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2 <br /> The request for proposal asked for both bank qualified and non-bank qualified rates for terms of <br /> both 15 and 20 years. The County received proposals from six banks. After evaluating the <br /> financing proposals, staff determined the most advantageous way to proceed and achieve the <br /> lowest interest cost was to take the following steps: <br /> • Proceed with alternative financing for the Parks and Open Space and Affordable Housing <br /> projects rather than pursue General Obligation Financing. <br /> • Approve bank qualified rates for the tax exempt capital project financings for a 15 year <br /> term <br /> The savings for the County of borrowing at the bank qualified rates being recommended is <br /> $1,399,000 as compared to the lowest non-bank qualified rates proposed. The lowest rates for <br /> each financing alternative are shown below with the recommended alternative underlined in <br /> bold: <br /> 15 Yr 20 Yr 16 Mo 59 Mo 59 Mo <br /> Capital Capital Taxable Equip PI MS <br /> Rate Type Projects Projects <br /> Bank Qualified 3.60% 4.37% 3.050% 3.05% <br /> Non Bank Qualified 4.17% 4.87% 5.26% 2.975% 2.975% <br /> Staff and Bond Counsel recommend approval to proceed with the following financing proposal <br /> with BB&T: <br /> 1. $28,200,000 at a bank qualified tax exempt rate of 3.6% for a term of 15 years <br /> a) County Campus $25,000,000 <br /> b) Parks and Open Space $ 2,800,000 <br /> c) Affordable Housing $ 400,000 <br /> 2. $1,000,000 at a taxable rate of 5.26% for a term of 16 months for Affordable Housing <br /> (Eno Haven project) <br /> 3. $1,717,000 at a bank qualified tax exempt rate of 3.05% for a term of 59 months <br /> a) Property Mgt Info System $1,500,000 <br /> b) Solid Waste Equipment $ 217,000 <br /> You will notice the recommended rate of 3.05% for#3 above is slightly higher than a non- <br /> bank qualified rate of 2.975% that was proposed by another bank. Staff has made this <br /> recommendation because interest savings over the life of the loan of approximately <br /> $3,600 is more than offset by additional fees and costs in completing a separate <br /> financing. <br /> In order to qualify for the small issuer exemption, staff is proposing to decrease the Parks and <br /> Open Space amount from $5.5 million to $2.8 million. The remainder of $2.7 million for Parks <br /> and Open Space would be issued when financing is sought for elementary 11 in the first part of <br /> 2010. The $2.8 million being financed should be more than sufficient to cover project <br /> expenditures until the remainder is financed. However, should expenditures exceed this amount <br /> before the next financing, funds can be advanced and be reimbursed when the remainder is <br />