) 0 (1,498) (900) Total Adjustments 567,204 (120) 567,084 817,642 Net Cash Provided by Operating Activities 646,005 37,667 683,672 702,628 CASH FLOWS FROM NONCAPITAL FINANCING ACTNITIES: Transfers From Other Funds 30,500 0 30,500 6,000 Transfers To Other Funds (503,618) (5,000) (508,618) (141,000) Net Cash Used by Noncapital Financing Activities (473,118) (5,000) (478,118) (J 35,000) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Acquisition of Fixed Assets (120,501) 0 (120,501) (101,528) CASH FLOWS FROM INVESTING ACTIVITIES: Investment Income 111,316 7,633 118,949 66,890 NET INCREASE IN CASH AND CASH EQUIVALENTS 163,702 40,300 204,002 532.990 CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 1,528,053 98,242 1,626.295 1,093,305 CASH AND CASH EQUIVALENTS. END OF YEAR S 1,691,755 S 138.542 S 1.830.297 S 1,626.295 ..., ....J ..., ..J ..., ....J ..., ....J ..., u ..., ....J ..., u ..., u ..., ...j .-, ....J ..., L.J ..., L.J ..., L.J ..., ....J ..., ...j ..., The nOlcs to thc fin:mcial SlalCmCnlS arc an intcgrnl pan of this slatcmcnL ...j ..., ...j n lJ n LJ CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 n LJ n NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES LJ A. Accounting Policies of the Citv n u The accounting policies of the City conform to generally accepted accounting principles as applicable to governments. With respect to proprietary activities, the City has applied all applicable Governmental Accounting Statement Board (GASB) pronouncements as well as Financial Accounting Standards Board (FASB) pronouncements and Accounting Principles Board (APB) Opinions issued on or before November 30, 1989 unless those pronouncements conflict with or contradict GASB pronouncements, In accordance with GASB Statement No, 20, the City has elected to apply only GASB pronouncements issued after November 30, 1989. n u n LJ n B. Financial Reporting Entitv LJ In accordance with GASB Statement No, 14, The Financial Reporting Entity, the financial statements present the City and its component units, The City includes all funds, account groups, organizations, institutions, agencies, departments and offices that are not legally separate from such. Component units are legally separate organizations for which the elected officials of the City are financially accountable and are included within the general purpose financial statements of the City because of the significance of their operational or financial relationships with the City, n U n LJ n The City is considered financially accountable for a component unit if it appoints a voting majority of the Organization's governing body and it is able to impose its will on the Organization by significantly influencing the programs, projects, activities, or level of services performed or provided by the Organization, or there is a potential for the Organization to provide specific financial benefits to, or impose specific financial burdens on, the City, 'U ,...., U n As a result of applying the component unit definition criteria above, it has been determined the City has one blended component unit. u Blended Component Unit - The Andover Economic Development Authority (EDA) is a legal entity separate from the City, Although legally separate, the EDA is reported as if it were part of the primary government because its governing body is substantively the same as the governing body of the primary government. n LJ n u n LJ .... L ,... L ,.... L ..., ....J ..., c.J ..., CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31,1998 (Continued) c.J ..., c.J ..., NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) .J C. Fund Accounting ..., The accounts of the City are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Government resources are allocated and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped, in the financial statements in this report, into eight generic fund types and three broad.fund categories, described below. Governmental Funds c.J ..., c.J ..., c.J ..., The General Fund is the general operating fund ofthe City. It is used to account for all financial resources except those required to be accounted for in another fund. c.J ..., Soecial Revenue Funds are used to account for the proceeds of specific revenue sources (other than expendable trusts or major capital projects) that are legally restricted to expenditures for specified purposes, c.J ..., Debt Service Funds are used to account for the accumulation of resources for, and the payment of, general long-term debt principal, interest and related costs. c.J -, Caoital Proiects Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds), c.J ..., Proorietarv Funds ....J -, Enternrise Funds are used to account for operations (a) that are financed and operated in a manner similar to private business enterprises--where the intent of the governing body is that the costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges; or (b) where the governing body has decided that the periodic determination of revenues earned, expenses incurred, or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. The City maintains Water and Sewer Enterprise Funds. c.J ....., L.J ..., ....J ..., c.J -, ....J ....., ....J r"' LJ r"' LJ CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) r"' LJ r"' LJ NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) n C. Fund Accounting (Continued) LJ Internal Service Funds - Internal service funds are used to account for the financing of goods or services provided by one department or agency to other departments or agencies of the City. The City's Central Equipment Maintenance Fund is used to account for the City's Equipment Operations to all City departments on a cost reimbursement basis, n LJ ,..., Fiduciary Funds LJ Exoendable Trust Funds are used to account for assets held by the government in a trustee capacity. Both principal and earnings may be spent for the trust's intended purpose. Agencv Funds are used to account for assets held by the City as an agent for individuals, private organizations, other governments and/or other funds. The City's Agency Fund is custodial in nature and does not involve measurement of results of operations. ,..., Lj n LJ n D. Measurement Focus. Fixed Assets and Long-Term Liabilities LJ The accounting and reporting treatment applied to the fixed assets and long-term liabilities associated with a fund are determined by its measurement focus. All governmental funds are accounted for on a spending or "financial flow" measurement fccus. This means that only current assets and current liabilities are generally included on their balance sheets. Their reported fund balance (net current assets) is considered a measure of available spendable resources, Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of available spendable resources during a period. ,..., .u ,..., LJ ....., LJ Fixed assets used in governmental fund type operations (general fixed assets) are accounted for in the General Fixed Assets Account Group, rather than in governmental funds. Public domain ("infrastructure") general fixed assets--which are certain improvements other than buildings, including roads, curbs and gutters, streets and sidewalks, drainage systems, and lighting systems--are not capitalized by the City. No depreciation has been