06/27/1984 Meeting - Laserfiche WebLink

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VI. RESOLUTION REGARDING TAX ANTICIPATION NOTES (Tans) (memo, resolution distributed) e Assistant City Manager David Whitlow introduced the agenda item. Finance Director Warren Wong presented the staff report, reviewing his June 20, 1984, memorandum to the City Council. He explained that First Interstate Bank of Oregon had contacted the City when it learned of the City's interest in issuing tax anticipation notes, offering to purchase the entire $4.5 million issue at 6.75 percent interest rate, the effective interest rate to be 6.85 percent. Mr. Wong stated that the savings in interest payments will be approximately $30,000. He added that First Interstate Bank had chosen the City's issue based on the credit rating and financial management practices of the City of Eugene. Councilor Holmer asked if the resol~tion language should be changed to reflect that the FY85 Budget has been adopted. City Attorney Keith Martin responded that the language should be changed. In response to a question by Councilor Ehrman, Mr. Wong stated that the commitment fee had already been paid. Res. 3865--A resolution authorizing the issuance of tax antici- pation notes. Mr. Obie moved, seconded by Ms. Wooten, to adopt the resolution as amended. e Councilor Hansen said he hoped that the City would borrow only those funds as needed, stating that excessive borrowing would increase interest rates. Mr. Whitlow said that suggestion would be consistent with the financial management policies as adopted by the council. Councilor Obie said he understood that the City would place any excess funds borrowed in invest- ments as proposed in the FY85 Budget, resulting in an increase of $100,000. Mr. Whitlow explained that the council had adopted a policy to eliminate the use of external borrowing for cash flow purposes but that the City Manager had recommended an exception to that policy in the FY85 Budget statement based on several reasons to provide a balance budget. In response to a question by Councilor Ball, Mr. Wong stated that the City had no compunction to put the TANS out for competitive bid and that the City could enter into a negotiated sale on the issuance. Mr. Whitlow added that the use of obtaining Tans on a negotiated basis was a common practice among local governments throughout the country. He said the City has been fortunate in being able to avoid the practice. Roll call vote; the motion carried unanimously, 8:0. VII. REVIEW OF SPAY/NEUTER CLINIC (report distributed) Assistant City Manager David Whitlow introduced the agenda item. City Recorder Karen Goldman presented the staff report, reviewing the June 27, 1984, report of the Advisory Committee on the Spay/Neuter Clinic. - MINUTES--Eugene City Council June 27, 1984 Page 5