HomeMy WebLinkAboutPacket - 05/20/2002 - City Council
A G E N D A
REGULAR CITY COUNCIL MEETING
Monday, May 20, 2002 7:30 P.M.
1. Call to Order
2. Roll Call
3. Pledge of Allegiance
4. Public Hearing: Chroma Corporation Industrial Revenue Bond Refunding
5. Public Input Session – 10 Minute Limitation
6. Consent Agenda:
Semi-Annual Interest Payment, $117,525;
- Special Service Area No. 1A - $11,275 to Home State Bank;
- Series 2000A Alternate GO Bonds - $79,800 due to Bank One;
- Series 2000B Alternate GO Bonds - $26,450 due to Bank One;
Ordinance granting Conditional Use Permit to Adams Outdoor Power Equipment,
3107 W. Route 120;
List of Bills.
7. Request from the Carson & Barnes Circus and the Wonder Lake Chamber of Commerce for the use
of Petersen Park and waiver of all associated fees
8. Request for Annexation, Rezoning, and Variances for 1625 N. Riverside Drive, 1810 N. Riverside
Drive, and 1811 N. Riverside Drive
9. Award of Bid to Robert W. Baird for Series 2002 Alternate General Obligation Bonds for Edgebrook
Drainage Project and North Interceptor Sewer Project and Approval of the Bond Ordinance in the
amount of $3,900,000.00
10. Recommendation to enter into contract with Smith Engineering Consultants, Inc. not to exceed
$16,945 for Project Engineering of the Main Street Sanitary Sewer and Water Main Replacement
Project
11. Award 2002 Street Program to Payne and Dolan, Inc.
12. Discussion: Meyer Material Expansion, North Side of State Route 120
13. Mayor – Statement and Reports
14. Committee Reports
15. Department Head Reports
16. New Business
17. Adjournment
Posted and Mailed: May 15, 2002
C O N S E N T A G E N D A
The Consent Agenda for the May 20, 2002 City Council meeting consists of the
following items:
Semi-Annual Interest Payment, $117,525;
- Special Service Area No. 1A - $11,275 to Home State Bank;
- Series 2000A Alternate GO Bonds - $79,800 due to Bank One;
- Series 2000B Alternate GO Bonds - $26,450 due to Bank One;
Ordinance granting Conditional Use Permit to Adams Outdoor Power Equipment, 3107 W.
Route 120;
List of Bills.
Attachments
PUBLIC HEARING
TO: Mayor and City Council
FROM: John A. Lobaito, City Administrator
FOR: May 20, 2002 Regular City Council Meeting
RE: Refunding of the 1994, 1994B and 1996 Series Industrial Revenue
Bonds, Chroma Corporation.
Recommendation: To conduct a Public Hearing
City Attorney David McArdle was notified of a request from Chroma Corporation,
1260 Belden Street, McHenry, to issue Industrial Revenue Bonds in an amount not to
exceed $3,700,000. This is a refunding issue of the Industrial Revenue Bonds from
1994 and 1996. Chroma Corporation is refunding these bonds at this time to lower
interest cost and to realize savings on their debt service.
Attached you will find a letter from City Attorney McArdle and the borrower’s bond
counsel further explaining the request. On June 3, 2002 the bond ordinance will be
brought to the City Council for consideration.
Chroma Corporation President Jay Ward will be present to answer any questions the
City Council may have regarding this matter.
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Attach.
CONSENT AGENDA
TO: Mayor and City Council
FROM: John A. Lobaito, City Administrator
FOR: May 20, 2002 Regular City Council Meeting
RE: Semi-Annual Debt Service Interest Payment
Interest payments are due on June 1, 2002 for the following bonds issued by the city
of McHenry:
Special Service Area No. 1A - $11,275 to Home State Bank
Series 2000A Alternate GO Bonds - $79,800 to Bank One
Series 2000B Alternate GO Bonds - $26,450 to Bank One
The bonds issued for Special Service Area No. 1A were for the installation of a traffic
signal and traffic control improvements at the intersection of Route 31 and Shamrock
Lane.
The Series 2000A bonds were issued to finance the five-year street improvements
program. The Series 2000B bonds were refunding bonds issued to take advantage of
favorable interest rates through the refinancing of 1990 GO bonds originally issued to
construct the Municipal Center.