provided on general fixed assets, r"' u n u All fixed assets are valued at their historical cost or estimated historical cost if actual cost is not available. Donated fixed assets are valued at their estimated fair value on the date donated. ,..., LJ r"' LJ ,..., u ,..., LJ ...., -....J ...., -....J ...., CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) -....J ...., -....J ...., NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) --.J D. Measurement Focus. Fixed Assets and Long-Term Liabilities (Continued) ..., Long-term liabilities expected to be financed from governmental funds are accounted for in the General Long-Term Debt Account Group, not in the governmental funds, -....J ...., The two account groups are not "funds". They are concerned only with the measurement of financial position. They are not involved with measurement of results of operations, ..J Because of their spending measurement focus, expenditure recognition for governmental fund types is limited to exclude amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. They are instead reponed as liabilities in the General Long-Term Debt Account Group, ..., --.J ...., LJ All proprietary funds are accounted for on a flow of economic resources measurement focus, This means that all assets and all liabilities (whether current or non-current) associated with the fund's activity are included on the balance sheet. Proprietary fund type operating statements present increases (revenues) and decreases (expenses) in net total assets. ...., ..J ..., Depreciation of all exhaustible fixed assets used by proprietary funds is charged as an expense against operations. Accumulated depreciation is reported on the proprietary fund balance sheet. Depreciation has been provided over the assets' estimated useful lives using the straight-line method. u ..., --.J Estimated useful lives are as follows: ...., Buildings and Improvements Equipment 5-50 Years 5-20 Years u ...., E. Basis of Accounting --.J Basis of accounting re[ers to when revenues and expenditures or expenses are recognized in the accounts and reponed in the financial statements, Basis of accounting relates to the timing of the measurement made, regardless of the measurement focus applied. ...., -....J All governmental [unds are accounted [or using the modified accrual basis of accounting, in which revenues are recognized when they become measurable and available as net current assets. ..., '-.J ...., ...J -, ....J ...., --.J ....., LJ n LJ CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) ~ LJ n LJ NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) n E. Basis of Accounting (Continued) The City considers property taxes as available if they are collected within 60 days after year end. A one-year availability period is used for revenue recognition for all other governmental fund revenues. Expenditures are recorded when the related fund liability is incurred. Principal and interest on general long-term debt are recorded as fund liabilities when due or when amounts have been accumulated in the debt service fund for payments to be made early in the following year. LJ ....., LJ ~ L..; Major revenues that are susceptible to accrual include property taxes, intergovernmental revenues, charges for services, and interest on investments. Major revenues that are not susceptible to accrual include licenses and permits, fees and miscellaneous revenues; such revenues are recorded only as received because they are not measurable until collected, n L.J ....., Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liabilities are incurred, Exceptions to this rule include sick pay and principal and interest on general long-term debt, which are recognized when due, LJ n LJ All proprietary funds are accounted for using the accrual basis of accounting; revenues are recognized when they are earned and expenses are recognized when they are incurred, Unbilled utility service receivables are recorded at year end. ~ w The City reports deferred revenue on the combined balance sheet. Deferred revenues arise when a potential revenue does not meet boIh the "measurable" and "available" criteria for recognition in the current period. Deferred revenues also arise when resources are received by the City before it has a legal claim to them, or when grant monies are received prior to the incurrence of qualifying expenditures, In subsequent years, when both revenue recognition criteria are met, or when the City has a legal claim to the resources, the liability for deferred revenue is removed from the combined balance sheet and the revenue is recognized. F. Budgetarv Accounting ,., LJ ....., L...J r LJ Budgets are adopted on a basis consistent with generally accepted accounting principles, Annual appropriated budgets are adopted for the general fund, special revenue funds, and debt service funds and a separate budget report is issued at the beginning of each year. n u Budgeted amounts are as originally adopted or as amended by the City Council. Such amendments were not material. Encumbrances are not used by the City. Budgeted expenditure appropriations lapse at year end. n u n LJ ,...., LJ r L ...., u ...., .....J ...., CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) u ...., u ...., NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) u F. Budgetary Accounting (Continued) ...., The City follows these procedures in establishing the budgetary data reflected in the financial statements: u ...., 1. The City Administrator submits to the City Council a proposed operating budget for the fiscal year commencing the following January 1. The budget includes proposed expenditures and the means of financing them, u ...., 2. Public hearings are conducted to obtain taxpayer comments, L.J ...., 3, The budget is legally enacted through City Council action, 4. Expenditures may legally exceed budgeted appropriations at the fund level through City Council action. Also, the City Council may authorize transfers of budgeted amounts between departments within any fund, .....J ...., .....J . 5, Formal budgetary integration is employed as a management control device during the year for the general fund, special revenue funds and debt service funds. Budgetary control for capital projects funds is accomplished through the use of project controls. ..., .....J ...., 6, The legal level of budgetary control is at the department level for the General Fund and at the fund level for the special revenue and debt service funds. Also inherent in this controlling function is the management philosophy that the existence of a particular item or appropriation in the approved budget does not automatically mean that it will be spent. The budget process has flexibility in that, where need has been properly demonstrated, an adjustment can be made within the department budget by the City Administrator or between departments by the City Council. .....J ...., u ..., G, Encumbrances .....J ...., Encumbrances outstanding at year-end expire and outstanding purchase orders are cancelled and not reported in the financial statements. .....J H. Cash and Investments (Includin!! Cash Eouivalents) (See Notc 3) ...., C::Ish balances from ::Ill funds ::Irc combined ::Ind invested to the extent available in authorized investments. Earnings