Orange County NC Website
Browse       Search
2 <br /> • County staff reviews financing proposals from lenders and develops <br /> recommendation for Board approval — by end of March <br /> • County Board adopts resolution formally approving financing provider and the <br /> substantially-final financing documents —April 19 <br /> • LGC approves financing — May 3 <br /> • Closing on the financing —funds advanced to County — by mid-May <br /> The County's financing is proceeding as an installment financing under the authority of the North <br /> Carolina General Statutes. Under the statutes, an installment financing has to be secured by a <br /> lien on part or all of the property being acquired or improved through the financing. County staff <br /> recommends that the County use Grady Brown Elementary School as the collateral. Grady <br /> Brown is receiving two new roofs through the financing package. For the County to provide a <br /> lien on this school, the County must own the school. <br /> The Orange County Board of Education has approved the use of the school as collateral and <br /> the related transfer of that property to the County (the financing documents will provide for the <br /> return of the school upon the County's repayment of the financing). This is similar to <br /> arrangements the County has used previously, most recently with respect to financings related <br /> to the Orange County Schools District's Gravelly Hill Middle School and with Culbreth Middle <br /> School in Chapel Hill Carrboro City Schools. Ownership of Grady Brown will revert back to <br /> Orange County Schools upon final payment of the installment financing. <br /> FINANCIAL IMPACT: There is no financial impact related to this action. However, there will be <br /> a financial impact in proceeding with the financing. A preliminary estimate of maximum debt <br /> service applicable to the capital investment projects and equipment financing would require the <br /> highest debt service payment of $871,454 in FY 2016-17. The tax rate equivalent for the <br /> estimated highest debt service payment is approximately 1/2 cent. Based on current resources <br /> and the retirement of existing debt, no adjustment to the tax rate associated with this financing is <br /> anticipated to occur during the period noted. <br /> SOCIAL JUSTICE IMPACT: There is no Orange County Social Justice Goal impact associated <br /> with this item. <br /> RECOMMENDATION(S): The Manager recommends that the Board conduct the public <br /> hearing and adopt the resolution supporting the application to the Local Government <br /> Commission for approval of the financing and refinancing arrangements. <br />