HomeMy WebLinkAbout1988-03-29 CC Packet
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THE BIRTHPLACE OF MINNESOTA J
March 23, 1988
MEMO
TO: MAYOR AND COUNCIL
FR: MARY LOU JOHNSON, CITY CLERK
RE: SPECIAL COUNCIL MEETING, TUESDAY, MARCH 29, 1988
This memo is a reminder to Council that a Special Meeting has been scheduled
for Tuesday, March 29, 1988 at 4:30 p.m. in the Council Chambers of the
Stillwater City Hall to discuss the following:
1. Hazel Street Repair/Railroad Crossing.
2. Data Retention Schedule.
3. Resolution of Employment - Temporary Laborers for Parks Department.
4. Possible discussion of MSA & county road turnbacks.
5. Other Business.
CITY HALL: 216 NORTH FOURTH STILLWATER. MINNESOTA 55082 PHONE: 612-439-6121
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ENCINEERS . ARCHITECTS. PlANNERS
222 EA5TLlTTLECANADA ROAD, 5T. PAUL, MINNE50TA 55717 672484-0272
March 22, 1988
RE: STILLWATER, MINNESOTA
CITY ENGINEER
SEH FILE NO. 87007
MAYOR AND COUNCIL MEMBERS
CITY OF STILLWATER
CITY HALL
216 NORTH FOURTH STREET
STILLWATER, MN 55082
Dear Council Members:
At your request, we have studied the drainage area contributing
to the railroad crossing on Hazel Street.
Our investigation revealed that a solution could be provided
simply by extending the present 24" CMP on the north side of
Hazel Street and putting an apron on the end. This will also
require some excavation with a bituminous spillway and curbing to
direct the storm water to the flared end (See attached drawing).
As Hazel Street develops west of the railroad, additional inlets
and storm sewer will be required to intercept the runoff at
intersections such as 4th Street, 3rd Street, and 2nd Street.
This solution should alleviate the drainage problem at the
railroad crossing. We estimate the materials to construct the
proj ect as shown on the attached drawing to cost approximately
$300 for the 24" pipe, bend and apron section. If the bituminous
material for the spillway and curbing is placed by City
personnel, the material will cost approximately $110. Total
material cost will be approximately $410.
This letter should provide the Council with the information
required to reach a decision on the crossing with the railroad
company. If you have any questions or need clarification, we
will be happy to discuss this with you.
{;)lj fff!);I-~
Richard E. Moore
REM/cjc
Enclosures
5HORT ELLIOTT
HENDRICKSON INC
CHIPPEWA FALLS,
WI5CON51N
5T. PAUL,
MINNE50TA
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\ 11j?1} MINNESOTA TRANSPORTATION MUSEUM, INC.
.'-,. / 'Accredited by the Minnesota Historical Society
....... _."
1225 Westminster Street #11
St. Paul, Minnesota 55101
March 8th, 1988
Mr. Nile Kriesel
City of Stillwater
Public Works Department
Stillwater, Minnesota 55082
Dear Sirs:
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I would like to thank you for your time and effort thus
far involving the Hazel Street repair project. I am ex-
pecting estimates on railroad right-of-way repairs wi thin
days, which should be a very good starting point.
I would like to ask that the City of Stillwater furnish
all pavement involved(removal/installation), all road re-
routings, and other agreed upon expenses at a future date.
I believe, at this point, that total city expenses should
not exceed $1,500, excluding any additional street work
not involving the grade crossing. I would appreciate it
if the city could also provide drain apparatus involved
with the crossing.
If we could come to agreement on these known terms, and
additional terms, as they are known, I would like to have
this project completed by April 27th, 1988. I very greatly
appreciate your help, and as a member of this volunteer-
non-profit organization, I hope you can understand our
limited resources for these projects. I believe that neigh-
bors near the property will benefit, as will the museum.
Thank you for your time and consideration.
.
~relY,~---=
,~~
Thomas G. Dethmers
Stillwater and St. Paul RR
Superintendent
PLEASE REPLY TO
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MINNEAPOLIS
SAINT PAUL
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ii!iI Bid Committee
.- i I ~;~7~h Olympiad
Minneapolis-Saint Paul
... .:. ~
March 9, 1988
Dear Mayors:
On behalf of the Committee for the Twin Cities Olympic Bid, we wish to thank
you for attending tonight's meeting and for your interest in our efforts to
attract the 1996 Olympic Games to the Twin Cities.
We hope .ypu will leave tonight's meeting w~th the clear message that we are
the most viable candidate to be selected as the United States bid city to the
International . Olympic Committee. We believe the. Games will have a
tremendously positive economic impact on the metropolitan area and Duluth-
Superior and will leave a legacy benefitting our youth through amateur
athletic programs and facilities. We have assembled this packet to provide
you additional information regarding o~r bid.
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Our ability to demonstrate'strong community support to members of the United
States Olympic Committee is an essential element in our bid effort. As such,
we ask that you submit two pieces of evidence in support of our bid efforts:
- Please submit a personal letter of support (refer to the enclosed
sample letter)
- Please introduce and lobby for a resolution of support from your city
council. (refer to the enclosed sample resolution).
We can't stress enough the importance of these actions. The letters and
resolutions we receive will be the chief documentation which we will present
to the U.S.O.C. as evidence of local support for our bid effort.
Thank you in advance for your valuable support of our bid. We look forward to
continuing to work with the many communities surrounding the metropolitan
areas of the Twin Cities and Duluth-Superior which will playa major role in
the success of this major athletic event.
)
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Roger Parkinson
Chairman
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88-67
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SUMMARY
TWIN.CITIES BID
FOR THE
1996 SUMMER OLYMPIC GAMES
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Minneapolis/Saint Paul
March 8. 1988
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INTRODUCTION
A.
INDTRODUCTION.. .
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B.
VENUES
1. Already in Place and, Close Together. . . . . . . . . . . .
2. Olympic Stadi1Dll . . . . . . .
3. Proposed 1996 Olympic Venues. ..............
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C.
HOUSING
1. Olympic Village .
2. Olympic Family. . . . . .
3. Visitor Housing
4. Duluth Housing.
5. Overall Housing Capacity.
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D.
ABOUT THE TWIN CITIES
1. Minneapolis.. . . . .. .. .
2. SaiDt Paul . . . . . . . . .
3. The Metro Area. . . . . .
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E.
DULUTH-SITE OF THE YACHTING COMPETITION
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F.
SOUND BACKING AND SUPPORT
1. A Prime Location For Prime Time Television. .
2. New State-of-the-Art Press Center Services. .
PriDt and Broadcast Media .
A Committed Corporate Community . . .
A Government Dedicated To Amateur Sports.
A State of Spectators and Participants.
A Track Record of Olympic Bidding
Host to the 1990 Olympic Festival
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3.
4.
5.
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7.
G.
TRANSPORTATION
1. Air. .
2. Land. .
3. Duluth.
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A PARTNER WITH THE WORLD
1. Headquarters for 91 Mol tinational Corporations.
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1.
A DIVERSB ECONOMY MEANS A STABLR ECONOMY.
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J. WORLD-RENOWNED FOR HEALTH CARE ~
1. Hospi tals . . . . . . .. .......
2. Health Care: Minnesota's Number One Industry .
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K. GREAT WEATHER, GREAT, AIR.
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FINANCIAL DATA. . . . . .
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March 8, 1988
Introduction
On September 15, 1987 the cities of Minneapolis and Saint Paul submitted a proposal to
the United States Olympic Committee (USOC) which was endorsed by Governor Rudy
Perpich, by George Latimer, Mayor of Saint Paul and by Donald Fraser, Mayor of
Minneapolis. Minneapolis and Saint Paul enthusiastically submitted a bid for the Games
of the XXVI Olympiad confident of their ability to give the world a successful,
memorable event.
Minneapolis and Saint Paul offer tremendous advantages for staging a successful Games. .
At the present time we meet or exceed the requirements for athletic facilities, housing,
and transportation which form the infrastructure of an Olympic Games. A wealth of
Olympic-calibre athletic facilities, most ofthem devoted to amateur sport, already exist
Also, there is an aggressive statewide campaign to fund and build amateur sports
facilities, insuring our commitment to have the best facilities available both for the
Games and for amateur sport for many years to come.
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Most of the venues for the Games are located within.our very compact metropolitan area
near the planned new Olympic Village. Transportation by private shuttle bus for the
Olympic athletes, coaches and officials will be convenient and brief. And, many of the
venues will be linked by a light rail transit system, which will also connect the nearby
international airport to our cities.
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Minneapolis and Saint Paul are national leaders in creating dynamic public-private
partnerships. They have a long track record of hosting successful events, such as the
internationally known Twin Cities Marathon. Our sports-minded enthusiasm makes it
possible for us to provide homes to six major league sports teams (baseball, football,
basketball, soccer, hockey and volleyball) and to take on the challenge of hosting the
1990 U.S. Olympic Festival. This spirit of public and private cooperation will infuse our
dedicated efforts to produce an Olympic Games that are the pride of our state and our
country, and a model to all those around the world who uphold the Olympic ideal.
It is the Twin Cities privilege to have this opportunity to bid for the Games of the XXVI
Olympiad. Minneapolis and Saint Paul will provide fertile ground for furthering the
Olympic cause. Our region's concern for wellness and sport, coupled with our strong
, cooperative spirit provides the foundation upon which a dispJay of international amity,
culture, and good-natured competition thrives. An Olympiad in the Twin Cities will best
demonstrate to the world the driving forces behind the Olympic movement: heartfelt
friendship and respectful competition.
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B. VENUES
1. Already in Place and Close Together
Minneapolis-Saint Paul is in a superb position to host the Games.
Most athletic facilities already exist and are well equipped for
Olympic competition. All the venues except yachting are within the
Twin Cities metropolitan area in close proximity to each other
m~y within walking distance of one another. These sites are also
well-connected by an excellent highway system, public bus service,
and a new planned light rail transit system.