from such investments are allocated to the respective funds on the basis of applicable cash b::llancc panicipation by each fund. u ..., :...J ..., .....J ..., '-.1 n LJ n LJ CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) n LJ n u NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) n H. Cash and Investments (Including Cash Eouivalents) (See Note 3) (Continued) The City has implemented Governmental Accounting Standards Board (GASB) Statement No. 31 whereby investments are reported at fair value as of December 31, 1998, Money market investments such as commercial paper that have a remaining maturity at time of purchase of one year or less are recorded at amortized cost. u n u n For purposes of the Statement of Cash Flows of proprietary fund types, cash equivalents are defined as short-term, highly liquid investments that are both: LJ n a. readily convertible to known amounts of cash, or b. so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. LJ n The City's policy considers cash equivalents to be those that meet the above criteria and have original maturities of three months or less. LJ n 1. Taxes Receivable LJ Delinquent taxes receivable represent the past six years of uncollected tax levies, n LJ ], SDecial Assessments n Special assessments represent the financing for public improvements paid for by benefiting property owners. These assessments are recorded as receivables upon certification to the county or upon completion of the project costs and passage of a Council resolution with the actual certification taking place subsequent to year-end. The corresponding revenue from the delinquent (unremitted) and deferred (certified but not yet levied) special assessments receivable is deferred until the year in which it becomes available (collected within GO days of year-end), u n LJ n K. Inventories LJ The inventories of the General Fund and the Proprietary Funds are stated at cost on the first- in, first-ouI basis. The General Fund accounts for inventory using the consumption method. General Fund inventory consists of signs and miscellaneous other items. Proprietary Funds inventory consists of water meters, miscellaneous parts and other items. n u n LJ L. Deferred Revenue n Deferred revenue represents delinquent taxes, deferred and delinquent assessments, loans receivable and other unearned grants in all funds. This revenue is deferred until it is measurable and available as net current assets. u n LJ n LJ ....., ....J ....., '-.J ....., CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) ....J ....., LJ ...., NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) , L...> M, Compensated Absences ....., City employees earn vacation and sick pay accruing each payroll period. Unused vacation can be accrued by the employees up to a maximum of200 hours as of the anniversary date of the individual's employment with the City, In the governmental fund types, the liability for vacation pay is recognized in the General Fund to the extent it is expected to be paid from expendable available financial resources. The remaining liability is recorded in the General Long-Term Debt Account Group, Proprietary fund types expense vacation pay as it accrues, with the liability being recorded in the respective fund. ....J ....., c.J ..., L.J Employees can also accrue an unlimited amount of unused sick leave, Employees with two or more years of service are entitled to receive severance pay equal to a percentage of unused sick pay ranging from 20-50 percent based on years of service, up to a maximum of 400 hours. The liability for severance pay is accounted for the same as accrued vacation pay. ....., ....J N, Revenues. EXDenditures and EXDenses ....., ..J 1. Revenues ....., Property taxes are recognized as revenue when measurable and available. .....J Intergovernmental revenues are reported under the legal and contractual requirements of the individual programs. ....., '-.J Licenses and permits, charges for services, fines and forfeitures, and miscellaneous revenues, except investment earnings, are recorded as revenues when received in cash because they are generally not measurable until then. Investment earnings are recorded when earned because they are measurable and available. ....., LJ 2. Propertv Tax Collection Calendar ....., ;.,j The City levies its property tax for the subsequent year during the month ofDecernber and it is certified to Anoka County. The property tax is recorded as revenue when it becomes measurable and available. Anoka County is the collecting agency for the levy and remits the collections to the City three timcs a year. Taxes not collected as of December 3 I each year are shown as delinquent taxes receivable. ....., ;.,j ....., December 28 is the last day the City can certify a tax levy to the County Auditor for collection the following year. Such taxes become a lien on the following January I. L.J ....., L.J ....., LJ ..., ...J n u n u CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) n LJ n u NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) r--, N, Revenues. Expenditures and Expenses (Continued) u 2. Property Tax Collection Calendar (Continued) n LJ The County Auditor makes up the tax list for all taxable property in the City, applying the applicable tax rate to the tax capacity of individual properties, to arrive at the actual tax for each property, The County Auditor also collects all special assessments, except for certain prepayments paid directly to the City, n u The County Auditor turns over a list of taxes to be collected on each parcel of property to the County Treasurer in January of each year, The County Treasurer collects all taxes and is required to mail copies of all personal property tax statements by April 15, and copies of all real estate tax statements by April IS, of each year. n LJ n u n Property owners are required to pay one-half of their real estate taxes due by May 15 and the balance by October 15, u If taxes due May 15 are not paid on time, a penalty of3% is assessed on homesteaded property and 7% on non-homesteaded property. An additional 1 % penalty is added each month the taxes remain unpaid, until October 15, If the taxes due May 15 are not paid by October 15, a 2% penalty per month is added to homesteaded property and 4% per month to non-homesteaded property until January 1, n u n u If the taxes are not paid by January 1, further penalties are added. Penalties and interest apply to both taxes and special assessments, There are some exceptions to the above penalties, but they are not material. n u Within 30 days after the tax settlement date, the County Treasurer is required to pay 70% of the estimated collections of taxes and special assessments to the City Treasurer. The County Treasurer must pay the balance to the City Treasurer within 60 days after settlement, provided that after 45 days interest accrues at the rate of 8% per annum, n LJ n 3. Expenditures u Expenditure recognition for governmental fund types includes only amounts represented by current liabilities. Since noncurrent liabilities do not affect net current assets, they are not recognized as governmental fund expenditures or fund liabilities. They are reported as liabilities in the General Long-Term Debt Account Group. n u n u n LJ n LJ ..., -.J ...., c...J ..., CITY OF ANDOVER., MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) u ...., LJ ...., NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) LJ N, Revenues, Expenditures and Expenses (Continued) ...., 4, Exoenses ...J Proprietary fund types recognize expenses when they are incurred, ...., O. Interfund Trans'actions LJ .., LJ Quasi-external transactions are accounted for as revenues, expenditures or expenses, Transactions that constitute reimbursements to a fund for expenditures or expenses initially made from it that are properly applicable to another fund are recorded as expenditures or expenses in the reimbursing fund and as a reduction of expenditures or expenses in the fund that is reimbursed, ...., L.J All other interfund transactions, except quasi-external and reimbursements, are reported as transfers, Nonrecurring or nonroutine permanent transfers of equity are reported as residual equity transfers. All other interfund transfers are reported as operating transfers. ..., -.J P. Comparative Data ...., Comparative total data for the prior year have been presented in the accompanying financial statements in order to provide an understanding of changes in the City's financial position and operations, LJ ...., LJ Comparative data have been adjusted to reflect reclassifications of accounts for comparative purposes. ...., Q, Total Columns on General Pumose Statements LJ ...., Total columns on the general purpose financial statements are captioned "memorandum only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in cash flows in conformity with generally accepted accounting principles. Interfund eliminations have not been made in the aggregation of this data. L.l ...., L.l R. Reclassifications .., Certain] 997 amounts have been reclassified to confoml to the presentation used in the 1998 financial statements. Such recl::J.ssifications had no effect on net operating results or total fund equi ty as previously reported. -.J ...., ~ .., LJ .., LJ n LJ n LJ CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) n u n u NOTE 2 - STEWARDSHIP. COMPLIANCE AND ACCOUNTABILITY ~ u A, Fund Deficits n The following funds had deficit fund balances at December 31, 1998: u Debt Service Funds - G,O, Improvement Bonds of 1989 Capital Projects Funds - Storm Sewer Project Unfinanced Projects State Aid Revolving Projects $ 11,115 101,680 435,661 387,494 n LJ n LJ These deficits will be eliminated by transfers from other funds, collections of property tax levies or proceeds from bond issues. n LJ B. Expenditures in Excess of Aporooriations n Expenditures exceeded appropriations in the following funds for the year ended December 31,1998: LJ n Appropriations Expenditures .u Special Revenue Fund: Septic Disposal Fund Capital Equipment Reserve Oak Wilt Suppression $ 0 97,631 o $ 700 174,712 14,511 n LJ n NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS LJ A. Assets n L Cash and Investments (Including Cash Eauivalents) LJ Cash balances of the City's funds are combined (pooled) and invested to the extent available in various investments authorized by Minnesota Statutes, Each fund's portion of this pool (or pools) is displayed on the financial statements as "cash and investments (including cash equivalents)," For purposes of identifying risk of investing public funds, the balances and related restrictions are summarized below: r'! LJ n LJ a. Deposits - Minllesota Statllles require that all deposits with financial institutions must be collateralized in an amount equal 10 110% of deposits in excess of FDIC Il1surance. n LJ n LJ n LJ ...., -..J ...., ....J ...., CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) ....J ...., ....J ..., NOTE 3 - DETAiLED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) L.1 A. Assets (Continued) ...., 1. Cash and Investments (Including Cash Eouivalents) (Continued) a, Deposits - (Continued) Category 1 includes deposits covered by Federal Depository Insurance (FDIC) and those deposits collateralized with securities held by the City or by its agent in the City's name. ....J ..., ....J ...., ....J Category 2 3 Bank Balance Carrying Amount ...., Bank Accounts $ 153.400 $ 0 $ 0 $ 153.400 $ 378,896 ....J b, Investments - Minnesota Statutes authorize the City to invest in obligations of the U,S, Treasury, agencies and instrumentalities, shares of investment companies whose only investments are in the forementioned securities, obligations of the State of Minnesota or its municipalities, bankers' acceptances, future contracts, repurchase and reverse repurchase agreements, and commercial paper of the highest quality with a maturity of no longer than 270 days, Investments held by the City at year end classified as to credit risk are as follows: ...., ....J ...., ....J ...., Category 1 - Insured or registered, or securities held by the City's agent in the City's name. ..J ...., Category 2 - Uninsured and unregistered, with securities held by the counterparty's trust department or agent in the City's name. ....J ...., Category 3 - Uninsured and unregistered, with securities held by the counterparty, or by its trust department or agent but not in the City's name. L.1 ...., L.1 ...., LJ ...., LJ ...., ....J ...., ....J CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31,1998 (Continued) n ~ n LJ n LJ n LJ NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) A. Assets (Continued) 1. Cash and Investments (lncludinl! Cash Equivalents) (Continued) b. Investments - (Continued) Category 2 Negotiable CD's State and Local Government Securities U.S, Government Securities Commercial Paper $ 1,533,140 795,785 8,310,558 4,174,178 $ 0 o o o Total Investments $ 14.813.661 $ 0 $ 0 Minnesota Municipal Investment Pool Open End Mutual Fund Total Deposits (Note 3 A.La.) Petty Cash Total Cash and Investments (Including Cash Equivalents) Classified on the Balance Sheet as follows: Cash and Investments (Including Cash Equivalents) Accrued Interest Total n LJ n LJ 3 Fair Value and Canying Amount $ 1,533,140 795,785 8,310,558 4,174,178 14,813,661 1,411,072 329,226 378,896 650 n LJ n LJ $ 0 o n LJ o o n LJ n .LJ ,.., LJ n u n S 16.933,505 LJ n S 16,238,298 695,207 LJ S 16,933.505 n LJ During the year ended December 31, 1998, the City had investment revenue of S 1,090,124. n LJ n LJ ,..., L ..., .J ..., .J ..., CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) '-.J ...., ....J ...., NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) LJ A. Assets (Continued) ...., 2, Deferred Compensation Plan .....J ...., In accordance with the requirements of Governrnental Accounting Standards Board (GASB) Statement No. 32, the deferred compensation plan has been eliminated from the City's financial report. The assets and income of the plan are held in trust for the exclusive benefit of participants and their beneficiaries and are managed by trustees other than the City. The City has determined no further fiduciary relationship exists with the IRC Section 457 plan. 3. Flexible Benefit Plan .....J ...., .....J ...., The City offers a flexible benefit plan. The plan is a "cafeteria plan" under S 125 of the Internal Revenue Code, All employees who meet the eligibility requirements may participate in the plan, To be eligible, an employee must be regularly scheduled to