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City Council <br />Special Meeting Minutes <br />June 7, 2016 <br />Page 4 of 5 <br />City Manager Fleming stated initial estimates for O &M are $700,000. <br />Jim Manire noted whatever the Council decides on the term or amount of the bond, the <br />number in the ballot language (which is the full repayment cost) needs to be high <br />enough to accommodate fluctuations in the market. <br />Finance Director Watson noted that making the bond longer will increase the annual <br />cost to the residents and could get higher than the $150 per year cost to residents <br />(based on a $500,000 home). <br />Mayor Pro Tem Lipton stated there is value in matching the life of the asset (the <br />building) to the life of the bond and he supports 25 years. He added interest rates are <br />low now so it is a good time to borrow <br />Councilmember Maloney supports 25 years for the bond to give greater flexibility. He <br />asked what the total cost projection for the construction is. <br />Councilmember Loo stated the goal of the Task Force has been to keep it under $30 <br />million <br />Councilmember Maloney stated his support for property tax for construction and a sales <br />tax for O &M for a 25 -year bond. Councilmember Keany agreed. <br />Mayor Muckle noted his preference for 20 years on the bond. <br />Mayor Pro Tem Lipton asked when the taxes would start. Would it be before the facility <br />is built? Councilmember Keany noted the property tax would start when the bond is <br />issued Deputy City Manager Balser stated the sales tax for O &M would be instituted to <br />coincide with the opening of the new facility. Parks & Recreation Director Stevens noted <br />it would likely take until 2019 to construct and get a new facility open. <br />Councilmember Loo stated it is unconscionable a new recreation center won't be open <br />until 2019 if the taxes are approved in 2016. She would like a much faster schedule. <br />City Manager Fleming noted it is a $30 million project and it will take time given the size <br />of the project, how long design takes, and all of the regular day -to -day work staff has. <br />He noted the wastewater plant project is also about $30 million and it has an 18 -month <br />construction,time for a plant that was already designed. <br />Director Watson stated best practices would be to not issue the debt until it is needed. <br />Councilmember Maloney noted his concerns that construction costs are rising rapidly <br />and can the process be speeded up. <br />