The accompanying map locates the proposed competition
proximity to one another, to the two downtowns and to
system..
venues in
the hi~hway
Of the 27 competition venues needed to host the 1996 Olympics in the
Twin Cities, 21 already exist and 5 more are planned to be
constructed regardless of whether or not the Twin Cities host the
Olympics. Only 1 facility would need to be built specifically for
the Games, namely, the Olympic Stadium.
The wealth of outstanding sport facilities within th~ metro area is
unparalled in the nation. They include the following:
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Large indoor arenas:
4 with seating capacities ranging from 16,000 - 63,000; average:
28,460 seats
9 with seating capacities ranging from 3,000 - 7,300; average:
4,611 seats
10 with seating capacities ranging from 1,800 - 2,400; average:
1,955 seats
- 1 facility for 18,000 spectators to be constructed by 1989
o Smaller indoor arenas: 40
o Major field houses:
constructed in 1988
4, with 1 additional facility to be
o . Major stadia (not including the Metrodome and high school stadia):
4 with a capacity for 10,000+ seats
4 with capacities ranging from 5,000 - 9,300
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2. Olympic stadium
Only one facility will be buiit expressly for the Olympic Games, the
Olympic Stadium. I The capital construction costs of the stadium could
range between $55-77 million depending on the type and size of
stadium. Olympi~ proceeds would be used to construct the stadium. A
stadium seatinglbetween 70-90,000 spectators would host the Opening
and Closing Cere~onies, Track and Field events, finals in Football
(soccer) and Gr~d Prix Jumping (equestrian) events. Two sites are
being evaluated for the stadium.
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a. University or. Minnesota, Minneapolis
As the site f five athletic competitions, the University has the
appeal of being a center of Olympic action. An Olympic stadium
here could pe developed on underutilized land on or adjacent to
h ' !
t e campus. :
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This option I would allow the University to continue its planned
sport facility development program now in progress. The
University is located on the planned light rail transit line,
making accefs to either downtown and to the airport quick and
easy. Withir walking distance are dorm~tory rooms for over 5,000
people whicf can house officials, members of the press and
othe~s. !. ~ .
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The University area has many interesting restaurants and shops to
serve Olympi~ visitors, and more than 20,000 existing and planned .
spectator parking spaces. '
b.
Blaine
Blaine
soccrr/Track
and Field Stadium,
Blaine Sports
Complex,
This facilit~. was funded by the Minnesota Legislature in 1986 and
is now in th final planning stages. While the original stadium
was to be de igned for 12,000 spectators, the Minnesota Amateur
Sports Commi~sion, ~hich will operate the stadium, is considering
building a 3P,000-to-45,OOO seat stadium that can be expanded
with temporary seating to 90,000.
When comple~ed in 1989, the Blaine Sports Complex will also
include a velodrome and an indoor football (soccer) field, as
well as do~itories. It will be a National Training Center for
football, cYcling and athletics. The Blaine Sports Complex has
at least 15,000 parking spaces on-site and on nearby public land.
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fROPOSEO 1996 OLYMPIC VENUEi
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Revised 3/07/88
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PROPOSED 1996 OLYMPIC VENUES
MAP
In VENUE
'SEATING
CAPACITY
fQ!! gMm~
VENUE
IMPROVEMENTS
!!~g!!!!!~!!
TYPE OF
f~Q!1!'!Y
14: Fort Snelling Polo
Grounds, St. Paul
6,480
6,480 temporary seats
Existing
Proposed Olympic Stadium
Sites
5. University of
Minnesota, Minneapolis
6. Blaine Stadium, Blaine
Bid
New construction
70-90,000
10. Macalesler College, Existing 4,000
Fieldhouse, St. Paul
3. Hubert H. Humphrey Existing 56,000
Metrodome, Minneapolis
2. NBA Arena, Minneapolis Planned 18,000
15. Met Center, Bloomington Existing 18,140
13. J,ake Phalen, St. Paul Existing 20,000
2,000 temporary seats
None
New construction
None
20,000 temporary seats
Minor expansion of
rowing course
6. Blaine Velodrome, Blaine Planned 8,000
17. Bush Lake, Bloomington Existing Open
l. State Highway 12, Existing Open
Minneapolis to Deluno
, 18. Normundule Community Planned 10,000
College, Bloomington
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New construction
None
None
New construction
SPOilT
Archery
Athletics, Football
(Soceer) and
Equestrian (Grand
Prix Jumping)
Badminton
LO
llasehall
Baslwlball
Boxing
Canoeing and Rowing
Cycling (Track)
Cycl ing (noad Race)
Cycl.ing (Time Trials)
Iliving, Swimming and
Synchr'onized Swimming
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MAP
In VENUE
8. State Fairgrounds, St. Paul
a) Grandstands
b) Coliseum
20. Minnesota Horse and
Hunt Club, Prior Lake
9. College of St. Thomas,
St. Paul
12. st. Paul Civic Center
4. Augsburg College,
Minneapolis
a) Athletic Field
b) Si Melby G~asium
5. University of Minnesota,
Minneapolis
a) Mariucci Arena
b) Swim Center
c) Northrop Auditorium
d) Williams Arena
7. Les Bolstad Golf Cotirse,
. Paul
TYPE OF
!:~Q!1!:rY
SEATING
CAPACITY.
!:QR g~~
VENUE
IMPROVEMENTS
!!~g!!!!!~!!
Existing
26,000
14,000 temporary seats
Existing
5,800
None
Existing
Open
None
Existing
, 4, 360
2,720 temporary 'seats
Existing
15,700
None
Existing
Existing
9,260
3,000
7,660 temporary seats
None
Existing
7,300
None
Planned
5, 100
New' construction
Existing
4,800
None
Existing
18,000
None
Existing
Open
None
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SPOILT
Equestrian (Dressage
and Jumping) and
Modern Pentathlon
(Riding)
Handball (Team)
Equestrian (Endurance)
Fend ng and Modern
Penlathlon (Fencing)
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Gymnastics
Bodey (Field)
Table Tennis
Judo
Swimming (Water Polo)
Bnd Modern Pentathlon
(Swimming)
Weight Lifting
Volleybull
Nod(~r-lI Pentathlon,
(HUlln.ir.
SEATING VENUE
MAP TYPE OF CAPACITY IMPROVEMENTS
I!! ~~~!l~ f~Q!1!!! fQE g~~ !mQ!!!!m!! ~rQ!rr
16. Minnesota Shooting Center, Planned 5,000 New construction Shooting and Modern
Rosemount Pentathlon (Shooting~
19. 98th Street Racquet Club, Existing 5,000 5,000 temporary seats Tennis
Bloomington
11. Wilkins Auditorium, Existing 5,700 None Wrest.ling
St. Paul
2l. Duluth Harbor, Duluth Existing Open None Yachting
~!!!!!m!!r:i
Number of Percent of
!YE~ Qf !!!f!!!!Y ~~Q~[ ~~!!!~ ~~!!!!
Existing 21 209,550 62
. Planned 5 47,000 14
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Bid* _1 _~Q.J:QQQ _g1
Totals 27 336,550 100
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*To be constructed only if Twin Cities are selected to host the Olympics
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C.
HOUSING
1. Olympic Village
Several sites within the Twin Cities would be available for a
potential Olympic Village. The strategy is to time the development
of one or two of these sites to coincide with the 1996 Games. This
way the team members could be the first occupants of the housing and
after the Games the units could be sold for private use. Olympic
proceeds could be used for rental costs during the Games and possibly
for financing the development.
We are proposing a single Olympic Village be
Shoreham-Marshall site in Northeast Minneapolis.
a two-site Village.
developed on the
A second option is
a.
Sing+e Site
Our proposed Olympic Village is a 105 hectare (250 acre)
development large enough to house all athletes at a single site.
The site is bounded east and west by Central and University
Avenues, north and south by 27th Avenue and St. Anthony
Boulevard. Shoreham-Marshall, located in a residential
Minneapolis neighborhood, is an ideal location for a ,single-site
Village. It is just 5 km (3 mi) from both the University of
Minnesota venues as well as the headquarter hotels in downtown
Minneapolis. A full-service hospital is also located just 5 km
(3 mi) away.
The Village can accommodate up to 16,100 people and be easily
secured. Lodging, meals and all services will be subsidized for
athletes and team members. All housing will he large,
comfortable and attractive. Beds will be limited to no more than
two per room. All support amenities for the athletes will be
included. A lake on the property and an adjacent golf course.and
city park ~ill add to the pleasant surroundings.
b. Two-Site Option
A second Olympic Village option is to combine two sites; the
University of Minnesota and a planned housing development in
either Saint Paul or Minneapolis. The Uni verSlity, with a 1996
capacity for more than ,6,000 people, is an ideal location. Its
dormitories are clustered together.ai1<i.capbe easily secured.
Many venues and practice areas are withinw?llktng distance. The
University would be combined with a second site only minutes
away-developments either 00 the Minneapolisriverfroot area or
in downtown Saint Paul-:-to accoJIDDodate the additional 10,000 team
members. The two-Village concept would be. used only if it became
impractical to develop a single large housing site.
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2. Olympic Family
The International Olympic Committee, the National Olympic Committees,
the International tederations and the press will stay in first class
hotels in the heart of the cities. There are more than 6,000 rooms
in the two downt wns and 6,000 more rooms in Bloomington, just
minutes away and ne~t to the airport. In addition to its first class
h?tels, t~e Twin r.Cities has m~ny colleges and universities which
w111 prov1de comr rtab1ehous1ng ror over 13,500 members or the
Olympic Family.
Inexpensive, qua1i~y housing like this is especially important ror
roreign sports off~cials, members of the press and others. Most
campuses are located in the central cities, making transportation to
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venues quick and SO~' etimes within walking distance. If not used for
the .Olympic Villa e, the University or Minnesota will be an
especially conven'ent campus location to house international
ofricials and press
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3. Visitor Housing
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An estimated 200, 00 visitors from outside the metro region are
expected to attend he Olympics each day. The Twin Cities metro area
can easily accommod te this demand with space available ror more than
260,000 Olympic wisitors in hotels, motels, private homes,
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dormitories, mobile homes and recreational vehicle. units.
4. Duluth Housing
.