work 30 hours per week. ..J ..., .....J Eligible employees can elect to participate by contributing pre-tax dollars withheld from payroll checks to the plan for health and dental care, dependent care, and other qualifying insurance benefits. Payments are made from the plan to participating employees upon submitting a request for reimbursement of eligible expenses actually incurred by the participant. .., .....J .., .....J All assets of the plan are held by the City. The plan is administered by the City for child care, out-of-pocket medical expense reimbursements and qualifying insurance premiums. ...., .., All plan property and income attributable to that property is solely the property of the City, subject to the claims of the City's general creditors. Participants' rights under the plan are equal to those of general creditors of the City in an amount equal to the eligible health care and dependent care expenses incurred by the participants. The City believes that it is unlikely that it will use the assets to satisfy the claims of general creditors in the future. L.J .....J .., ;J .., .J ...., L.J .., L.J .., .....J n LJ n u CITY OF ANDOVER. MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) n LJ n u NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) n LJ A, Assets (Continued) n 4, Fixed Assets u A summary of changes in the General Fixed Assets Account Group follows: n Balance Balance 1-1-98 Additions Disposals 12-31-98 Land $ 3,970,750 $ 0 $ 0 $ 3,970,750 Buildings and Improvements 2,926,451 189,294 (445) 3,115,300 Furniture and Equipment 745,265 159,245 (25,309) 879,201 Machinery and Equipment 3,799,998 67,910 (28,000) 3,839,908 Total General Fixed Assets $ 11.442.464 $ 416,449 $ (53.754) $ 11.805.159 LJ n LJ n LJ n LJ A summary of proprietary fund type fixed assets at December 31, 1998 is as follows: Water Sewer Total Furniture and Equipment $ 681,699 $ 168,111 S 849,810 Machinery 952,071 19,465 971,536 Collection and Distribution System 11,382,482 15,585,500 26,967,982 Accumulated Depreciation (2.510,603) (3,390,862) (5,901,465) Net Fixed Assets S 10,505,649 S 12.382.214 S 22.887.863 5. Loans Receivable n 'LJ n LJ n LJ n LJ As part of a development agreement entered into with a private developer in May, 1989, the City received a promissory note for S 243,520. The note is to reimburse the City for the fiscal disparities' contributions the City lost due to the establishment of a tax increment financing district for the development project. The note belrs an interest rate of 5.50% and calls for 180 equal monthly payments to be made to the City through August, 2003. At December 31, 1998, the remaining principal due of S 116,023 is offset by deferred revenue as it is not available to finance current activities. n LJ n LJ n LJ ,..., LJ n LJ --, --.J --, CITY OF ANDOVER, MINNESOTA -.J NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) --, ...J ,., NOTE 3 - DETAILED NOTES ON ALL FIDmS AND ACCOUNT GROUPS (Continued) --.J B. Liabilities ,., I. Defined Benefit Pension Plans - Statewide --.J a, Plan Descriotion --, ..., All full-time and certain part-time employees of the City of Andover are covered by defined benefit plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA administers the Public Employees Retirement Fund (pERF) and the Public Employees Police and Fire Fund (PEPFF) which are cost- sharing, multiple-employer retirement plans, These plans are established and administered in accordance with Minnesota Statutes, Chapters 353 and 356, --.J ....J ., ...J PERF members belong to either the Coordinated Plan or the Basic Plan, Coordinated Plan members are covered by Social Security and Basic Plan members are not. All new members must participate in the Coordinated Plan. All police officers, fire- fighters and peace officers who qualify for membership by statute are covered by the PEPFF. ..., --.J ..., PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of eligible members, Benefits are established by State Statute, and vest after three years of credited seIVice, The defined retirement benefits are based on a member's highest average salary for any five successive years of allowable seIVice, age, and years of credit at termination of service. ...J ..., --.J ..., Two methods are used to compute benefits for PERF's Coordinated and Basic Plan members. The retiring member receives the higher of a step-rate benefit accrual formula (Method I) or a level accrual formula (Method 2). Under Method I, the annuity accrual rate for a Basic Plan member who retired before July I, 1997 is 2 percent of average salary for each of the first 10 years of service and 2.5 percent for each remaining year. The annuity accrual rate for Basic members who retire on or after July 1,1997 is 2.2 percent of average salary for each of the first 10 years of seIVice and 2.7 percent for each remaining year, For a Coordinated Plan member who retired before July I, 1997, the annuity accrual rate is 1 percent of average salary for each of the first 10 years and 1.5 percent for each remaining year, For Coordinated members who retire on or after July I, 1997, the annuity accrual rates increase by 0,2 percent (to 1.2 percent of average salary for each of the first 10 years and 1.7 percent for each remaining year). Under Method 2, the annuity accrual rate is 2.5 percent of average salary for Basic Plan members and 1.5 percent for Coordinated Plan members who retired before July I, 1997. Annuity accrual rates increase 0.2 percent for members who retire on or after July 1, ] 997. For PEPFF members, the annuity accrual rate is 2.65 percent for each year of service for members retiring before July 1, 1997, Effective July I, 1997, the annuity accrual rate is increased to 3.0 percent. For all PEPFF members and for PERF members whose annuity is calculated using Method I, a full annuity is available when age plus years of service equal 90. A reduced retirement annuity is also available to eligible members seeking early retirement. -.J ..., ...J ..., --.J ., --.J ., ...J ..., --.J ..., L.J ..., L.J n u n LJ CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) n L.J r LJ NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) n B. Liabilities (Continued) 1. Defined Benefit Pension Plans - Statewide (Continued) LJ n LJ a. Plan Descriction (Continued) n There are different types of annuities available to members upon retirement. A normal annuity is a lifetime annuity that ceases upon the death of the retiree--no survivor annuity is payable. There are also various types of joint and survivor armuity options available which will reduce the monthly normal annuity amount, because the annuity is payable over joint lives. Members may also leave their contributions in the fund upon termination of public service in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who leave public service, but before retirement benefits begin, LJ n L.J n LJ The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service, n LJ n PERA issues a publicly available financial report that includes financial statements and required supplementary information for PERF and PEPFF, That report may be obtained by writing to PERA, 514 St. Peter Street #200, St. Paul, Minnesota, 55102 or by calling (651) 296-7460 or 1-800-652-9026. LJ n LJ b, Funding