$2.4 million bond sale planned
By Seth Schmidt
The City of Tracy is pursuing a $2,430,000 sale of general obligation bonds to finance street and utility improvements on Morgan and Fourth streets.
Bond consultant Todd Hagen told the Tracy City Council Monday that he hopes the 15-year bond will attract an average interest rate of about 2.75%. Sale of the bonds is projected for the second week in November.
The construction, which has an August of 2015 completion target, calls for the reconstruction of Morgan between Sixth and Second streets, with new underground sewer and water lines, new curb and sidewalk, and a new bituminous surface. Fourth St. will be rebuilt, with new underground utilities, curbs and sidewalks, between South and Harvey streets. The remainder of Fourth St. between Hwy. 14 and Pine St. will receive a mill and bituminous overlay.
A $2,664,079 construction bid from Duininck Construction, Prinsburg, was accepted for the project in September.
Lyon County has budgeted $600,000 towards the Fourth St. project because of its County State Aid Highway status. Work is expected to begin next spring.
Property assessments, city property taxes, and water and sewer revenues will be used to repay the money borrowed from the city-backed bond sale.
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In addition to authorizing the bond sale process, the council also adopted two recommendations from their bond consultant. A “state credit enhancement” through the Minnesota Public Facilities Authority will be sought. The council also passed a motion asking that Ehlers, their bond consultant company, prepare an arbitrage policy to consider at their next meeting. Both actions will require fees of $500. Hagen felt that the potential for obtaining a lower interest rate made both actions worthwhile.
The council granted authority to a committee made up of Mayor Tony Peterson, Administrator Mike Votca, and Hagen to act on the city’s behalf in selecting the best bond bid on Nov. 12.