Duluth. is well-equi ped to house the athletes, the Olympic Family and
spectators for the achting competition. The Olympic Village at the
University of Min esota-Duluth, is located on a 105 hectare (250
acre) site overloo~ing Lake Superior and has the capapcity to house
over 2,600 team mem[ers. This site can be easily secured.
The IOC and Olympic Family will stay in first-class hotels just four
blocks from the ve ue. Firty-eight hotels within 16 km.(lO mi) or
the harbor will pro ide more than 5,000 rooms for visitors.
summarizes the housing capacity or the Twin
5.
The following tab
Cities and Duluth:
Housing Capacity .1 People per Unit
40,400 hotel and mo~el rooms' x 3.0 =
.
13,500 dormitory be s x 1.0 =
25,000 RV and campg ound spaces x 3.0 =
10,000 private home~ and condos x 2.0 =
16, 100 Olympic ViII ge beds x 1.0 =
I Sub Total
5,000 Duluth hotel and motel rooms x 2.0 =
2,600 Duluth dormi ory rooms x 2.0 =
Total
Total Capacity
121,200
13,500
75,000
20,000
16 100
___.1.___
245,800
10 , 000
__2.1.fQQ
261,000
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*Includes 6;000 planned to b on line by 1996
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D.
ABOUT THE TWIN CITIES
Minneapolis and Saint Paul share the Mississippi River, flourishing side
by side. The people of the Twin Cities, totalling over 2.5 mi~lion, also
share in a community which is rich in ethnic, cultural, religious and
racial diversity. The cities also share a well-earned reputation as a
unique metropolitan area. An unequalled combination of cultural
accessibility, educational excellence, recreational opportunity,
transportation ease and an amazingly cl~an environment make the TWin
Cities one of the country's most livable.
Impressive facts back this up. As a cultural center, the Twin Cities is
second only to New York in per capita attendance at theater/arts events.
Renowned travel expert Arthur Frommer named the Twin Cities as one of the
10 best vacation spots in the world. "The Twin Cities" Frommer said,
"now have the distinction of being the cultural capitals of the nation,
ranking second only to New York City." And the Urban Institute of
Washington, D. C. ranked our metropolitan area number one for overall
quality of life.
Together, the very contemporary Twin Cities has retained traditional
values. Visitors remark on o~r hospitality, you can safely walk the
streets of both big cities at night, you won't find cleaner downtowns
anywhere, and our heritage has produced a population with a strong work
ethic.
People of the Twin Cities love to celebrate. We celebrate our four
seasons with Saint Paul's Winter Carnival and Minneapolis' Aquatennial
-- including parades, fireworks, sports competitions, ice palaces and
music. We celebrate our diverse ethnic heritage with Syttende Mai,
Danish Day, Svenskarnas Dag, Ukrainian Day, Norway Day, Welsh gymanfa' s,
and a grand parade in Saint Paul on Saint Patrick's Day. Minneapolis's
Sommerfest is an annual summer event saluting Viennese culture and music.
More music -- from jazz to rock to classical can be heard at our summer
concerts in the parks. The Renaissance Festival, Riverfest and Taste of
Minnesota add to the year's festivities with large numbers attending.
I. Minneapolis
A high energy city, Minneapolis is a thriving center for business,
finance, culture and recreation. Minneapolis is the financial hub of
the Northern Plains. The city is home to the Ninth Federal Reserve
District and two of the nation's largest financial services
companies: First Bank Systems and Norwest Corporation. ~s vendors
to the world, many Minneapolis businesses are internationally
competitive in the areas of high technology, electronics and
computers, bio-medical industries and agri~business. Honeywell,
General Mills and Pillsbury are among these companies.
Minneapolis is world famous for its health care facilities. A
prominent example is the University of Minnesota. This well
respected center for innovation and research can boast open-heart
surgery among its many "firsts." Minnesotans live longer'than anyone
else in the U. S. ow~d in some part to the superior health care
. services available.
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Culturally, Minneapolis is a jewel. Nationally prominent art
galleries, premier special exhibits, and music and dance events fill
the cultural calendar. The Guthrie Theater and the Children's
Theatre Company are i recogn'ized as two of the country's best.
.
More entertainment I in the fonn of shopping and dining can be found
along the Nicollet Mall. This tree-lined avenue is reminiscent of a
European pedestrian boulevard, complete with street vendors selling
fresh flowers and b atwurst.
And when it comes t
participants. Pro
pack them in. The
the Twins won the
city's 11 beautiful
sports, Minneapolis is a city of spectators and
sport events at the Metrodome, right downtown,
whole world witnessed' Twin Cities enthusiasm when
orld Series last October at the Metrodome. The
lakes attract athletes all year round.
Saint Paul is a
In fact, the cit is a national model for preservation of great
historic archit~ctu e. Summit Avenue, a five-mile-long treasure of
turn-of-the-century Victorian homes, is the longest stretch of
residential restora ion in the country. And Saint Paul's City Hall
is America's finestiPUbliC example of Deco architecture.
High atop one of th city's seven hills stands the imposing Minnesota
State Capitol, id ntifying Saint Paul as the center of state
government. In vi w of the capitol is the sleek new Minnesota World
Trade Center. This 34-story beacon serves as Minnesota's link to
international markets.
.
A long-standing cen
arts, electronics
Company, a wor ldw
here as do giant
agricultural cooper
f~nancial company.
er for industry, Saint Paul is noted for graphic
and manufacturing companies. The innovative 3M
de sponsor of the 1988 Olympics, makes its home
such as Land O'Lakes, the nation's largest
tive, and the Saint Paul Companies, a diversified
The city is alive WJth culture. The internationally known Saint Paul
Chamber Orchestra and just-retired Garrison Kellor's "Prairie Home
Companion Show" ar two gems that have put Saint Paul on America's
cultural map. !
;
Saint Paul is a citi that loves sport events. - Every year, the Saint
Paul Civic Center. hosts the country's biggest high school hockey
tournament, as we~l as state basketball and.wrestling tournaments.
In these three wee ends, more than 250,000 people push through the
turnstiles. .
I
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11
.
.
3. The Metro Area
While Minneapolis and Saint Paul are t.he "twins" they share the ti tIe
"metro" with other thriving communities. Surrounding the Twin Cities
is a metropolitan community of big and small t.owns. The] arl!(lst.,
Bloomington (also the state's third largest city), borders both
Minneapolis and Saint Paul. It is home to many business headquarters
and also the International Airport. Bloomington is a mecca for
entertainment, with an 800-shop mall/entertainment center soon to
break ground there. When built it will be the largest in the
country.
Major investments and tremendous growth have characterized the Twin
Cities economic scene over the past few years. Large new commercial
and housing projects combined with numerous historic restorations
have expanded and imprDved the already impressive Twin Cities
skylines. A tally of just the major development projects in the
downtowns of Minneapolis and Saint Paul and within Bloomington total
over $2.5 billion since 1983.
B.
DULUTH - SITE OF THB YACHTING COMPETITION
.
Duluth is the world's largest inland port of call, resting at the head of
Lake Superior. This international city is Minnesota's fourth largest,
with 85,000 people. ,Located just 238 km (150 miles) north of the Twin
Cities, travel times are three hours by car on interstate highways or 45
minutes by air.
Lake Superior is the biggest freshwater lake in the world providing ideal
sailing conditions in the months of July and August when winds are
moderate to challenging and temperatures are in the 21 degree C (70
degree F) range.
This great body of water lends Duluth its scenic beauty and serves as a
focal point for the city's important trade and tourism industries. The
central business district . and the major hotels are located ,just four
blocks from the Duluth harbor area. . Part of the 10,220 sq. m (110,000
sq. ft.) Convention Center, located directly on the waterfront, will
serve as the Olympic press center. -
Near the waterfront are the shops and restaurants of Canal Park, site of
the finishing line for Grandma's Marathon. Each year, 100,000 visitors
come to Duluth for this internationally recognized eyent.
F. . SOUND BACKING AND SUPPORT
1.
A Prime Location For Prime Time Television
.
The location of the host city is critical to the television revenues
earned by the Games. Because Minneapolis-Saint Paul .is in the
Central Time Zone, the Twin Cities is an ideal locatio~ for live
broadcasting of the Games. There is only one hour difference between
Minneapolis-Saint Paul and all East Coast and most West Coast
markets. 'The U. S. is the prime market for advertisers of the Games.
12
And the T\!in Cities' ability to reach the major population centers
during prime time hours is key to securing maximum advertising
revenues.
.
Minneapolis--Saint Paul is also in a prime location for broadcast to
Latin America, European and Asian markets. Our morning broadcasts
would reach most jof Europe during their late afternoon and early
evening hours, w~ile evening events would be televised during the
morning or midday. Furthermore, our northern latitude accounts for
over 15 hours of d ylight during summer months.
2.
The Twin Cities ha advanced satellite broadcast and teleconferencing
facilities. Minn sota-based U. S. TV has developed the most refined
satellite broadca It and receiving technology in the world. Their
"Instantaneous Feedback" (IFB) circuitry allows instant national
satellite audio and video communications. Used" already for new
communications, this system may easily be the next wave of
international comm~ications.
i
New State-of-the-AIit Press Center Serves Print and Broadcast Media
I
The new Minneapol~s Convention Center will be the operations
center for both print and broadcast media. With 93,000 sq.-
million sq. ft.) df planned space, this center will bring all
functions under oni roof.
A single locatio~ for all media means logistical ease and reduced
operations costs. j The center will be linked by fiber optic cable to
all areas in the sven-county metropolitan area. Fiber optic "spur"
lines off the main network will link individual venues to the center.
.
nerve
m (1
media
The Convention Cen er is central to all Olympic sites, just 1 km (.6
mi.) from the h adquarters hotel and 2 km (1.3 mi.) from the
University of Mi nesota. It is also located on the light rail
transit line whi h is planned to serve the downtown areas and the
airport. Fourtee hundred parking spaces on the site will be
available for medi use.
3.
A Committed corpor1te Community
Minnesota corpora~ions are strong, generous supporters of amateur
athletics. 3M'S'j worldwide sponsorship of the 1988 Olympics
exemplifies this commitment. Another outstanding example is
Pillsbury, which ~launched the Twin Cities Marathon six years ago.