Policv n Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes, PERF Basic Plan members and Coordinated Plan members are required to contribute 8.75 percent and 4.75 percent, respectively, of their annual covered salary, PEPFF members are required to contribute 7.60 percent of their armual covered salary, The City of Andover is required to contribute the following percentages of annual covered payroll: 11.43 percent for Basic Plan PERF members, 5.18 percent for Coordinated Plan PERF members, and 11.40 percent for PEPFF members. The City's contributions to the Public Employees Retirement Fund for the years ended December 30,1998,1997, and 1996 were S 89,513, S 67,050, and S 58,310, respectively, The City's contributions to the Public Employees Police and Fire Fund for the years ended December 31, 1998, 1997, and 1996 were S 5,950, S 5,453, and S 5,052, respectively. The City's contributions were equal to the contractually required contributions for each year as set by state statute. LJ n LJ n LJ n LJ n LJ n LJ n LJ ...., ....J ..., ...J ...., CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) ....J ...., ....J ..., NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) L.J B, Liabilities (Continued) ...., 2. Defined Contribution Lump Sum Service Pension Plan - Volunteer Firefighters Relief Association ...J ..., a, Plan Description ...J Members of the City's volunteer fire department are members of the Andover Fire Fighters' Relief Association. The Association is a single-employer defined contribution plan that was established in 1979 and operates under the provisions of Minnesota Statutes 9 69 and 424A, as amended, It is governed by a Board consisting of six officers and trustees elected by the members of the Association for three-year terms, The City Mayor, City Clerk, and Fire Chief are ex-officio members of the Board of Trustees. The payroll for City employees who are members of the Association for the year ended December 31, 1998 was $ 101,323, The City's total payroll was $ 1,788,301. ...., ...J ...,. ...J ...., .J For [mancial reporting purposes, the Association's financial statements are not included in the City of Andover's financial statements because the Association is not a component unit of the City. ...., ....J b, Pension Benefits ...., Minnesota Statutes Chapters 424 and 424A authorize pension benefits for volunteer fire relief associations. A firefighter who completes at least 20 years as an active member of the municipal fire department to which the Association is associated, and has been a member of the Relief Association for at least 10 years prior to retirement after age 50, is entitled to a service pension upon retirement. ...J ...., L.J ..., The service pension prescribed by the Association's bylaws is a lump sum settlement equal to the amount in the individual member's account at the time of retirement. The individual member accounts are credited with an equal share of: any fire state-aid received by the Association, any municipal contributions to the Association, and any other assets of the Association's Special Pension Fund. L.J ..., LJ The bylaws of the Association also provide for a reduced service pension for a retiring member who has complcted fewer than 20 years of service. The reduced pension, available to members with 10 years of service, shall be equal to 60% of the pension as prescribed by the bylaws. This percentage increases 4% per year so that "-t 20 years of service, the full amount prescribed is paid. ...., ....J ...., ....J ...., ....J ...., ....J n u n LJ CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) n LJ n u NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) n u B, Liabilities (Continued) 2. Defined Contribution Lump Sum Service Pension Plan - Volunteer Firefighters Relief Association (Continued) n LJ b. Pension Benefits (Continued) n LJ A member of the Association who has completed 20 or more years of active service with the fire department prior to reaching age 50, has the right to retire from the department without forfeiting the right to a service pension. The member shall be placed on the deferred pension roll. Upon reaching age 50, the member may apply for the standard service pension as described above. The Association shall pay interest on the deferred service pension during the period of deferral. The interest rate will be compounded annually, at the rate actually earned on the assets of the Special Pension Fund, not to exceed 5% per year. n u ,...., u ,...., An active member of the Association who becomes disabled to the extent that a physician shall certify that such disability will permanently prevent the member from performing his duties in the Andover Fire Department, is entitled to a disability pension equal to the balance in the member's account after 100 days of disability, If a member who has received such a disability pension should subsequently recover and return to active duty in the Andover Fire Department, any amount paid to him as a disability pension shall be deducted from his service pension accrued at the time of such disability, LJ n 'LJ ,...., LJ Upon the death of any member of the Association who is in 'good standing at the time of death, the Association shall pay the member's spouse, children, or estate the balance of the member's account at the date of payment. n LJ The City of Andover has the power to levy property taxes at the direction and for the benefit of the Association, and passes through state aids allocated to the plan, in accordance with enabling state statutes, n LJ .'!"....-. ." - n c. Contributions Reauired and Contributions Made LJ The City's contributions under the plan, detemlined by the Association's Board of Trustees and ratified by the City Council in accordance with enabling state statutes is S 750 per member per year. r L r L r L r L CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) ..., .....J ..., -..J ..., ...J .....J NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) ..., B. Liabilities (Continued) 2, Defined Contribution Lump Sum Service Pension Plan - Volunteer Firefighters Relief Association (Continued) o ..., c, Contributions Required and Contributions Made (Continued) -..J ..., In 1998, the City contributed $ 91,580 to the Association, consisting of $ 57,830 state aid and $ 33,750 fulfilling the City's $ 750 per member contribution obligation for the year ended December 31, 1998. The City's contribution represents 37,7% of covered payroll. ....J ..., 3. Deferred Revenues ....J Deferred revenues at December 31, 1998 are summarized below: ..., ....J General ..., Taxes Receivable - Delinquent $ 76,608 Special Assessments Receivable - Deferred 46 Delinquent 257 Loans Receivable 0 Deposits and Other 0 ....J ..., .....J ..., .....J Total S 76,91 I ..., 4. Long-Term Debt L.J Special Revenue S 557 o o o 186,135 S 186,692 Debt Service $ 74,55 I 5,938,798 10,162 o o S 6,023,511 Capital Projects $ 0 2,376,610 59,480 133,008 o S 2,569,098 Enterprise S S Total o $ 151,716 o o o 534 8,315,454 69,899 133,008 186.669 534 S 8,856,746 ..., The following is a summary oflong-term debt transactions of the City for the year ended December 31,1998: L.J ..., L.J Gcneral Obligation Bonds Gencral Obligation Rcvenue Bonds Spccial Asscssmcnl Bonds Tax InCrCl1lCIll