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Council reviews three loan proposals for city shop financing; staff to return with payment calculations
Summary
Finance staff presented three financing offers (DNB, 1st Interstate/Hometown, 1st National) with differing amortizations and balloon schedules; the council directed staff to obtain explicit payment figures and prepare a resolution for bond counsel.
Staff presented three lender proposals for financing the new city shop and asked council to give direction. The finance presentation summarized options including DNB (20-year loan term amortized over 30 at a roughly 5.75% fixed rate), 1st Interstate (5-year balloon, 25-year amortization) and 1st National (multiple options, one with the most favorable effective rate). "The lowest would be 1st National Bank," staff said, while also noting that some offers include conditions such as a deposit-relationship requirement.
Councilors discussed tradeoffs including deposit-relationship demands, potential prepayment penalties on some offers, and the need to see exact payment schedules rather than only rate percentages. The council moved and approved a direction for staff to obtain precise payment calculations and to reconvene with bond counsel and a resolution authorizing the financing. "So tonight, you can do a you can provide the direction with a motion ... we do need to get back to bond counsel," staff said. The council agreed to a special meeting to review final payment numbers and adopt the necessary resolution.
