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ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: February 21, 2012 <br />Action Agenda <br />Item No. S - Q <br />SUBJECT: Adoption of the Final Bond Resolution Authorizing the Issuance of Limited <br />Obligation Bonds to Finance Chapel Hill - Carrboro City Schools Elementary <br />#11, Other County Capital Projects and Refinancing of Existing Obligations <br />DEPARTMENT: Financial Services PUBLIC HEARING: (Y/N) NO <br />ATTACHMENT(S): <br />1. Resolution <br />2. Draft Sizing Document <br />INFORMATION CONTACTS: <br />Clarence Grier, 919-245-2453 <br />Robert Jessup, 919-933-9891 <br />PURPOSE: To adopt the final bond resolution authorizing the issue of Limited Obligation Bonds <br />in the maximum amount of $75 million for the financing of Elementary School #11 for Chapel Hifl <br />- Carrboro City Schools (CHCCS), for other County capital projects and to refinance existing <br />obligations. <br />BACKGROUND: At the February 7, 2012 meeting, the Board of Commissioners approved the <br />financing plan for a new elementary school for the Chapel Hill - Carrboro City Schools, <br />generally referred to as "Elementary #11 ". The Board made a preliminary determination to <br />finance costs for this project by the use of an installment contract, as authorized under Section <br />160A-20 of the North Carolina General Statutes. The total amount to be financed for school <br />construction will be $21,500,000. <br />In addition, County staff included in this financing package $3,500,000 of additional funding for <br />County capital projects. These additions would include $3.0 million for improvements to solid <br />waste convenience centers, and just over $531,500 for the purchase of three ambulances. <br />Combining these projects with the school financing would provide the efficiency of fewer <br />separate transactions, and would be expected similarly to reduce total transaction costs. <br />Additionally, the County's investment banking underwriters for the debt issuance (Branch <br />Banking and Trust - BB&T- Company Capital Markets) advised the County that because of <br />continuing low market interest rates, there was an opportunity for the County to refinance some <br />of the County's existing installment financing arrangements. BB&T estimated that adding <br />approximately $50 million to the debt issuance to refinance existing obligations will save the <br />County $2.9 million over the next 15 years (or approximately $2.59 on a present value basis). <br />The amount of obligations to be refinanced, and the total savings, are dependent on conditions <br />at the time the County's obligations are offered by BB&T in the securities market. The financing <br />