Agenda - 11-02-2006-5g - Laserfiche WebLink

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ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: November 2, 2006 Action Age~a Item No. ____~ SUBJECT: Carrboro High School Financing Resolution DEPARTMENT: Finance PUBLIC HEARING: (Y/N) No ATTACHMENT (S): INFORMATION CONTACT: Resolution ~ Ken Chavious, 919-245-2450 Bob Jessup, Bond Counsel PURPOSE: To consider adopting a resolution that provides for final approval of the installment financing component of the Carrboro High School project that is under construction in the Chapel Hill-Carrboro City Schools (CHCCS) system. BACKGROUND: At the September 12, 2006 meeting, the Board of Commissioners took action authorizing staff to pursue private placement financing to acquire the final phase of funding for the Carrboro High School project. Subsequently, on October 3, the Board conducted a public hearing on matters related to the advisability of entering into the financing. Both Board actions are part of the process required by the Local Government Commission (LGC) in order to obtain financing for the project. In accordance with these actions, staff pursued a request for proposal process to acquire financing for the project in the amount of $9,000,000. Staff solicited and received proposals from financial institutions. Of those submitted, the Branch. Banking & Trust Company (BB&T) proposal was the most favorable. This proposal included an interest of 4.39% fora 15 year term. Staff had originally contemplated that this financing would be on a short-term basis, and would be rolled into a larger longer term financing using certificates of participation (COPs) scheduled for the Spring of 2007. However, the fixed rate financing proposed by BB&T provides an interest rate that is actually lower than the recent COPs issued by the County. In addition, issuance costs associated with the BB&T proposal will be significantly less than would be the costs associated with issuing COPs. An application requesting approval of this proposed financing will be forwarded to the Local Government Commission (LGC) in accordance with statutory provisions. The LGC is scheduled to take action on the County's application on December 5, 2006. The final Board action required for LGC approval of the financing is the adoption of a resolution providing final approval of the proposed financing. The attached resolution has been prepared by Bond Counsel in accordance with statutory and LGC requirements. The resolution accomplishes the following: • Makes the determination to proceed with the financing. • Directs and authorizes staff to execute the financing documents.