Now the Marathon s a national event supported by three other local
corporations and b oadcast live on national television.
!. ~
Twin Cities' com1anies are national leaders" in philanthropy. In
1976, 23 Twin Citres' corporations ,started the nation's first "Five
Percent Club." This' set a national trend ~ong corporations to
contribute five ~ercent, of their pre-tax ~arnings to nonprofit
endeavors. TOday, 1 m9re than 110 local companies receive honors each
year for their gen,rous contributions.
.
I 13
I
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.
.
4. A Government Dedicated To-Amateur Sports
The cit.y and state governments are enthusiastic sponsors of the
Olympic bid. This support parallels Minnesota's ongoing commi.tment
to amateur sport. With the formation of the Minnesota Amateur Sports
Commission and the Minnesota Legislature's $29 million appropriation
for amateur athletic facilities in 1987, the state now leads the
nation in the promotion and development of amateur sport.
Already state supported athletic facilities are designated as
national or regional training centers for cycling, ice hockey,
rowing, biathalon, nordic ski, football (soccer) and athletics.
5. A State of Spectators and Participants
If professional sports are any indication of a city's enthusiasm for
sports, the Twin Cities comes out on top. Minneapolis-Saint Paul is
one of only a handful of American cities that have five major
professional teams; hockey, football, soccer, baseball and now
basketball. Last year, Minnesotans spent over $830 million on sports
events and equipment.
.
But Twin Citians are not just passive spectators. They participate
in sports. And they organize them, sponsor them, and market them--
often on a volunteer basis. Notable sport events include the 1987
. Wor Id . Series ~ the Twin Cities Marathon, the 1985 All-S tar Baseb!'lll
Game, Grandma's Marathon, the USA Cup and Women's North American Cup
(soccer). The Twin Cities look forward to hosting' the 1990 u. S.
Olympic Festival, the 1988 U. S. National Weightlifting Championship
(men's and women's) and the following NCAA championships: Women's
Volleyball (1988), Hockey (1989) and Men's Basketball Final Four
(1992) .
Enthusiasm for amateur sport is ongoing as the Twin Cities pursue
other major sport events including the 1994 World Cup soccer
tournament (we are a designated U. S. site), the 1989 U. S. National
Karate Championship, and others.
6.
A Track Record of Olympic Bidding
The importance of the Olympic Games to the people of Minnesota can be
measured by ,the state's previous Olympic bids--all of them strong:
1932 - Minneapolis and Duluth present a joint bid for the Winter
Games (before alpine skiing is designated an Olympic sport.)
1945 - During Minneapolis' bid for the 1948 Games, U. S. Olympic
Committee President Avery Brundage c"'allsMinneapolis "the
strongest bid of any American city." . He praises Minneapolis
for the quality and number of its sports facilities and its
potential to host the Olympics with little renovation or
construction of new venues.
.
1948 - Minneapolis bids against London.
1950 - Minneapolis ties with Los Angeles for second place.
14
1956
and
1960
Minneapolis bids again
.
I
I
!
In each of its bid~
community leaders. \
Minneapolis receives the wholehearted support of
7. Host to the.l990 u.ls. Olympic Festival
I
I
The Twin Cities ofiMinneapolis-Saint Paul joined forces to bid for
the 1990 U. S. OlYmPic Festival. The result: a winning bid and a
triumph for Minne$otans dedicated to the advancement of amateur
I
sport. i
G. TRANSPORTATION
1. Air
,
Because of the shott flight times between Minneapolis-Saint Paul and
other cities in the northern hemisphere, Minnesota has been described
as the "North Coast \ of America." Flights over the polar region are
convenient and fastl
i
Located in nearly the geographic center of North America, the major
market for the OltmPics, no city is more centrally located than
Minneapolis-Saint P ul. Most major North American cities are within
four hours by air.
.
The Minneapolis-Sai Paul International Airport has the capabilities
to serve the infl of people arriving for the Olympics. Only 38
percent of the air orts' daily lift capacity of 62,270 is currently
being used. Cust ms facilities now process over 400 passengers per
hour, and this callaCity will be increased to 1,200 per hour with a
new expansion now underway. International guests will also be
processed at other ports, such as JFK, as they enter the country.
Almost all major ca riers service the Twin Cities.
2. Land
Many major pOPUlat~on areas are within easy driving distance of the
Twin Cities. More than 28 million people from the U. S. and Canada
can reach Minneapo is-Saint Paul within an eight-hour drive. Most
portions of the eas ern United States and Canada are within a two-day
(I6-hour) drive. I
I
I
I
The Twin Cites a1e also well-connected by tail (Amtrak) and bus
(Greyhound, Jeffersln and Trailways).
Once here,visito~s will find a highway system that is one of the
most effective in Ithe country. Numerous limited access freeways
radiate from the downtowns and Interstates 694/494 encircle the
built-up area. A good overall measure of efficiency is rush-hour
.
15
.
.
.
congestion. Compared to many other cities our size the Twin Cities
virtually has no significant rush hour congestion. The planned light
rail transit system, to be jn place for the 1996 Games, will further
enhance the existing system. Currently over 1,000 buses provide
efficient transportation for 73 million passengers a year.
3.
Duluth
Duluth International Airport is located 9.7 km (6 mi.) from downtown.
Carriers that service this first class airport offer continuous,
frequent service to and from the Twin Cities and to many other
cities. Duluth has the longest runway in the state and recently
welcomed the British Airways Supersonic Concord.
H. A PARTNER WITH THE WORLD
The Twin Cities is an international center for trade and commerce,
education, and tourism. The recent opening of the Minnesota World Trade
Center in Saint Paul enhances the level of our existing international
relationships.
1.
Headquarters for 91 Multinational Corporations
A total of 91 Twin Cities corporations, including all of Minnesota's
Fortune 500 companies, operate in more than 70 countries worldwide.
There are also many businesses organized to fulfill specific
requirements:
o More 'than 40 local companies offer services from technical
translations to overseas public relations.
o Ninety local organizations offer international finance and legal
services, ranging from international banking and accounting to
international law.
o Duluth, Minnesota is the world's largest inland port, .linked by
the Great Lakes and the St. Lawrence Seaway to the Atlantic
Ocean. _Over 100 Minnesota companies offer shipping services.
o Twenty-four consulates represent their country's commercial
interests and offer assistance to visiting and resident citizens.
2. Ninth Largest Foreign Student Enrollment at University of Minnesota
Students from 116 countries are enrolled at the University of
Minnesota. The language bank at the Qpiversity can provide
translating and interpreting services for more than 60 languages.
16
1. A DIVERSE ECONOMY MEANS A STABLE ECONOMY
Minnesota's economy is a microcosm of the U. S. economy, with almost
every major national corporation represented here. Not reliant on any
single industry, Minnesota enjoys a stable economy, high employment rates
and a trade surplus.
i
Sixteen Fortune 500 comp~ies are headquartered here. Thirty companies
gross $1 billion or mor annually. For a metropolitan area this size,
there should be just 6! In addition, the Twin Cities is a branch
location for more than 3~000 other U. S. firms with major facilities held
by such giants as IBM, Vnisys, Ford Motor Company, Boise Cascade, FMC
Corporation and Prudenti~l Insurance.
.
i
Minnesota is third inl the nation in sales of electronic computer
equipment, and the world leader in bio-medical engineering. The high
tech expertise of loc~l companies could contribute greatly to the
efficient operations of the Games.
i
J. WORLD-RENOWNED FOR HEALTa CARE
Minnesota's pre-eminence in the medical field has been led for a century
by the University of Minnesota and the Mayo Clinic in Rochester. The
state has emerged as a w~rld leader in the areas of:
o medical education and research
o hospital and clinical care
o health care delivery systems
o . development of new m ical technologies
o financial investment in health care innovations
.
The Department of Su
School is the largest i
Transplant Unit at the University Medical
world.
1.
Hospitals I
There are 36 hospitals within the metro area with a total of almost
9,000 staffed be Twenty-eight of the hospitals have intensive
care/critical care units; eleven have specialized rehabilitation
units; ten have elipads. There are four helicopter evacuation
services in the sta e.
Four main
hospitals:
i
hospital,
I
i
I
have been identified as possible primary service
o The University o~ Minnesota Hospital
o Abbott-Northwest1rn Hospital
o United Hospital d
o .North Memorial H ,spital
and CIinic
.
17
.
.
.
2. Health Care: Minnesota's Number One Industry
Minnesota's $7 billion health care industry employs more than any
other industry in the stat(~. Here can be found the hig-he:,.; t
concentration in the worl"d of health-related organizations and firms.
K.
GREAT WEATHER, GREAT AIR
Minnesota has a reputation for our winter. But the s~ason that should
gain fame is our glorious summer. Mild and temperate, the average
temperature during July and August is 22 degrees C (72 degrees F) with an
average high peaking at 28 degrees C (82 degrees F). With the onset of
summer, the prevailing wind direction changes from the northwest to the
southeast. The influx of warmer air from the Gulf of Mexico just reaches
Minnesota, giving us our comfortable summer climate.
July and August are our sunniest months. On average, there are 22
or partly cloudy days each month, with over 15 hours of daylight.
summer months are also our driest--only 8.9 cm (3.5 in.) of rain
monthly. August is the most calm, in the Twin Cities with a mean
speed of 14.8 km per hour (9.2 mph).
clear
Our
fall
wind
Minnesota also has great air. One of the 25 largest metropolitan areas
in the country, the Twin Cities' air quality ranks highest.
The average altitude of the Twin Cities is 183 m (600 ft.) above sea
level.
Due to, the ""lake effect," Duluth experiences a slightly cooler climate
than the Twin Cities. The average temperature in July and August is 17.8
degrees C (64 degrees F) with an average high of 24 degrees C (75 degrees
F). Winds in July and August are ideal for yachting. Almost 20 days
each month have clear or partly cloudy skies.
;:
18
L.
FINANCIAL
.
I
A summary of the budget ~or the 1996 Olympics follows:
i
R~Y~!!!!~ (in millions of 11987 dollars)
A. Cash
l.
