11/07/2002 City CouncilEDMONDS CITY COUNCIL APPROVED MINUTES
November 7, 2002
The Edmonds City Council meeting was called to order at 4:13 p.m. by Mayor Pro Tem Dave Earling in
the Council Chambers, 250 5t' Avenue North, Edmonds, followed by the flag salute.
ELECTED OFFICIALS PRESENT STAFF PRESENT
Dave Earling, Mayor Pro Tem
Peggy Hetzler, Administrative Services Director
Dave Orvis, Council President Pro Tem
Stephen Clifton, Community Services Director
Michael Plunkett, Councilmember
Cindi Cruz, Community Services Exec. Asst.
Jeff Wilson, Councilmember
Sandy Chase, City Clerk
Richard Marin, Councilmember
Linda Hynd, Recorder
Deanna Dawson, Councilmember
Lora Petso, Councilmember
1. APPROVAL OF AGENDA
COUNCILMEMBER MARIN MOVED, SECONDED BY COUNCILMEMBER ORVIS, FOR
APPROVAL OF THE AGENDA. MOTION CARRIED UNANIMOUSLY.
2. CONSENT AGENDA ITEMS
COUNCILMEMBER MARIN MOVED, SECONDED BY COUNCILMEMBER PLUNKETT, FOR
APPROVAL OF THE CONSENT AGENDA. MOTION CARRIED UNANIMOUSLY. The agenda
item approved is as follows:
(A) ROLL CALL
3. PROPOSED ORDINANCE AUTHORIZING THE SALE OF APPROXIMATELY $6.9 MILLION
IN BONDS FOR THE EDMONDS PUBLIC FACILITIES DISTRICT
Administrative Services Director Peggy Hetzler addressed the City Council on the progress of the sale of
the Edmonds Public Facilities District bond issue. She noted that Dick Ehlers, an underwriter with
Seattle -Northwest Securities, would provide details on the pricing, interest rates and .par value of the
bonds; Bob Yeasting, an independent financial advisor, would provide information about the bond sale;
and Bill Tonkin of Foster, Pepper, Shefelman would present the bond ordinance for Council's approval.
Richard Ehlers congratulated the City of Edmonds on its timing for entering the bond market. He
reminded Council that the issue was sized to be paid from a combination of Public Facilities District
(PFD) revenues from the Edmonds and Snohomish County PFD'S, plus one million dollars to be funded
by the City. He explained that $7,015,000 in bonds had been marketed, with $6,015,000 being paid from
the combined PFD revenues, and the other million dollars being funded by the city. Net proceeds, after
costs, will be approximately $6.9 million, with a proposed closing date of November 19.
Mr. Ehlers discussed the rating process for selling the bonds and confirmed Moody's rating of Al for the
City on its limited tax general obligation bond, a non -voted bond, and a rating of Aa3 on the voted bonds.
Edmonds City Council Approved Minutes
November 7, 2002
Page 1
A cost benefit analysis was done that led to purchasing bond insurance and resulted in a AAA rating that
led to a lower interest rate, and the savings from that paid for the cost of the insurance. A provision was
included to call the bonds at any time after ten years. The true interest cost on the issue will be 4.67
percent for a 24 -year issue.
Mr. Ehlers talked about the price of the issue and pointed out that all but about $20,000 worth of the bond issue
was marketed and was purchased by institutional buyers, primarily bank portfolios, from other parts of the
country. He pointed out that the AAA rating, combined with the Al underlying rating on the City's credit, plus
being able to designate the bonds as what are called bank -qualified, provided an added tax incentive for banks
to purchase the bonds for their portfolio.
Responding to questions, Mr. Ehlers explained that it is standard procedure that bond orders are taken and
confirmations are not written until Council takes action on the issue.
Robert Yeasting discussed the recent interest rates. He talked about the effects certain events have had
on the market. He thought that Seattle -Northwest Securities did an excellent job in moving the rates to
where they needed to be, and recommended that Council award the bonds on the basis of the offer that
has been presented.
Bill Tonkin explained that the form of the bond ordinance before the council incorporates the pricing
inforniation that was developed in the pricing of the bonds earlier, with various interest rates and maturity
amounts. He stated that the passage of the ordinance would authorize the issuance and sale of the bonds
through Seattle -Northwest Securities, would approve the execution of the bond and purchase contract with
Seattle -Northwest Securities, and would authorize the use of the bond insurance.
COUNCILMEMBER MARIN MOVED, SECONDED BY COUNCILMEMBER PLUNKETT, FOR
APPROVAL OF ORDINANCE NO. 3425. MOTION CARRIED UNANIMOUSLY (7-0). The
ordinance approved is as follows:
AN ORDINANCE OF THE CITY OF EDMONDS, WASHINGTON, RELATING TO
CONTRACTING INDEBTEDNESS; PROVIDING FOR THE ISSUANCE OF $7,015,000 PAR
VALUE OF LIMITED TAX GENERAL OBLIGATION BONDS, 2002, OF THE CITY FOR
GENERAL CITY PURPOSES TO PROVIDE FUNDS WITH WHICH TO PAY COSTS OF
ACQUIRING AND RENOVATING FACILITIES FOR A PERFORMING ARTS THEATRE,
CREATING ON-SITE PARKING, AND CONSTRUCTING A MEETING ROOM FOR THE
THEATRE; FIXING THE DATE, FORM, MATURITIES, INTEREST RATES, TERMS AND
COVENANTS OF THE BONDS; ESTABLISHING A BOND REDEMPTION FUND AND A
CONSTRUCTION FUND; PROVIDING FOR BOND INSURANCE; AND APPROVING THE
SALE AND PROVIDING FOR THE DELIVERY OF THE BONDS TO SEATTLE -NORTHWEST
SECURITIES CORPORATION OF SEATTLE, WASHINGTON.
4. MAYOR'S COMMENTS
Mayor Pro Tem Earling thanked the participants for their efforts.
5. COUNCIL COMMENTS
None.
Mayor Pro Tem Earling adjourned the meeting at 4:28 p.m.
G ENSON, MAYOR -SANDRA S. CHASE, CITY CLERK
Edmonds City Council Approved Minutes
November 7, 2002
Page 2
AGENDA
EDMONDS CITYJCOUNCIL
Council Chambers, Public Safety Complex
250 5th Avenue North, Edmonds
NOVEMBER 7, 2002
4:00 p.m.
Special Thursday Meeting
4:00 p.m. - Call to Order
Flag Salute
1. Approval of Agenda
2. Consent Agenda Items
(A) Roll Call
3. (30 Min.) Proposed Ordinance authorizing the sale of approximately $6.9 Million in
Bonds for the Edmonds Public Facilities District.
4. ( 5 Min.) Mayor's Comments
5. (15 Min.) Council Comments
ADJOURN
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Contact the City Clerk at (425) 771-0245 with 24 hours advance notice for special accommodations.
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