Payments for the above-mentioned bonds were scheduled to comply with the
contractual commitments in the bond agreements previously approved by the City
Council.
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Attach.
MEMORANDUM
To: Mayor and City Council
From: John A. Lobaito, City Administrator
Date: January 7, 2022
Via: Hand-Delivery
Subject: May 20, 2002 Agenda Supplement
Meyer Material Expansion
The agenda supplement for the above-mentioned matter was sent to the City Council in
last week’s Friday Packet. Please include this supplement in your May 20, 2002 City
Council Agenda Packet.
If you need another packet, please telephone my office and Marci will arrange for a
supplement to be delivered to your home.
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MEMORANDUM
To: Mayor and City Council
From: John A. Lobaito, City Administrator
Date: January 7, 2022
Via: Hand-Delivery
Subject: May 20, 2002 Agenda Item 11,
Award of 2002 Street Program to Payne and Dolan.
The agenda supplement for the above-mentioned matter will be delivered to the City
Council in the May 17, 2002 Friday Packets.
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AGENDA SUPPLEMENT
TO: Mayor and City Council
FROM: John A. Lobaito, City Administrator
FOR: May 20, 2002 Regular City Council Meeting
RE: Bond Ordinance for Edgebrook Drainge Project and North Interceptor Sewer
Project
Recommendation: It is recommended that the City Council authorize the Mayor’s execution
of the attached Bond Ordinance providing for the issuance of $3,900,000 Alternative General
Obligation Bonds subject to the City Attorney’s review and approval.
Over the past year, the city has initiated the Edgebrook Drainage and North Interceptor
Sewer projects. These projects are to be financed through the issuance of bonds. In October
2001, the City Council approved the authorizing ordinance for the issuance of Alternate
General Obligation Bonds to pay for these projects and the intersection improvements at
McCullom Lake and Route 31. Because of the city’s success in obtaining grant funds for the
intersection improvements, the City Council approved a delay to issue bonds for this
improvement project until a decision is made on the city’s Congestion Mitigation & Air
Quality (CMAQ) grant application (notification is expected in August 2002).
Monday, May 13, 2002, the city accepted bids for the purchase of $3,900,000 in Alternate
General Obligation Bonds (Series 2002), which is part of the bonds authorized by the City
Council last October.
Approximately 85 prospective purchasers and underwriters were notified of the bond sale.
Nine bids were received. Attached is a listing of the bidders and their bid amount. Harold
Warren of Warren and Associates is recommending that the city accept the bid from Robert
W. Baird Company, Inc. The net interest cost percentage of the recommended bid is
$4,2952% over the turn of the bond issue.
As discussed by the City Council, a level debt payment schedule was used over a 14-year
period. By utilizing a level payment schedule over the term of the bond issue, the city will
have greater financial flexibility to address future capital projects.
Also included for the review and consideration of the City Council is a bond ordinance
prepared
by the city’s bond counsel, Chapman and Cutler.
2002 Series Bonds
$3.9-Million Alternative General Obligation Bonds
Net Interest
Financial Institution Cost Percentage
1. Robert W. Baird Co., Inc. 4.2952%
2. Harris Bank 4.329%
3. Griffin, Kubik, Stephens Thompson, Inc. 4.3781%
4. Stone & Youngberg LLC 4.3817%
5. Bank One Capital 4.3973%
6. Stephens 4.404292%
7. RBC Dain Rauscher, Inc. 4.4065%
8. Solomon, Smith Barney, Inc. 4.360557%
9. Bernardi Securities, Inc. 4.4278%
AGENDA SUPPLEMENT
TO: Mayor and City Council
FROM: John A. Lobaito, City Administrator
FOR: May 20, 2002 Regular City Council Meeting
RE: Year 2002 Street Program
At the May 6, 2002 City Council meeting, approval of the Award of Bid to Payne and Dolan,
Inc. was postponed pending an evaluation of the available funds.
Over the past several weeks, it has become apparent that the remaining balance in the Street
Improvements Fund is not adequate to fully fund the $1.8-million final year of the program as
proposed by the Public Works Department.