Bonds Ccnificates oi Indebtcdness Asscssmcllls on City Property Compensated Abscnccs I'Jyablc ..., L.J ..., L.J ..., L.J ..., ....J Balance January 1, 1998 S 1,000,000 2,350,000 18,510,000 8,S30,000 485,000 145,051 156,468 S 31,476,519 Additions S 760,000 o o o o o 22,806 S i82.S06 Deletions S 1,000,000 35.000 3,085,000 335,000 130,000 26,456 o S 4,611,456 Balance December 31, 1998 S S 760,000 2,315,000 15,425,000 S,495,000 355,000 118,595 1 i9,274 27.647,S69 CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) B. Liabilities (Continued) 4, Long-Term Debt (Continued) Bonds payable at December 31, 1998 are comprised of the following issues: Marurity Interest Rate Issue Date Date General Obligation Bonds: G.O, Refunding Bonds of 1998 3.60-3.75% 12-01-98 07-01-01 General Obligation Bonds: Public Project Revenue Bonds of 1997 4.50-5.90% 09-01-97 12.01-16 Special Assessment Bonds: G,O. Improvement Bonds of Series 1977 A G.O, Improvement Bonds of Series 1993A G.O, Improvement Bonds of Series 1994C G.O, Improvement Bonds of 1995A Refunding Bonds of Series I995B G.O. Crossover Refunding Bond ofl996 G.O. Improvement Bonds of 1996 G.O. Improvement Bonds of Series 1997 A G.O. Refunding Bonds of 1997 G.O. Improvement Bonds of Series 1997B Total Special Assessment Bonds On gina 1 Issue Retired s 760,000 S 2,350,000 35,000 5,00% 02-01-77 01-01-06 1,215,000 750,000 4.00-4.75% 08-01-93 08.01-03 3,650,000 1,825,000 5.05-5,75% 10-01-94 02.01-06 1,140,000 225,000 4.85-5.30% 07-01-95 02-01-06 2,605,000 420,000 4.65-4.85% 07-01-95 08-01-00 825,000 550,000 4.15-4.50% 06-01-96 08-01-01 1,220,000 310,000 4.15-5.00% 06-01-96 08-01-06 600,000 105,000 4.20-4.80% 05-01-97 12-01-02 3,120,000 650,000 4.20-4.50% 06-01-97 08-01-00 630,000 210,000 3.90-4.70% 07-01-97 12-01-05 6,315,000 850,000 21,320,000 5,895,000 o $ n u n LJ n LJ n LJ n LJ ,..., LJ ,..., Outstanding LJ 760,000 n LJ n 2,3 I 5,000 LJ n 465,000 LJ 1,825,000 n 'LJ 915,000 n 2,185,000 LJ 275,000 n 910.000 LJ 495.000 n 2,470.000 LJ 420.000 n 5,465.000 LJ 15.425.000 n LJ n LJ n LJ n LJ ...., -..J ...., ...J ...., -..J ...., .J ...., c..J .., -..J ...., .J ...., -..J ...., c..J ...., ...J ...., -..J ...., .J ...., -..J .., .J ...., .J ...., -..J ..., .J ...., ...J ...., -..J CITY OF ANDOVER, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) B, Liabilities (Continued) 4, Long-Term Debt (Continued) Marurity Interest Rate Issue Date Date Original Issue Tax Increment Bonds: G.O. Tax Increment Bonds of Series 1993B G.O, Tax Increment Refunding Bonds of Series 1994B G.O. Tax Increment Bonds of Scries 19950 G.O. Tax Increment Bonds of 1996 Total Tax Increment Bonds Certificates of Indebtedness: I994A Certificate of Indebtedness 1995C Certificate of Indebtedness Total Certificates of Indebtedness Assessments on City Property Compensated Absences Payable TOTAL Y car Ending Deccmbcr 3 I Gcncral Obligation Bonds 4.00-5.00% 08-01-93 08-01-03 $ 520,000 $ 6.97-7.87% 05-01-94 05-01-04 885,000 4.50-5.60% 10-01-95 02-01-13 6,055,000 4,75-5.40% 06-01-96 08-01-12 2,055,000 9,515,000 4,05% 03-01-94 4.65-4.85% 06-01-95 03-0 I -99 02-01-00 150,000 515,000 665,000 6.25-10.70% NtA 2001 338,174 NtA N/A NtA 179,274 S 35,127,448 S 7.479,579 S 27,6.17.%9 Special Assessment Bonds Tax Increment Bonds Ccrtificates of Indebtedness Retired Outstanding 250,000 $ 270,000 360,000 525,000 305,000 5,750,000 105,000 1,950,000 1,020,000 120,000 190,000 3 I 0,000 219,579 8,495,000 30,000 325,000 355.000 118,595 o 179.274 Total 1999 S 271,325 S 170,025 S 3,645,348 S 797,165 2000 283,805 173,165 3,446,393 817,880 2001 249,000 181,005 2,997,563 826,495 2002 0 183,310 2,590,719 838,458 2003 0 190,310 1,898,865 824,047 Thercafler 0 3,031,935 3.366,483 8,251.386 ~ 80.1.130 S 3.929,750 17.945.371 12,355,431 192,687 S 5,076,550 179,244 4,900,487 0 4.254.063 0 3.(>1 2.487 0 2.~) 13.222 0 14.r).l9.S0~ - 371.931 S 35.406.613 The annual requirements to amortize all bonded debt outstanding as of December 31, 1998 including interest payments of S 8,056,613 are: General Obligation Revenue Bonds s s n u n LJ CITY OF ANDOVER NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) n LJ n LJ NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) ..., B, Liabilities (Continued) L) 5, Refunding Bonds ..., On December 3, 1998, the City issued $ 760,000 General Obligation Refunding Bonds with an average interest rate of3.71 % to advance refund $ 750,000 of outstanding 1991A General Obligation Bonds with an average interest rate of 6.44%. The net proceeds of $ 749,591 plus an additional $ 564 of City funds were used to call and retire all outstanding 1991A Bonds on December 31, 1998 and to pay bond issuance expenses. This current refunding will result in a total reduction in debt service payments of $ 18,630 over the next three years and provides for an economic gain of $ 17,220. LJ ..., LJ ..., LJ 6, Conduit Debt Obligations ..., Conduit debt obligations are certain limited-obligation revenue bonds or similar debt instruments issued for the express purpose of providing capital financing for a specific third party, The City has issued various revenue bonds to provide funding to private- sector entities for projects deemed to be in the public interest. Although these bonds bear the name of the City, the City has no obligation for such debt beyond the resources provided by related leases or loans. Accordingly, the bonds are not reported as liabilities in the financial statements of the City. L1 ..., LJ n 'LJ As of December 31, 1998, the following revenue bonds were outstanding: ..., Date of Original Proiect Issue Issue Retired Downtown Center 07-15-97 $ 5,645,000 $ 355,000 Downtown Center 07-15-97 1,250,000 75,000 Presbyterian Homes of Andover, Inc, 12-01-98 13,980,000 0 Presbyterian Homes of i\ndover, Inc, 12-01-98 720,000 0 Total S 21.595,000 S 430,000 Outstanding December 31. 1998 LJ n s 5,290,000 1,175,000 13,980,000 720,000 LJ ,.., LJ n S 21.165.000 LJ n LJ ..., L1 ,., u ,...., LJ ...., .j ...., ...J ...., CITY OF ANDOVER NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31,1998 (Continued) ..J ...., ...J NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) ...., ...J C. Fund Eouitv ...., Fund equity balances are classified as follows to reflect the limitations and restrictions of the respective funds: ..J 1. Investment in General Fixed Assets ...., ...J Represents the City's equity in general fixed assets, ...., 2. Contributed Capital ...., Contributed capital in the enterprise funds represents fixed assets which were purchased by other funds and transferred to the enterprise funds. Change in contributed capital for the year ended December 31, 1998 is as follows: ...J .....J ...., Add: 1998 Contributions Less: Depreciation on Contributed Assets Enterprise Funds Water Sewer Fund Fund Total $ 9,124,401 $ 10,896,581 S 20,020,982 1,520,738 1,688,206 3,208,944 (197,235) (277,946) (475,181) S 10.j47.904 $ 12.306.841 $ 22.754.7<15 ...., ...., Contributed Capital - January 1, 1998 ...J ...J ...J ...., Contributed Capital - December 31, 1998 ...J ...., ~J ...., ...J ...., .....J ...., ...J ...., w ...., .....J n LJ n u CITY OF ANDOVER n NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31,1998 (Continued) LJ n LJ NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued) n C, Fund Eauitv (Continued) 3, Fund Balance u n Fund balances are classified as follows to reflect limitations and restrictions of the respective funds. Reserved for: Inventory Prepaid Iterrts Debt Service Total Reserved Fund Balance Unreserved: Designated for Working Capital Designated for Furure Expendirures Designated for Projects Designated for Equipment Designated for Administration Total Unreserved _ Designated Fund Ba lance Undesignared Total Fund Balance u n Special Debt Capital Expendable General Revenue Service Projects Trust Total $ 60,349 $ 0 $ 0 $ 0 $ 0 $ 60,349 8,854 0 0 0 0 8,854 0 0 7,770,700 0 0 7,770,700 69.203 0 7,770,700 0 0 7,839,903 LJ n LJ n LJ n u 2,196.484 0 0 0 0 2,1%,484 0 0 0 0 0 0 0 0 0 3.261,168 0 3,261,168 0 0 0 117,240 0 117,240 0 0 0 0 0 0 n 'LJ n u n 2,1%,484 o 5,574.S92 u o 3,378,408 o 182,736 1,661,433 n (11,115) (924,835) o 908,2 J 9 u $ 2,448,423 S 1,661.433 S 7,759,585 S 2,453,573 S 14.323.014. n s o u 4. Retaincd Earnin!!s Rctaincd earnings balances are unrcservcd at December 3 1. 