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ORANGE COUNTY <br /> BOARD OF COMMISSIONERS <br /> ACTION AGENDA ITEM ABSTRACT <br /> Meeting Date: November 19. 1997 <br /> Action Agenda <br /> Item No. <br /> SUBJECT: Financing for Skills Development Center Renovations <br /> DEPARTMENT: County Manager/Finance PUBLIC HEARING: (YIN) <br /> BUDGET AMENDMENT: (Y/N) <br /> ATTACHMENT(S): INFORMATION CONTACT: <br /> Resolution Authorizing Financing Application Rod Visser, ext 2300 <br /> Public Hearing Notice Ken Chavious, ext 2450 <br /> 11/13/97 Staff Memo on Financing Options <br /> TELEPHONE NUMBERS: <br /> Hillsborough 732-8181 <br /> Chapel Hill 968-4501 <br /> Durham 688-7331 <br /> Mebane 227-2031 <br /> PURPOSE: To consider adoption of a resolution indicating the County's intent to file an <br /> application with the Local Government Commission for an installment purchase for renovations to <br /> the Skills Development Center located at 501/503 West Franklin Street; and to establish a date for a <br /> public hearing on the financing proposal. <br /> BACKGROUND: County staff has been examining options to fund the renovation of <br /> the Skills Development Center located at 501/503 West Franklin Street. Bids for these renovations <br /> are due to be opened on November 20. The attached staff memorandum identifies some of the <br /> financing options that the Board may consider. <br /> The Manager recommends that the Board pursue the option of seeking approval from the Local <br /> Government Commission(LGC)to finance the project using an installment purchase. Installment <br /> purchase, or"private placement", is the financing approach that was contemplated in the 1997-2007 <br /> Capital Improvements Plan. If the financing can be completed before the end of the calendar year, <br /> the County will be able to remain"bank qualified" as a small issuer, having incurred less than $10 <br /> million in debt during 1997. Bank qualification would permit the County to obtain financing at <br /> interest rates 1.5% - 2% lower than if taxable debt must be incurred. If the installment purchase <br /> option is selected, the LGC requires the Governing Board to adopt a resolution which authorizes <br /> staff to submit an application for consideration and states certain findings of fact regarding the <br /> project necessity. The attached resolution was prepared in accordance with the LGC guidelines and <br /> will satisfy LGC requirements. <br /> The County's purchase of the building that will house the Skills Development Center was arranged <br /> through installment purchase with NationsBank.The Bank is willing to submit a proposal for the <br /> financing of the proposed renovations. Early indications are that the rate will be comparable to, if <br />