Original Financing Plan Assumptions
Originally, the city considered issuing bonds for a five-year street improvements program
costing between $4.5 and $5.0-million. However, MFT reserves were large enough to
accommodate paying for the first year of the program in the 1999/2000 fiscal year. In total,
approximately $3.7-million in improvements were to be financed by bond proceeds and
interest earnings.
Bonds were issued in November 2000 with $3.485-million deposited in the Street
Improvements Fund. MFT revenues are committed to pay the debt service on the bonds.
With an interest assumption of 5.0%, interest earnings were expected to at approximately
$58,000 in 2000/2001, $96,000 in 2001/2002, $53,000 in 2002/2003, and $13,000 in 2003/2004.
Total bond proceeds and interest earnings were expected to finance the $3.7-million in
improvements. The only expenditures coming out of the Street Improvements Fund were to
be for engineering and construction costs related to the reconstruction program in 2000/2001
($1.1-million), and engineering and construction costs for 2001/2002 ($1.0-million),
2002/2003($800,000) and 2003/2004 ($800,000). No other expenses were to be recorded
against the bond proceeds.
In the MFT Fund, the State of Illinois MFT allotments were assumed to total $574,000 in
2000/2001, $625,000 annually from 2001 through 2004, $677,000 annually from 2005 through
2007, and $715,000 annually from 2008 through 2011. Interest earnings were estimated at
5%. Between interest earnings and the state allotments, the MFT Fund was expected to
accommodate the debt service on the bond issue and road salt purchases of $75,000
annually with $75,000 set aside for MFT eligible contingency projects. Attached is an
accounting of the monthly MFT Allocation.
Actual Revenues
The assumptions used for both MFT allotments and interest earnings were incorrect. MFT
allotments recorded in 2000/2001 amounted to $557,287, $16,713 short of the projection. In
2001/2002, the allotments were short $41,303 of the $625,000 projection. The rates
determining the allotments did not meet the estimated rates provided by IDOT and the
Illinois Municipal League.
For interest earnings, the original assumption was based on the interest rates the city was
receiving at the time of the analysis, which was between 5.0% and 5.5%. However, in the
early part of 2001, interest rates dropped below 3% and have remained around the 2.5%
mark. Consequently, earnings missed the projections as well.
Accounting Issues
In addition, to lower than expected interest earnings, there appears to be a number of items
incorrectly posted to the Street Improvements funds. Specifically, the 2000/2001 resurfacing
portion of the program was intended to be paid from MFT Funds. Instead, bond proceeds
were used to pay for the $531,926 program. A few miscellaneous postings should not have
been charged to this fund. These items need to be corrected since IDOT will be auditing the
items charged to the bond proceeds (Street Improvements Fund).
After correcting the errors addressed above, the MFT fund and Street Improvements Fund
will have approximate balances of $468,000 and $1.245-million respectively. Adding the
$100,000 contributions from the General Fund as called for in the budget, brings the total
available for the Street Improvements Fund to $1.345-million. The total available for the
street program is $1.813-million when considering the MFT Fund.
Recommendation
Proceeding with the full street program as bid by the Public Works Department would
exhaust the MFT Fund. A more prudent course of action would be to reduce the street
program by $400,000. To achieve a $400,000 reduction in the cost of the Street Program,
staff is recommending that the Public Works Committee review the program and recommend
streets to be eliminated. By reducing the program, the MFT Fund will maintain a contingency
balance of approximately $300,000, which was planned at the beginning of the street
improvement program in 1999.
It is recommended that the City Council award the bid for the 2002 Street Program to Payne
and Dolan, inc. in the amount of $1,789,214.77; and to set a Public Works Committee meeting
for the purpose of reducing the number of streets in the program.
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BID SHEET
Payne and Dolan, Inc., Antioch, Illinois $1,789,214.77
Peter Baker and Sons, Co., Lake Bluff, Illinois $1,857,524.91
Arrow Road Construction, Mt. Prospect, Illinois $2,134,325.88
MFT FUND
Fiscal Year 2002/2003
Monthly Allocation and
Interest (Assumed 2.5%) $51,014.00
Bond Payment $38,200.00
Road Salt ($75,000) $6,250.00
Contingency ($75,000) $6,250.00 __________
Total: $50,700.00 $51,014.00
Difference: $314.00