2.
3.
Private sector ~onation
Local and state ]contributions
Federal governm~~t (primarily for
security)
Ticket and souv~nir sales, coin sales
and other i
Li cens ing/ supp lilers
TV/radio rights
4.
5.
6.
B. In-kind contributions
Reveques Total
BxPenses (in millions of 1987 dollars)
A.
Operating I
. -I
1. Food and housin~
(rental/construqtion financing)
2. Transportation, !conununications,
medical, securi~'y, promotion,
insurance, tick t services,
accreditation, wards,
specator servic s
3. Venues (rental) ]
4. Arts festival i
5. Administration/personnel
6. Contingency I
Capital Improvement~
(new contruction (0 ympic
Stadium) renovatio sand
temporary seating) I
!
Bxpe~ses Total
B.
I NET
BUDGBT
87-489
19
$ 10
o
20
280
150
275
-~Q
$765
$105
.
258
25
10
135
70
137
$740
$<25
.
.
SAMPLE LETTERS .
AND
. RESOLUTIONS OF SUPPORT
.
.
.
.
Sample letter of support from Minnesota Olympians
Date
Mr. Roger Parkinson
Committee for the Twin Cities Olympic Bid
Star Tribune Newspaper of the Twin Cities
425 Portland Avenue
Minneapolis, MN 55488
Dear Mr. Parkinson:
As a former Olympic athlete and resident of Minnesota, I am writing to express
my enthusiastic support for the Minneapolis/Saint Paul bid to host the 1996
Summer Olympic Games.
The Twin Cities are fortunate to have an abundance of superb, athletic
facilities, a beautiful summer climate, and experienced staff to enable us to
host an event of this size.
I know that Minnesotans are warm, hospitable and
enthusiastic in their support of amateur athletic events.
As a Minnesotan and from my personal knowledge of the Olympic' Games, I am
confident of our ability and spirit to host a successful Olympic event for the
athletes,.coaches, staff, and visitors.
Thank you for sharing the information on your bid effort with me.
I would
welcome the opportunity to work with you and your committee as you continue in
this bid effort.
Sincerely,
"
-----------------------------------
(include Olympic sport and year(s) you competed)
88-68
SAMPLE LE~TER OF SUPPORT .FROM SPORT ADVISORS
Date
I
1
1
Cit~es
of the
Mr. Roger Parkinson
Committee for the Twin
Star Tribune Newspaper
425 Portland Avenue
Minneapolis, MN 55488
Olympic Bid
Twin Cities
Dear Mr. Parkinson:
On behalf of the Minnesota -- sports association--, I am writing to express'
our enthusiastic support for the Minneapolis Saint Paul bid to host the Games
of the XXVIth Olympiad.
I have extensively revieWed the bid book, "Twin Cities/1996."
I am very
impressed to see that you have incorporated the concerns of the Minnesota
sports association-- into your selection of a competition venue for --sport--.
The bid book's careful attention to the special needs of --sport athletes--
assures us of your sincer~ desire to see that the 1996 Games honor the best
I
interests of the competinglathl~te.
We look forward to workin~ with you on the 1990 Twin Cities Olympic Festival
and lending our full support to your efforts to host the 1996 Olympic Games in
the Twin Cities.
Sincerely,
Name
88-96
.
.
.
.
.
.
Sample Letter of Support from Mayors
Date
Mr. Roger Parkinson
Committee for the Twin Cities Olympic Bid
Star Tribune Newspaper of the Twin Cities
425 Portland Avenue
Minneapolis, MN 55488
Dear Mr. Parkinson:
As
Mayor
of
wri ting
I
to
our
community's
am
express
---------------,
enthusiastic support for the Minneapolis/Saint Paul bid to'host the Games of
the XXVlth Olympiad.
We agree with the Bid Committee's statement that "we are ready" to host a
successful Summer. Olympics in the Twin Cities.
The bid book illustrates a
sincere desire to see that the 1996 Games honor the best interests of the
competing athletes.
I can assure you that we will do all that 'we can to
demonstrate our hospitality to the athletes, coaches, staff, and visitors.
I look forward to working with you as you continue ih this bid effort.
Sincerely,
Mayor _________~___
88-69
SAMPLE INDIVIDUAL LETTER OF SUPPORT
Date
Mr. Roger Parkinson, Chai~an
Committee for the Twin Cities Olympic Bid
Star Tribune Newspaper of,the Twin Cities
425 Portland Avenue
Minneapolis, MN 55488
Dear Mr. Parkinson:
I ,enthusiastically suppor~ you and your committee in your efforts to bring the
Games of the XXVlth Olympiad to our area.
Our climate, facilities, housing
capacity, corporate stre~gth, communitywide support for amateur athletics and
considered in the selecti9n process.
I .
\
I
.Please convey my support ~or
I
\
experience
in
hosting
88-97
should be
Dj.aj 0 r
. !
events are positive
that
factors
the bid efforts to the U~
S. Olympic Committee.
Sincerely,
Name
e.
e
e
.
.,
.
SAMPLE RESOLUTION
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ___________________SUPPORTING
THE CONCEPT OF MINNEAPOLIS-SAINT PAUL HOSTING THE 1996 SUMMER OLYMPICS.
WHEREAS, the Secretary General of the United States Olympic Committee has
initiated an inquiry to determine whether the cities of Minneapolis-Saint Paul
are interested in hosting the 1996 Summer Olympics; and
WHEREAS, the mayors of Minneapolis-Saint Paul have asked area municipalities
for their general support to the concept of hosting the 1996 Summer Olympic
Games; and
WHEREAS,
climate well
the Minneapolis-Saint Paul Metro Area enjoys a temporate summer
suited to international athletic competitions and now possesses
numerous excellent athletic facilities suitable as Olympic venues; and
WHEREAS, the Minneapolis-Saint Paul Met~o Area has the capacity to 'provide
the necessary accommodations to support visiting athletes and spectators; and
WHEREAS, the 1996 Summer Olympic Games would bring significant revenues to
the Minneapolis-Saint Paul Metro Area as well as extensive international -
recognition, without expending taxpayer funds;
NOW, THEREFORE, BET IT RESOLVED that the City of ____~____________________,
State of Minnesota, hereby express to the Mayors of Minneapolis and Saint Paul
its firm support for the concept of hosting the Summer~Olympic Games in 1996.
PASSED, APPROVED, AND ADOPTED by the City Council of the City of
__________________ at a regular meeting held on _____________, 1988 'by the
following vote:
.
.
.
"
REPORT OF THE
STATE AUDITOR of MINNESOTA
MINNESOTA STATE & LOCAL
BONDED INDEBTEDNESS
MARCH 1988
ARNE H. CARLSON
State Auditor
St. Paul, Minnesota
.
.
.
STATE OF MINNESOTA
OFFICE OF THE STATE AUDITOR
SUITE 400
525 PARK STREET
SAINT PAUL 55103
ARNE H. CARLSON
STATE AUDITOR
296-2551
PREFACE AND RECOMMENDATIONS
Minnesotans elect government officials to make decisions on their behalf.
Of all the decisions facing Minnesota1s elected officials, few carry the 10ng-
tenm implications of a decision to borrow. Consider a decision to bond. Once
the decision is made and the bonded project is completed, the impact is irrever-
sible. Future elected officials and taxpayers are responsible for.the debt.
Based on this concern, it may be well to review the Governor's $422 million
1988 bonding bill.
The package includes $336 million which the Governor says is necessary to
make up for "years of neglect" at Minnesota colleges and universities. I do not
deny we need many of these educational initiatives. But I do have a concern
about what it says for the state's long-range capital budget planning process; a
very real concern that there is no such process, at least not an effective one.
Specifically, the Governor1s 1988 capital budget proposal includes:
- 1 -
AN EQUAL OPPORTUNITY EMPLOYER
GOVERNOR'S 1988 BONDING PROPOSAL
(in thousands of dollars)
Recommended 1987
HIGHER EDUCATION ;
AVTI's .1'
Community College
Higher Education Coor. I Board
University of Minnesot~
State University System
Subtotal
$ 23,942.9
24,790.7
55,189.7
38,497.6
$142,420.9
14,196.7
3,509.8
3,533.8
STATE AGENCIES
Administration
Corrections i
Trade and Econ. Development
Health
Human Services
IRRRB
Mil i tary Affairs
Natural Resources
Subtota 1
$ 21,240.3
$163,661.2
GRAND TOTAL
----------
----------
Not Recommended 1987
.
$ 61,964.6
37,487.2
600.0
74,930.6
19,011.0
$193,993.4
41,160.1
14,772.8
1,273.1
175.0
4,000.0
2,900.0
150.0
$ 64,431.0
$258,424.4
----------
----------
.
I believe analysis Qf these figures reveals a serious lack of foresight.
i
New projects and cojstruction funds account for 61 cents of every dollar in
the proposal. Even for,colleges and universities, 58 cents on the dollar
reflect new initiativesland construction funds. These are funds the Governor
I
did not recommend in hi $657 million bonding bill submitted just one year ago.
Why are we only now recognizing these needs when many of the projects are to
correct years of negl ec! ?
I contend that the ~tate of Minnesota's current bonding planning process is
inherently f1:awed. The] process does not lend itself to long-term planning. As
a matter of fact, the s!ystem is so overly weighted to short-term political sur-
vival that it may well ijeopardize our long-term financial health.
- 2 -
.
.
.
..
.
The State of Minnesota must establish a long range capital budget planning
process. Many of our local governments do this now; there is no reason for
State government to be so outdated. We can no longer afford a system that makes
the incurrence af debt an appetizer for a re-election campaign--be it on behalf
af a Governor or the Legislature.
As a fonner member of the Minneapolis City Council, I came to respect the
Capital Long-Range Improvements Committee (CLIC). Established in 1954, the CLIC
is a citizens' advisory group which assists the mayor and city council in devel-
oping 10ng-rang,e capital improvement policy and programming. Reviewed
annually, the committee's program contains first year projects which it recom-
mends for city funding, and future projects tentatively recommended for funding
in each of the four ensuing years.
