HomeMy WebLinkAboutItem 6I:\CC Drafts\Work Session\PARK FINANCING MEMO.docx
City of Lakeville
Parks & Recreation
Memorandum
To: Mayor and City Council
Justin Miller, City Administrator
From: Jerilyn Erickson, Finance Director
John Hennen, Parks and Recreation Director
Date: October 20, 2017
Subject: Community Park Financing Strategy
BACKGROUND
As previously discussed at Work Session meetings regarding the Capital Improvement Plan (CIP), the
funding mechanisms for three major park projects were proposed to be financed with bond proceeds.
The three major park projects proposed to be constructed over the next 10 years include the
following:
1) Antlers Park Expansion and Upgrades - $4 ,800,000
2) East Community Park Expansion - $3,350,000
3) Avonlea Community Park - $8,105,000
Currently, East Community Park has a neighborhood park serving the residents in the area and the
timeline for the development of the Avonlea Community Park is still up in the air.
Besides these three parks, there has been the establishment of an Indoor Athletic Facility Task Force
that has been discussing the construction of a dome facility in our community that currently is not
programmed in the CIP. This project has the potential to be a partnership with ISD 194 and various
athletic associations.
FINANCING OPTIONS
Staff has reached out to Dorsey and Whitney, LLP, the City’s bond counsel, regarding the City’s options
for issuing bonds to finance recreational facilities in our community. As noted and explained in the
attached memo from Jennifer Hansen, there are five primary options for financing recreational
facilities which are:
• General obligation (voted) recreational facilities bonds
• Gross revenue bonds
• General obligation tax abatement bonds
• Lease revenue bonds
• Bonds issued pursuant to special legislation
I:\CC Drafts\Work Session\PARK FINANCING MEMO.docx
Options for financing these projects through bond proceeds could include:
1) Bond for each project individually, or
2) Pair them up and bond them together as a package i.e. Antlers Park/Dome and East
Community/Avonlea Community Park.
IMPACT ON DEBT
Assuming 4% interest rate and 15- year term, the annual payment on $1 million would be
approximately $90,000.
DIRECTION
At this time, staff is seeking direction on the financing strategy for the three major park projects along
with the possibility of financing the construction of a dome.