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Refinancing bonds cuts Winsted’s debt by $860,797
March 12, 2012
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By Linda Scherer
Staff Writer

WINSTED, MN – “Timing is everything,” City Administrator Brad Martens told the Winsted City Council at Tuesday’s council meeting when he announced the city cut its debt by $860,797, after refinancing the city’s general obligation bonds Feb. 22.

In January, Steve Mattson of Northland Securities estimated he could reduce Winsted’s debt service by as much as $374,000 if the city took advantage of the current low interest rates and approved the issuance of general obligation crossover refunding bonds.

Mattson also asked the council to approve a trigger resolution so, when the time was right, he could sell the bonds with just the mayor and city administrator’s approval rather than waiting for the council’s next meeting.

The three bonds refinanced, which totaled $4,615,000, were a 2006A water and sewer revenue bond, a 2006B bond for the public works building, and a 2007A bond for the city hall.

The majority of the savings is due to shortening the bond term by three years on the largest bond, which is for the city hall.

Additionally, there will be annual debt service savings from 2015 until the bond is paid off in 2033. The majority of the annual savings from debt service are from the sewer bond.

In order to refinance the bonds, Winsted needed a bond rating, something that was not previously required.

Martens was pleased to tell the council the city had received an A+ bond rating.

According to Standard and Poor’s, the rating describes a city with a strong capacity to meet financial commitments.

Vollmer Room use policy clarification

Nancy Fasching and Julie Guggemos, members of the Winsted Arts Council, addressed the council during an open forum Tuesday regarding the Vollmer Room use policy for nonprofit community organizations.

The arts council would like to schedule various classes in the Vollmer Room, and for some of the classes, it would require a fee to cover the cost of the instructor.

“We would like to clarify that is within the current policy, or if the policy would need to be amended to allow that?” Guggemos asked.

Martens told the council that although the arts council is on an approved list as a community organization to use the Vollmer Room, there is a clause in the policy that states if there is revenue generated from the use, it doesn’t fit the criteria.

“We would just be covering costs,” Guggemos said. “The arts council is kind of limited in where we can present or host events of this kind in the community.”

“For the arts council to pay a rental fee in addition to the cost of the class might make it “prohibitive to community members which then makes the whole thing pointless because we want to offer these classes to the community at a rate they can afford.”

Council Member Bonnie Quast asked if the policy would allow for a goodwill offering at the door?

Martens said that it would have to be open to everyone.

Guggemos explained that it would be necessary to have people apply for the classes and submit a fee before the class so they could have a count of how many people would be attending.

Council Member Dave Mochinski, who was on the council when the policy was approved, said the policy should be made clearer because nonprofit community organizations with this type of scenario should be able to use the Vollmer Room and be reimbursed for the cost of the event.

Council Member Tom Ollig, who was also on the council at the time the policy was approved, provided a little history on the policy.

“When the city hall was built . . . there were businesses in town with facilities in town that feared that the city would be taking revenue away from them by letting organizations use the community room. In writing a covenant for the guidelines of use, we tried to be very specific in reassuring those businesses the city was not in the business of competing with them.”

Fasching said all the arts council was asking for was a quiet space that can offer opportunities for the community.

“The community is crying out for these opportunities,” Fasching said. “When we did the Blandin Leadership training, one of the areas that we found lacking in our community is the arts. So, if we have this wonderful space that is nice, quiet space that gives respect to what people are doing, we would want to offer that. If there was something where we could go to a business and have it there, we are all about doing that . . . I think it’s about having an appropriate venue.”

Because the Vollmer Room policy was brought up during the open forum, the council didn’t take any action, but Mayor Steve Stoko told Fasching and Guggemos that city staff would be directed to get more information on the policy and the council would follow up on the matter.

Odds and ends

In other business, the council:

• scheduled a public hearing Tuesday, March 20 at 6 p.m. to consider amendments to the building permit fee schedule.

• approved the appointment of Michelle Baird to the Winsted Airport Commission as a member-at-large with a term expiring Dec. 31, 2015.

• approved the appointment of Petie Littfin to the Winsted Park Commission with a term expiring Dec. 31, 2012.

• approved conditional offers to Michael Rasmussen and Trevor Williams to become members of the Winsted Volunteer Fire Department contingent upon the successful completion of medical examinations and alcohol and drug testing.

• approved an agreement between the city of Winsted and Holy Trinity for emergency services Thursday to Saturday, June 7-9, during the Winstock Country Music Festival.

A sum of $500 is to be paid to the Winsted Fire Department for its services, and overtime pay accrued by the Winsted police chief related to the Winstock event dates should be paid to the city.

• approved a land lease between McLeod County Road 5 and the private hangars at Winsted Municipal Airport to Winstock Country Music Festival for $1,000 for Thursday-Saturday, June 7-9.

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