Although ClIC's input is only advisory in nature, the concept does require
the Minneapo1js City Council and Mayor to take a long range view of capital
budgeting. The CLIC process has been relatively successful in diffusing short-
tenn pol itics and has been instrumental in protecting the City. s AAA bond rating.
In order to establish a long-range capital budgeting process at the state
level, I recamnend the Legislature reinstate the Legislative Building
Commission (lBC) which existed between 1955 and 1973. The LBC (whose membership
included five Hause and five Senate members) prepared capital budgets for recom-
mendation to tme Legislature during these years. At the same time, the
Commission reviewed and reported on the state's long-range capital needs.
Interesting:ly, during its entire existence, the biennial capital budgets
recommended by the Legislative Building Commission were adopted by the incum-
bent governor. In other words, the Legislature initiated bonding policy and
planning.
The Commission.s advantages over the current capital budgeting process are
apparent. Most pronounced would be-the Commission's ability to meet year-round
- 3 -
to review proposed bonding policy and projects. This would include actual
on-site visits to state institutions to get a first hand look at building needs,
both of an immediate nature and those which will require attention ten years
down the road. The commi$sion could then share its findings with the entire
Legislature in the form of a recommended two-year capital bonding proposal, and
,
a long-range report on th$ identifiable bonding needs of the State of Minnesota
!
for the ensuing ten years~ Hopefully, our capital needs would be identified in
a timely manner and we would not be faced with tOday's "years of neglect"
scenario. !
A second concern I hate is that Minnesota's intergovernmental system does
not adequately consider t~e stacking effect of bonded ind~btedness.
Consider a family living in Any town, Minnesota. This family must contrib-
ute, through the taxes an~ user fees it pays, to the debt servicing costs of
i
I
the combined bonding deci~ions of city, county, school district 9nd special pur-
I
pose governmental entitie~ serving its locality. State level bonded indebted-
~ :
ness costs are added to t~ese local costs.
Individually, any of ~hese governmental entities' bonded indebtedness levels
and associated taxpayers' I cost may seem minor and insignificant. On a cumula-
tive level, however, the ~ombined debt service costs may be anything but
i
insignificant. The probl~m is that our current system allows individual deter-
i
mination by each entity of bonding levels and costs. The process does not con-
sider the cummulative ;mp~ct.
The Legislative Build~ng Commission would fill this void. Its respon-
sibilities would include legislative oversight and constant monitoring of all
governmental bonding throighout Minnesota. I maintain that such oversight and
monitoring are critical if we hope to prevent the stacking effect from finan-
cially crippling future t~xpayers.
- 4 -
.
.
.
As to cOl1lllission membership, I recomnend that, in addition to Legislators,
~ members include the Governor, State Auditor, State Treasurer, State Finance
Comnissioner. local government officials, and knowledgeable citizens with exper-
tise in capiti:l planning and debt policy.
Local gove'rnments also need to review their decision making processes for
extending their bonding authority and planning future capital project needs.
One area of particular concern is the substantial use of Tax Increment Financing
(TIF), and particularly the extension of local government's general obligation
bonding authority, for private development projects. Caution is certainly
warranted in tilts area, for if these projects were to default, the taxpayers
would be required to payoff the bonds. Also of concern ..is the use of lease
purchase agreements when the purpose is to avoid going to the voters to receive
bonding approval.
I trust that the information contained in this report will be useful to
~ tOday's poli~akers, and will assist them in making informed decisions on
., bonding requests. I hope it will help us realize the need for a long-term focus
on the financial implications of today's borrowing decisions. The fact is that
the more debt we create today, the less financial flexibility we will have
tomorrow. By this I mean, if a governmental entity currently spends four per-
cent of its current revenue on debt, that means that it has 96 cents of each
dollar available for other programs and services. .If that figure increases to
eight percent. then the remaining available funding level is reduced to 92 cents
on the dollar. On that basis, we can begin to understand how debt competes with
other gover~ntal programs and services, both today and in the future. I argue
that the higher the debt load, the higher taxes will go in order to accomnodate
that increase.
The highltghts of this report are:
~
- 5 -
.~..,
""\
On December 31, 1975, the total bonded indebtedness of Minnesota state
and local government was $4.3 billion. By 1986, the total was $9.1
billion, an increase of $4.8 billion, or more than double what it was .
at the beginningiof this eleven-year period.
Total bonded ind$btedness per capita increased from $1,088 in December
1975 to $2,154 bJ December 1986, or $1,066 per capita. For a family of
four, this total~ a $4,264 increase.
The shift in totAl bonded indebtedness share among the classes of
governmental units has been substantial, with State Government's
share nearly dou~ling over the last eleven years, going from 19.7 per-
cent to 36.9 per~ent of the total.
One final thought. Ilam not naive enough to expect that politics will be
divorced from bonding decisions and the creation of projects that are desired by
I
the "home folks". But I ~o think we have an obligation to create an orderly
process that places some very specific limits on debt.
1
There will certainly ~e yet unforeseen demands on Minnesota's limited finan-
!
cial resources, demands w~iCh will be of critical importance to our state's
citizens. Our challenge ;s to make sure we do not allow today's seemingly
endless appetite for debt to strangle our future options. I can think of no
.
worse legacy to leave our children and grandchildren.
~~ \~~~.
ARNE H. CARLSON
State Auditor
March, 1988
.
- 6 -
MINNESOTA STATE AND LOCAL BONDED INDEBTEDNESS (1)
.
The total principal amount of bonded indebtedness of Minnesota state and
local governments more than doubled during the eleven year period December 31,
1975 through December 31, 1986. (2)
MINNESOTA STATE & LOCAL
TOTAL BONDED INDEBTEDNESS
(Principal Only).
5iillons
$101
I
$9.01!i,188.000
$81
!
December 31. 1975
Decernoer 31, 1986
.
The period hegan with bonded indebtedness at $4.3 billion. By the end of
the 1986 calendar year, total bonded indebtedness stood at $9.1 billion. The
dollar increase was $4.8 billion over the eleven years. The percentage increase
was 113%. Inflation over the same eleven-year time period as measured by the
Consumer Price Index was 96% according to the U.S. Bureau of Labor Statistics.
(1) The bonded indebtedness figures presented in this study are for principal
only. Actual bonded indebtedness also includes the interest that must be
paid to rettre the bonds. See the IIFinal Observationll section, page 22, for
additional discussion on this clarification.
(2) December 31, 1986, data is used for this section because it is the latest
date for vMch bonded indebtedness figures are available for Minnesota local
governments.
..;. 7 -
.
The division of governmental bonded indebtedness by type of unit is shown in
TABLE 1
MINNESOTA STATE AND LOCAL BONDED INDEBTEDNESS
(Principal Only)
.
Tabl e 1.
December 31, December 31, Do 11 ar Percent
19861 1975 Difference Change
I
State $ 3,349,Ot6,000 $ 839,274,000 $ 2,509,802,000 + 299 1-
University i
of Minn. 455,1tO,000 34,879,000 420,251,000 +1205
School
Districts 799,735,000 1,208,298,000 - 408,563,000 - 34
CHi es 3,429,2~3,000 1,423,768,000 2,005,515,000 + 141
Counties 311,8~4,OOO 159,864,000 151,950,000 + 95
Towns 23,8$3,000 9,306,000 14,577,000 + 157
Special I,
Districts 706,2f7,000 594,906,000 111,361,000 + 19
i $ 4,270,295,000 $ 4,804,893,000
Total $ 9,075,1~8,000 113 %
I
i
Source: Department of Finance; Stat~ Agencies; State Auditor's Office
I
\
I
Analysis of these num~ers yields several significant observations. Primary
ls the dominance of the s~ate of Minnesota and city governments relative to the .
. i
- dollar growth of bonded i~debtedness in our state. The State of Minnesota
!
bonded indebtedness incretsed by $2.5 billion from year-end 1975 to year-end
I
1986. This represented a\nearlY 300% increase. For cities, total indebtedness
increased by $2 billion, ~r 141%. Taken together, the state and cities bonded
i
indebtedness increased by!over $4.5 billion over the 11 year period.
i
"
In percentage tenns, 'he University of Minnesota had the greatest growth in
I
bonded indebtedness from ~ear-end 1975 through 1986. Over the period, the
University's outstanding ~onds grew from just under $35 million to $455 million.
The increase was $420 miliion, or 1,205 percent. It should be noted that the
,
University retired a sUbsJantial amount of bonds in recent months. During
i
the first fifteen months ince year-end 1986, for example, nearly $157 million
in bonds has been retired
leaving an outstanding balance of $298.5 million as
.
of Aprill, 1988.
- 8 -
H
..
e
e.
e:,'
For Minnesota school districts, the period saw a decrease in bonded indebt-
edness. The drop from 1975 was $409 million, or 34% less at the end of 1986.
For counties, the 11 year bonded indebtedness increase was $152 million, or 95%.
Towns' indebtedness grew by 157 percent, or $14.6 million. The growth in special
districts' bonded indebtedness was $111 million, up 18.7%.
The second major observation is the shift in the proportionate share of
bonded indebtedness in Minnesota among the various governmental units.
MINNESOTA STATE & LOCAL
TOTAL BONDED INDEBTEDNESS
ClUes 33.3Cf.
Co:."tles 3,'?'%
Cecember 31. "1975
$.1.,270,295,000
Towns 0.3%
:iecemoe: 31, 1986
59;C75,188,'OOO
At the end of 1986, the State of Minnesota bonded indebtedness represented
36.9% of the total outstanding bonded indebtedness in Minnesota. By contrast,
at the year-end 1975, the state's proportionate share of the total was 19.7%.
The University of Minnesota's proportional share increased from $0.8% to 5%
at the end of 1986.
For cities, the share of total bonded indebtedness grew from 33.3% to 37.8%
during the period. Reflecting the school districts' overall reduction in
, outstanding bonded indebtedness, their shares decreased from 28.3% of the
statewide total in 1975 to 8.8% in 1986. The counties' and towns' shares remained
virtually the same during the period, while special districts dropped from 13.9%
to 7.8%.
