Moorhead council approves parameters for up to $27 million in bonds to renovate City Hall

The Moorhead City Council on Jan. 26 approved a parameters resolution authorizing the Moorhead Economic Development Authority to issue lease revenue bonds to fund renovations to the city’s existing City Hall.

Chris Hogan of Baker Tilly told the council the EDA plans to issue $25,465,000 in lease revenue bonds (Series 2026A) under a lease-sublease structure, with the city entering a lease to make annual lease payments. Hogan said the documents set a not-to-exceed borrowing cap of $27,000,000, a true interest cost not to exceed 5.5%, a final maturity of Feb. 1, 2046, and a 20-year repayment term. He also said the bonds include a 10-year optional redemption provision.

The presentation described a sublease under which Moorhead Public Services would pay $250,000 annually toward the lease for 20 years and the city would levy taxes annually to appropriate the remaining lease payments.

Council member Heather Niesmeyer moved to approve the parameters resolution; the motion was seconded and carried on a roll-call vote. Mayor Shelly Carlson thanked Baker Tilly and Finance Director Jennica Flanagan for preparing the financing documents.

Why it matters: The financing lays out the framework for selling the bonds and sets maximum terms and cost thresholds. The parameters resolution authorizes the EDA to finalize terms and complete the sale; the pricing committee will award the bonds on the day of sale and the sale will not return to the council for separate approval on pricing.

What’s next: Hogan said the EDA board will consider a resolution providing final bond terms next week and the bonds are expected to sell on March 10.