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ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: February 16, 2006 <br />Action Agenda <br />Item No. ~_ <br />SUBJECT: Confirmation of Public Hearing Notice for Debt Financing <br />DEPARTMENT: Finance PUBLIC HEARING: (Y/N) No <br />ATTACHMENT(S): <br />Draft Public Hearing Notice <br />INFORMATION CONTACT: <br />Ken Chavious, 919-245-2453 <br />Bob Jessup, 919-755-1800 <br />PURPOSE: To review and confirm the content of the notice for the March 2, 2008 public <br />hearing required by the North Carolina Local Government Commission (LGC) for the issuance <br />of Orange County debt. <br />BACKGROUND: At the Febnaary 9 regular meeting, the BOCC established a required public <br />hearing date of March 2 for the planned issuance of $22 million in non-bond debt for a variety of <br />school and County projects. The County will use Certificates of Participation (COPS) as the <br />alternative financing mechanism, and will be pursuing an issuance date in late April 2006. <br />Projects to be included in the COPs deal are listed on the public hearing notice, with specific <br />amounts associated with each to be determined or confirmed at this February 16, 2006 work <br />session. <br />The face value of the planned debt far school and County projects is $22,000,000, However, <br />based on advice received this week from staff of the Local Government Commission (LGC), the <br />Board is asked to authorize publication of a notice that cites an amount not to exceed <br />$24,000,000, The difference between project costs and issuance amount relate to conservative <br />estimates of issuance costs and discounts associated with marketing the COPs, Original issue <br />discounts require the Issuance of additional certificates above the project costs that serve to <br />lower the overall interest rate resulting in savings to the County. Annual debt service <br />requirements associated with this issuance will remain within the County's debt policy <br />parameters and are in line with previous projections. <br />As is the case with other financings undertaken recently by the County, this debt issuance will <br />require the approval of the Local Government Commission (LGC), County staff have arranged <br />with LGC staff to have the County's financing application considered for approval at the LGC's <br />April 4, 2006 meeting, The establishment of the public hearing date and the advertisement of <br />the public hearing notice to receive public comment on the advisability of the proposed debt <br />issuance are two of the initial steps in the LGC process.. The County's Band Counsel and staff <br />have prepared the accompanying public hearing notice far publication, which reflects input <br />received from the BOCC at the February 9 meeting. <br />