- 9 -
"
Per capita bonded indebtedness increased from $1,088 to $2,154 between the
beginning of 1976 and the end of 1986. This represented a $1,066 increase in
bonded indebtedness for eV1ry man, woman and child in Minnesota.
I
I
STATE OF MINNESOTA i
.
The State of Minnesotals bonded indebtedness consists of two principal types:
general obligation bonds a/lid bonds issued by authorized state agencies. The
basic difference between t~ese bonding instruments is that general obligation
I
bonds are backed by the fUll faith and credit of the State. That is to say,
their repayment is guarant ed by the State of Minnesota.
State agency bonds are not backed by the full faith and credit of the State.
They do not represent a le~allY binding obligation of the'~tate of Minnesota,
i
and thus their repayment i not guaranteed by the State. Rather, these bonds
are typically retired by t e revenue stream generated by the purpose for which
the bonds were originally ssued (housing, college dorms, etc.). If these reve-
nue. streams should prove itsufflCient to retire the bonds, the State has no .
--legal obligation to prOVidj the necessary revenue for their repayment.
Table 3 presents the PfinciPal amount of outstanding general obligation
bonded indebtedness that rtmained for the State of Minnesota on December 31,
1975. Also shown is the afount that will be outstanding on April 1, 1988. Over
I
the period, the amount of tutstanding general obligation bonds issued by the
State of Minnesota will mote than double, going from $624,832,000 at year's
start in 1976 to $1,297,47ID,000 on April 1, 1988.
I
Of course, the outstan~ing amount of general obligation bonded indebtedness
of the State of Minnesota is only part of the story. An equally important fac-
tor is the amount of genertl obligation indebtedness which the State Legislature
I
has authorized, but has not been issued. Of the $470 million in general obliga-
I
- 10 -
.
~
.
.
.
Category
1
2
3
4
5
TABLE 3
STATE OF MINNESOTA
OUTSTANDING GENERAL OBLIGATION BONDED INDEBTEDNESS
(Principal Only)
Type
Bunding
Voyageurs National Park
Pollution Control
Vietnam Veterans Bonus
Natural Resources
Parks and Recreation
Transportation
Zoo}ogical Garden
Waste Management
Refundi ng Bonds
Exchange Bonds
Faa:ily Farm Securi ty
Reinvest in Minnesota
Rural Finance Authority
ScUol Loan
ScUol Loan Refunding
'State Universities
Sd!lcml Energy Bu i1 ding
G~ and Fish Building
Zoologi ca 1 Gardens
Aenrnautics
Trunk Highway Bonds
Trunk Highway Refunding
Stat.e Cigarette Tax Bonds
Building
1ransportation
Reinvest in Minnesota
State Sports and Health Club
Tax. Bonds
Butldi ng
TOT AL OUrST A.LNG
Percentage increase
Source:
Minnesota Department of Finance
December 31,
1975
$ 361,517,000
4,070,000
36,250,000
54,000,000
April 1,
1988
$ 448,998,000
69,155,000
18,000,000
9,000,000
27,000,000
65,508,000
11 ,800 ,000
10,813,000
415,632,000
6,289,000
'16,000,000
16,000,000
2,500,000
8,020,000
14,164,000
12,415,000
13,900,000
506,000
37,475,000
18,565,000
23,835,000
3,330,000
85,790,000
39,145,000
42,625,000
32,000,000
3,000,000
10,000,000
5,000,000
$ 624,832,000
$ 1,297,470,000
108 %
- 11 -
bonding projects authorized by the 1987 Legislature, for example, over $400
million remains to be issu~d.
The dollar amount of slate General Obligation bonds authorized but not
.
issued was $130,720,000 oni December 31, 1975. As of April 1, 1988, this amount
has grown to $584,468,000.1 The increase is $453,748,000, or 347 percent.
i TABLE 4
! STATE OF MINNESOTA
GENERAL OeLIGATION BONDS AUTHORIZED, UNISSUED
I (Principal Only)
I
]
Remaining Authorization
December 31, Apri 1 1,
1975 1988
Type of Issue
School Loans (1969) $ 9,800,000
Building (1971) 8,781,000
Building (1971) 27,299,000
Building (1975) 20,000,000
Building (1975) 19,300,000
Pollution Control (1971, 1~73, 1975) 44,000,000
Zoological Garden (1973) 1,540,000
.Municipal Aid (1971) $ 4,330,000
Building (1979) 129,000 .
School Loans (1980) 4,975,000
Waste Management (1980) i 2,500,000
Building (1981) i 37,975,000
..School Energy Building (19~3) 7,000,000
Transportation (1984) i 7,000,000
Building (1985) 46,365,000
Transportation (1985) 2,035,000
Waste Management (1985) 6,600,000
Family Fanm Security (1986~ 4,000,000
Rural Finance Authority (le86) 47,500,000
Building (1987) . 328,077,000
Transportation (1987) 5,800,000
Waste Management (1987) 4,000,000
Pollution Control ( 198?) i 66,747,000
Reinvest in Minnesota (198V) 9,000,000
Building (198?) 435,000
TOTAL AUTHORIZED, UNISSUED] $ 130,720,000 $ 584,468,000
Percentage increase I 374 %
Source: Minnesota Departm~nt of Finance
- .
- 12 -
.
.-
,.-.,.c'" ..-...-;
Taken together, the State of Minnesota total General Obligation bonded
. indebtedness, both issued and unissued, grew from $755,552,000 on December 31,
1975, to $1,881,938,000 on April 1, 1988, or nearly two and one half times. On
a per capita basis, the increase is from $192 to $443.
STATE OF MINNESOTA
General Obligation Bonded Indebtedness
Issued and Unissued
Millions
$2,000 I
$1,500
$1,000
$500
$0
December 31, 1975
April 1, 1988
The other major portion of State of Minnesota bonded indebtedness is state
. agency bonded indebtedness, detailed in Table 5.
TABLE 5
STATE OF MINNESOTA
OUTSTANDING STATE AGENCY BONDED INDEBTEDNESS
(Principal Only)
State Agency
December 31,
1975
Minnesota Housing Finance Authority $ 102,115,000
Minnesota Higher Education Coordinating
Board 48,720,000
Minnesota Higher Education Facilities
Authority 23,685,000
Minnesota State University Board 38,427,000
Minnesota State Armory Building
Commission 1,455,000
Minnesota Public Facilities Authority
Minnesota Energy and Economic
Development Authority
Minnesota Agricultural and Economic
Development Board
TOTAL OUTSTANDING $ 214,442,000
. Percentage increase
Source: The State Agencies; Minnesota Department of Finance
- 13 -
April 1,
1988
$ 1,531,567,000
315,100,000
90,975,000
27,522,000
4,072,000
87,285,000
32,655,000
6,340,000
$ 2,095,516,000
877 %
On December 31, 1975, the outstanding bonded indebtedness of Minnesota State
Agencies was $214 million. Ian April 1, 1988, the outstanding bonds will total
i
nearly $2.1 billion. The tQtal increase over this time period is just under
$1.9 bi 11 ion, or 877 percent. A major porti on of the increase is for programs
.
supported by the Minnesota ~ousing Finance Agency which alone grew by over $1.4
I
billion.
UNIVERSITY OF MINNESOTA
Between December 31, 1975, and April 1, 1988, the University of Minnesota
outstanding bonded indebtedness grew by $263.6 million. This represents a 756
percent increase.
UNIVERSITY OF MINNESOTA
Outstanding Bonded Indebtedness
(Principal Only)
Millions'
$350
$298,530,000
.
$100
$300
$250
$200
$150
$50
Deti:emoer 31, 1975 April 1, 1988
As discussed earlier, t~e University substantially reduced its bonded
indebtedness in recent mont~s. During the first 15 months since year-end
$0
1986,
for example, just under $151 million of bonds has been retired. This will leave
a $298.5 million bond balan4e on April 1, 1988, compared to the $455 millian
outstanding on December 31, \1986.
SCHOOL DISTRICTS
I
The total bonded indebtedness of Minnesota School Districts has actually
.
decreased since the mid-197~S.
I
I
I
I
- 14 -
.
MINNESOTA SCHOOL DISTRICTS
Outstanding Bonded Indebtedness ..
(Principal Only)
MillIons
$1.400
$~.2oo
$1,000
$800
$800
$400
$200
$)
DecerTIoer 31. 1975
. All General Obilgation Bends
Jl.Ine 30. 1987
On June 30, 1987, Minnesota School Districts had a total outstanding bonded
indebtedness of $764 million. This was a decrease of more than $444 million
since December 31, 1975, when the school districts had a combined bonded indebt-
'ednes$ of $1.2 bi 11ion. The decrease was nearly 37 percent. On a per capita
. basis, the decrease was from $308 to $181.
One item of note is that even though Minnesota school districts witnessed a
large decrease in the level of bonded indebtedness since the mid-1970s, their
.
total bonded indebtedness increased last year. Although it is too early to
conclude that this increase is a trend, it may well be when one considers that
there will be an estimated 50,000 more students in our local schools between now
and 1995. Also, since many of these new students will be concentrated in select
districts and not proportionately dispersed throughout the state, classroom
capacities in the impacted districts may prove inadequate and this could require
additional building beyond normal replacement for these districts.
- 15 -
CITIES*
The outstanding bonded nndebtedness of Minnesota cities grew from
I
i
$1.4 billion to $3.4 billior between the end of 1975 and 1986. The dollar
I
amount of increase in citie6 bonded indebtedness over these eleven years was
,
.
over $2 billion. The percentage increase was 141 percent.
General Obligation
Special Assessment
Revenue
Other
TOTAL BONDED INDEBTEDNESS ~UTSTANDING
i TABLE 7
I MINNESOTA CITIES
OUl1lSTANDING BONDED INDEBTEDNESS (1)
(Principal Only)
I December 31,
I 1975
!
$
442,043,000
718,693,000
245,920,000
17,112,000
December 31,
1986
$ 1,498,351,000(2)
1,137,998,000
677,586,000(3)
115,348,000
$ 3,429,283,000
$ 1,423,768,000
PERCENTAGE INCREASE
141 %
I
(1) Does not include Munic~pal Industrial Revenue Bonds
(2) Includes:
General
General
General
.