1998. n LJ n u n u ,.., Ll , ....J ..., _J ..., CITY OF ANDOVER NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) ~ ..., ~ NOTE 4 - SEGMENT INFORMATION ..., ~ The City maintains Water and Sewer Enterprise Funds. Segment infOlmation for the year ended December 31, 1998 is as follows: , Sewer Water -.J ..., Operating Revenues Operating Expenses Depreciation Expense Operating Income (Loss) Operating Transfers, Net Net Loss Contributed Capital Net Working Capital Fixed Asset Purchases Total Assets Total Equity $ 928,581 742,153 312,101 186,428 (321,000) (52,353) 10,447,904 1,272,626 80,738 11,796,047 11,766,085 $ 928,130 1,035,757 305,688 (107,627) (45,218) (95,767) 12,306,841 999,698 39,763 13,385,868 13,372,090 -.J ..., ...J ..., -.J ..., .....J NOTE 5 - TAX.. INCREMENT DISTRICTS ..., Total $ 1,856,711 1,777,910 617,789 78,801 (366,218) (148,120) 22,754,745 2,272,324 120,501 25,181,915 25,138,175 ...J The City of Andover is the administering authority for the following tax increment finance districts: ..., 1, Name of District: Andover Redevelopment District 1-1 Type of District: Redevelopment Authorizing Law: MilllleSOla SlaLUles Section 472 Established: 1986 Duration of District: Through 2012 Original Net Tax Capacity Current Net Tax Capacity Captured Net Tax Capacity - Retained by City .....J ..., ...J ..., ...J ..., 2. Name of District: Andover Redevelopment District 1-2 Type of District: Redevelopment Authorizing Law: MilllleSOla Sla/llleS Section 472 Established: 1986 Duration of District: Through 2012 Original Net Tax Capacity CUlTent Net Tax Capacity Captured Net Tax Capacity - Retained by City .....J ..., ~J ..., ...J ..., ..J -, ...J S 28,525 296.874 S 268.349 S G I ,01 8 G I 6,607 S 555.589 n LJ n CITY OF ANDOVER NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) u n LJ n NOTE 5 - TAX INCREMENT DISTRICTS (Continued) u Total District I Bonds Issued n Amounts Redeemed $ 9,515,000 0,020,000) $ 8.495,000 LJ n Bonds Outstanding at December 31, 1998 LJ NOTE 6 - RISK MANAGEMENT n LJ The City is exposed to various risks ofIoss related to torts; theft of, damage to, and destruction of assets; errors and omissions; and natural disasters. The City participates in the League of Minnesota Cities Insurance Trust (LMC Trust), a public entity risk pool for its general property and casualty, workers' compensation, and other miscellaneous insurance coverages, The LMC Trust operates as a common risk management and insurance program for approximately 780 cities, The City pays an annual premium to the LMC Trust for insurance coverage. The LMC Trust agreement provides that the Trust will be self-sustaining through member premiums and will reinsure through commercial companies for claims in excess of certain limits. The major reinsurance points are generally $ 200,000 per occurrence for property loss or damage and $ 450,000 per occurrence for workers' compensation, n LJ n u n LJ The City also carries commercial insurance for certain other risks ofIoss, including employee health insurance, Settled claims resulting from these risk have not exceeded commercial insurance coverage in any of the past fiscal years. n LJ n NOTE 7 - COMMITMENTS LJ The City has several commitments outstanding at year end for various construction projects. They are summarized below: n u Expended Required Project Through Remaining Further Project Authorization 12-31-98 Commitment Financing Commercial Boulevard Ex!. I S 167,452 S 145,904 S 21,548 None Commercial Boulevard Ex!. 2 177,195 176,008 1,187 None Public Works Expansion 316,717 220,869 95,848 None Andover Commercial Park 750,271 342.691 407,580 None Well #6 Well House Design 397,600 373,6 I 6 23,984 None Jay Street NW 357,640 306,988 50,652 None Shadow Brook 4th Addition 293,855 223,892 69,963 None ,..., LJ ,..., LJ ,..., LJ ,..., LJ n LJ ,..., LJ J ., j -., J -, -.J .., -.J .., ...J ..., ...J .., -.J ..., ...J .., ...J ..., ...J ..., ...J .., ...J .., ...J ..., ..J --., _J .., .J CITY OF ANDOVER NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 1998 (Continued) NOTE 7 - COMMITMENTS (Continued) The Federal and State program activities are subject to financial and compliance regulation. To the extent that any expenditures are disallowed, a liability to the respective Federal or State Agency could result. The City expects such amounts, if any, to be immaterial. NOTE 8 - YEAR 2000 ISSUE The City of Andover has completed an inventory of computer systems and other electronic equipment that may be affected by the year 2000 issue and that are necessary to conducting City operations. Based on this inventory, the City is in the remediation stage for the financial reporting systems and other necessary systems; the City has contracted with its computer operations providers for necessary upgrades, Testing and validation of the systems will need to be completed prior to January 1,2000. . Guidelines established by the League of Minnesota Cities are implemented to address potential problems. A year 2000 taskforce has been formed to address concerns. Because of the unprecedented nature of the year 2000 issue, its effects and the success ofrelated remediation efforts will not be fully determinable until the year 2000 and thereafter. Management cannot assure that the City is or will be year 2000 ready, that the City's remediation efforts will be successful in whole or in part, or that parties with whom the City does business with will be year 2000 ready, CITY OF ANDOVER REQUEST FOR COUNCIL ACTION DA TE Seotember 21. 1999 AGENDA SECTION Approval of Claims ORIGINATING DEPARTMENT Finance ~\"""" Jean D, McGann I ITEM NO. Schedule of Bills REOUEST: The Andover City Council is requested to approve total claims in the amount of$ 500.192.86. BACKGROUND: Claims totaling $ 65.079.53 on disbursement edit list #1 dated 09-14-99 have been issued and released. Claims totaling $435.113.33 on disbursement edit list #3 dated 09-21-99 will be issued and released upon Council approval. Date: 09-21-99 Approved By: , '" '" . . . . . . 0", C 3:3:0'00' " . . . ~'" Co' I I , . , ~ '" '0 . . '0 0 00000 2 0 . . .... "zt;' \D\D\D\D\D ~ . . ......, ~I-'I-'I-''''' , " . . ,.... . CJ\U'loIroolro"" Co " . . ...." 0",,, 1-'1-'1-'1-'.... 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