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2 <br /> County and School projects, the financing team has determined that a private bank financed <br /> transaction with Capital One is now the best option. Capital One will hold an interest rate of 2.7% <br /> through May 12, 2020, with three bids having been received. <br /> It is important to note that this interest rate is well within the County's Debt and Affordability Model. <br /> The County's ability to close in May and fund the CMAR and other Capital Investment Plan (CIP) <br /> projects without uncertainties regarding capital market access was a strong financing <br /> consideration for shifting to this privately placed bank financing. If the Board adopts the resolution, <br /> staff expects to close and receive proceeds by mid-May. <br /> The financing strategy at this time does include moving forward with the competitive sale of the <br /> General Obligation (GO) bonds for Orange County Schools. The County's AAA rating was <br /> affirmed by all three rating agencies the week of March 30, 2020. The rationale for the varying <br /> financing approaches between this transaction and the GO bonds is that the capital market <br /> acceptance of the GO bond is based on the government's full faith and credit/taxing power which <br /> is well established with investors, and the GO bond sale will now not compete with the Northern <br /> Campus CMAR bank financing. <br /> FINANCIAL IMPACT: A preliminary estimate of maximum debt service applicable to the capital <br /> investment projects and equipment financing would require the highest debt service payment of <br /> $3.6 million in FY 2021-22. The tax rate equivalent for the estimated highest debt service payment <br /> is approximately 1.91 cents. <br /> SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to <br /> this item: <br /> • GOAL: FOSTER A COMMUNITY CULTURE THAT REJECTS OPPRESSION AND <br /> INEQUITY <br /> The fair treatment and meaningful involvement of all people regardless of race or color; <br /> religious or philosophical beliefs; sex, gender or sexual orientation; national origin or ethnic <br /> background; age; military service; disability; and familial, residential or economic status. <br /> • GOAL: CREATE A SAFE COMMUNITY <br /> The reduction of risks from vehicle/traffic accidents, childhood and senior injuries, gang <br /> activity, substance abuse and domestic violence. <br /> • GOAL: ENABLE FULL CIVIC PARTICIPATION <br /> Ensure that Orange County residents are able to engage government through voting and <br /> volunteering by eliminating disparities in participation and barriers to participation. <br /> ENVIRONMENTAL IMPACT: The following Orange County Environmental Responsibility Goal <br /> impacts are applicable to this item: <br /> • ENERGY EFFICIENCY AND WASTE REDUCTION <br /> Initiate policies and programs that: 1) conserve energy; 2) reduce resource consumption; <br /> 3) increase the use of recycled and renewable resources; and 4) minimize waste stream <br /> impacts on the environment. <br /> • RESULTANT IMPACT ON NATURAL RESOURCES AND AIR QUALITY <br /> Assess and where possible mitigate adverse impacts created to the natural resources of <br /> the site and adjoining area. Minimize production of greenhouse gases. <br /> RECOMMENDATION(S): The Manager recommends that the Board approve the final financing <br /> resolution authorizing the steps to proceed with the financing of the stated capital projects and <br /> equipment. <br />