Ob 1 i ga t ion !
Obligation R~venue
Obligation TiX Increment
$ 495,780,000
410,004,000
592,567,000
$ 1,498,351,000
$ 450,661,000
226,925,000
$ 677,586,000
(3) Includes: i
Revenue Regular I
Revenue Tax Increme1t
I
Source: Minnesota State Auditor's Office
Minnesota cities bonded indebtedness has experienced rapid growth in recent
years. In just the two y~ars between the end of 1984 and 1986, total indebted-
I
* The bonded indebtedness jfigures for Minnesota cities presented in this study
do not include Municipal ~ndustrial Revenue Bonds.
I
I
- 16 -
.
.
ness for Minnesota cities grew by over $900 million, representing a 36 percent
increase. Of that total, Tax Increment Financing Bonds represented more than
half of the growth, increasing by $457 million, and more than doubling in these
two years alone. By comparison, cities' special assessment debt increased by
$35 million during these same two years.
The fact that cities' Tax Increment Financing bonding growth has been so
rapid in recent years meant that these instruments, both general obligation and
revenue, accounted for nearly one-fourth of all Minnesota cities' outstanding
bonded indebtedness at 1986 year end. At year-end 1984, just two year's prior,
the comparable figure was about 14%.
MINNESOTA CITIES
Outstanding Bonded Indebtedness
(Principal Only)
.
General Ollllgatlon 111.1"
G.O. R_nue 12.0"
R_nue 13.2"
G.O. Tax Ino,elllent 8.7.
G.O. Tax Inorement 17.3.
December 311 1984
December 31, 1986
Of particular note has been the growth of cities' general obligation Tax
Increment bonds. These bonds, which have the full faith and credit backing of
the issuing cities, more than doubled in amount between December 31, 1984, and
year-end 1986, going from $222 million to $593 million. In fact, the growth has
COUNT! ES
The outstanding bonded lindebtedness of Minnesota counties increased by
I
nearly $274 million betwee~ calendar year 1976 and 1985.
TABLE 8
i MINNESOTA COUNTIES
OU]STANDING BONDED INDEBTEDNESS
! (Principal Only)
.
Percentage increase
December 31, December 31,
1975 1985
$ 114,142,000 $ 359,195,000(1)
19,186,000 50,698,000
9,225,000 5,380,000
17,311,000 18,235,000
$ 159,864,000 $ 433,508,000
171 %
General Obligation
Special Assessment
Revenue
Other
Total Bonded Indebtedness Outstanding
, ,
(I) Includes:
General Obligation
General Obligation Revenue
$
$
234,278,000
124,917,000
359,195,000
.
1
I
I
Source: Minnesota State A~ditorls Office
On December 31, 1975, ~he combined county bonded indebtedness was
$159,864,000. Over the next ten years, this amount increased by 171% to
MINNESOTA COUNTIES
Ou~tanding Bonded Indebtedness
I (Principal Only)
!
Millions i
$500
December 31. 1975
I
i
December 31, 1985
.
- 18 -
.
.
.
$433.508.000 on December 31. 1985. The per capita increase in outstanding
county bonded indebtedness was from $41 to $103.
Preliminary information from Minnesota County Auditors for calendar year
1986 indicates that Minnesota counties outstanding bonds decreased by $121
million from their 1985 level. A major reason for this decrease was an action
by the Hennepin County Board to redeem $134 million in temporary General
Obligation bonds far construction of the county's new solid waste resource
recovery facility. Rather. the county issued $141 million of Refunding Revenue
Bonds to payoff the original temporary bonds. These Refunding bonds are
Industrial Revenue Bonds and do not constitute bonded indebtedness an the part
of the county.
TOWNS
Minnesota towns have historically util ized bonded indebtedness on a very
1 imi ted bas i s.
TABLE 9
MINNESOTA TOWNS
OUTSTANDING BONDED INDEBTEDNESS
(Principal Only)
December 31, December 31,
1975 1985
General Ob 1 i galion $ 5,140,000 $ 2,648,000
Special AssesSlRent 3,943,000 15,753,000
Other 223,000 71 ,000
Total Bonded IRaebtedness Outstanding $ 9,306,000 $ 18,472,000
Percentage increase
98 %
Source: State Auditor's Office
- 19 -
At the end of 1975, towns' outstanding bonded indebtedness was $9,306,000.
Ten years later, the amount of towns' outstanding bonds was $18,472,000. The
increase over the period was $9,166,000, or 98 percent.
.
MINNESOTA TOWNS
Ou~tanding Bonded Indebtedness
(Principal Only)
Millions
$20
$15
$18.412,000
$15
$10
pecember 31. 1975
,
Prel imi nary data from ICounty Auditors for towns outstanding bonded indebted-
ness at the end of calenddr year 1986 indicates that the total g~ew by $5.4
$J
Decemoer 31. 1985
miJlion during the year fnom the $18.5 million total outstanding at the end af
i
1985. This represents a ~early 30 percent increase and is substantial when you
i
consider that it is the eguivalent of more than half of the entire increase
during the previous ten y~ars combined.
I
I
One further item rela~ive to towns' bonded indebtedness is that only a few
I
I
towns have any bonded indebtedness--mainly those concentrated in more urbanized
I
areas. At the end of 1981, for example, only 43, or 2.4% of the Minnesota towns
had any bonded indebtedne~s. One town, White Bear Township in Ramsey County,
had bonded debt totaling ~1,338,046, or 61.4% of the towns' total bonded indebt-
I
I
.
, edness in the State.
.
- 20 -
. ~~
~~
~
.
.
.
SPECIAL DISTRICTS
In addition to general purpose governmental units having bonded indebtedness
authority in Minnesota, several special purpose districts also have legal
authority to bond.
TABLE 10
SPECIAL DISTRICTS
OUTSTANDING BONDED INDEBTEDNESS
(Principal Only)
December 31,
1975
$ 102,870,000
24,819,000
216,867,000
25,680,000
36,380,000
16,691,000
158,372,000
12,100,000
403,000
724,000
Airport Commissions
Hospital Districts
Housing & Redevelopment Authorities -
Housing
Port Authorities (1)
Regional Development Commissions
Recreation Authorities
Rural Water Systems
Sanitation Distri~ts
Soil and Water Conservation Districts
Transit Commissions
Housing and Redevelopment Authorities -
Urban Renewal
Watershed Districts
Total Outstanding Bonded Indebtedness $ 594,906,000
Percentage increase
(1) Does not include Industrial Revenue Bonds
(2) Of the Total Outstanding Indebtedness on June 30, 1985:
General Obl igation $ 346,663,000
General Obligation Revenue 134,410,000
Special Assessment 13,678,000
Revenue 7,401,000
Other 134,892,000
$ 637,044,000
Source: State Auditor1s Office
- 21 -
June 30,
1985
$ 118,195,000
28,034,000
130,748,000
16,165,000
30,700,000
53,035,000
6,556,000
228,989,000
16,140,000
3,555,000
4,927,000
$ 637,044,000(2)
7 %
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As this table shows, special districts as a group witnessed little growth in
their bonded indebtedness from the end of 1975 through June 30, 1985. In total, .
the aggregate outstanding indebtedness increased by $42,138,000, representing a
7 percent increase over the period.
SPECIAL DISTRICTS
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cputstanding Bonded Indebtedness
I (Principal Only)
Mlllllone
$700
~9<4.908.000
$100
$0
. December 31. 1975 June 30. 1985
. This office estim~tes that by the end' of calendar yea~ 1986, Special
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Districtsl. bonds outs~anding had increased by $17,223,000, to $654,267,000,
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"in the 1~ years since Ithe mid-year 1985 amount given above.
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FINAL OBSERVATIONS
Throughout this s~udy, reference has been made to the fact that the figures
listed are the princi~al amounts .Q.!!..!1 of outstanding bonded indebtedness of
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Minnesota1s state and Ilocal governments.
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This clarificatio~ is of utmost importance since, when a governmental unit
" issues a bond, it is in fact borrowing money similar to when a family borrows
to purchase a home or !buy a car. Upon executing the borrowing agreement, the
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borrower, whether the 19overnment or a private party, agrees to pay the lender
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not only the princiPall but interest as well.
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To appreciate this clarification's impact, consider the level of the
State of Minnesota's general obligation bonding. As of November 1987, for
example, the State had outstanding general obligation bonds totaling $1.3
billion in principal. What this figure does not reflect is the interest due
and payable to the lenders of this $1.3 billion. According to the Department of
Finance, that interest to maturity was $685 million. Thus, the true level of
general obligation indebtedness outstanding for the State of Minnesota was the
sum of the principal and interest payable, or $1.985 billion as of November
1987.
Data limitations do not allow for determining the true level of bonded
indebtedness by Minnesota state and local governments, t~ ~nclude interest as
well as principal. Most reporting and financial statements reflect only the
principal amount of outstanding bonds issued by the respective governmental
units. Hence, the true level can only be estimated. .
If we aSSl.Be that the total interest on Minnesota state and local bonded
indebtedness is the equivalent of 75 percent of the $9~1 billion principal
amount, for example, the estimated interest payable would be $6.8 billion.
Taken together, the total level of governmental bonded indebtedness in the State
would be $15.9 billion in principal and interest as of the end of 1986 calendar
year. This works out to about $3,775 for every man, woman and child living in
Minnesota.
Of course, these $15.9 billion and $3,775 figures are but estimates.
However, they present a much more accurate picture than Simply looking only at
the principal amount of Minnesota state and local bonded indebtedness indepen-
dent of interest repayment requirements.
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A second item that shou~d be kept in mind is that bonded indebtedness is
only one form of governmentl debt and thus should not be considered as an all-
inclusive reflection of gav~rnmental debt in Minnesota. Other forms of
governmental borrowing are rang and short-term instruments for which no bonds
are issued. The increasing~y popular use of lease-purchase agreements for
equipment and facilities is! another method. Incorporating the amounts of these
debt instruments is beyond ~he scope of this study. However, it can be said
with certainty that their incorporation would yield a substantially higher level
of true governmental debt ip Minnesota than that reflected in bonded indebted-
ness figures alone.
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