HomeMy WebLinkAbout1998-08-05 PACKET 04.N.REQUEST OF CITY COUNCIL ACTION COUNCiI AGENDA
MEETING ITEM °#�
DATE 8/5/98 � . /v .
�F2EPARED BY Administrztion Ryan Schroeder
ORIGINATING DEPARTMENT STAFF AUTHOR
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COUNCIL ACTION REQUEST
Establish administrative fees for tax-exempt bonds policy.
BUDGET IMPLICATION $ $
BUDGETED AMOUNT ACTUAL AMOUNT FUNDING SOURCE
SUPPORTING DOCUMENTS
❑ MEMO/LETTER:
❑ RESOLUTION:
❑ ORDINANCE:
❑ ENGINEERING RECOMMENDATION:
❑ �EGAL RECOMMENDATION:
� OTNER:
ADMINISTRATORS COMMENT�
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Date
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COUNCIL ACTION TAKEN: ❑ APPROVED ❑ DENIED ❑ OTHER
ADMINISTRATIVE FEES FOR TAX-EXEMPT BONDS POLICY
Purpose
The City of Cottage Grove has the authority to issue tax-exempt revenue bonds on
behalf of certain types of development. This enables the development to secure
favorable financing, and promotes commercial and industrial development. The City
does incur some cost in issuing these bonds, in terms of staff time and legal expenses
in reviewing the proposal. This cost should not be born by the generai taxpayers of the
City. An administrative fee shall be charged to the development requesting the tax-
exempt revenue bonds to cover these costs. The fee shall be on a siiding scale to
address the potential cost to the issuer in very large bond requests.
Policy
In consideration of the City of Cottage Grove making tax-exempt revenue bond
financing available for private development, and to assist the City in defraying its
present and future administrative expenses, the appiicant shail, subject to appiicable
federal arbitrage regulations, pay to the City of Cottage Grove an administrative fee of
one-percent (1 %) of the first $10 miliion in requested financing, with a one-half of one
percent (1/2%) fee being charged on the remaining issue. No annual administrative fee
shall be cnarged.
The City Council shall review these fees from time to time and may adjust the fees by
resolution.
City Administrator