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PA <br />the financing including the issuer of the project and the tax credit rate. The potential purchaser <br />will determine whether to purchase the QSCB and further determine whether the tax credit rate <br />is sufficient, or if a higher interest rate, is needed to make the financing. <br />Branch Banking Trust (BB &T) will be the purchaser of this issuance and was also the issuer of <br />the previous QSCB issuance for the Carrboro High School Arts Wing. The current approach for <br />this type of financing is to negotiate terms directly with the purchaser. <br />BB &T requires a 5.27% or higher tax credit in order to sustain a QSCB financing at 0% interest. <br />Due to recent changes in the interest rates, Orange County will not have a supplemental <br />interest coupon of 1.00% as mentioned in the previous public hearing abstract. The interest <br />rate on the financing would be 0 %. The approximate annual payment for a $9.899 million /15 <br />year financing loan with a coupon rate of 0% would be $659,963 per year, with a no interest <br />cost over the life of the loan. This represents a savings of $54,037 in debt service from the <br />previous public hearing. <br />FINANCIAL IMPACT: There is no financial impact until the issuance of the bonds. <br />RECOMMENDATION(S): The Manager recommends that the Board: <br />1) Open the public hearing and receive comments from the public; <br />2) Close the public hearing; and <br />3) Approve the Resolution Providing Final Approval of Terms and Documents for QSCB <br />School Improvements Financing. <br />