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15 <br /> 1 To facilitate the project, staff proposes that Orange County provide a loan in the amount of <br /> 2 $1,700,000 to OGFD. The loan will be evidenced by a promissory note and repaid through annual <br /> 3 payments of principal and interest due each January 15 beginning in 2027, with final maturity no <br /> 4 later than January 15, 2047. <br /> 5 <br /> 6 Schedule I of the Promissory Note references the OGFD debt service schedule through final <br /> 7 maturity. It is important to note that the debt service schedule uses a planning rate of 5%. (Note: <br /> 8 The 5%planning rate is subject to the final bond pricing rate.The final interest rate will be updated <br /> 9 in the signed Promissory Note.) <br /> 10 <br /> 11 OGFD Annual Tax Levy <br /> 12 The Fire District has adjusted its tax rate from 5.81 cents to 7.00 cents per $100 of assessed <br /> 13 valuation beginning in FY 2025-26 to ensure sufficient revenues to cover operating costs and the <br /> 14 required annual debt service payments to the County. <br /> 15 <br /> 16 Under the proposed structure, the Fire District will reimburse the County annually for the full <br /> 17 amount of debt service. If the Fire Department fails to make the required payment, the County <br /> 18 will have the authority to offset overdue amounts from district tax distributions or other funds <br /> 19 payable to the department, and per the promissory note can impose a 5% penalty on the amount <br /> 20 due. <br /> 21 <br /> 22 County Recourse for Annual OGFD Repayment <br /> 23 The County provides annual property tax revenues to OGFD in four equal quarterly payments <br /> 24 each fiscal year based on their district tax levy. The OGFD debt service repayment date will be <br /> 25 set for January 15 every fiscal year which coincides with peak tax collections for OGFD. If debt <br /> 26 service payment is not received by January 15, the County will deduct and apply, through a right <br /> 27 of set-off, an amount from the fourth quarter (March) property tax distribution to OGFD <br /> 28 sufficient to satisfy the annual debt service requirement. The OGFD repayment will be recorded <br /> 29 in the County's Debt Service Fund. <br /> 30 <br /> 31 Gary Donaldson, Chief Financial Officer, introduced the item. He said the Orange Grove <br /> 32 Fire District is in a sound position to pay back the loan. He reviewed the repayment schedule for <br /> 33 the county. <br /> 34 Daniel Snipes, Board President of the Orange Grove Fire Department, said the project was <br /> 35 initially proposed in 2023. He said they've set aside money annually for the project. He said they <br /> 36 considered borrowing funds from other sources, but borrowing with Orange County was a great <br /> 37 opportunity. He said all their meetings, board meetings, and trainings are open to the public. He <br /> 38 said they communicate with the public through social media and the newspaper. He said most of <br /> 39 the department's calls are served by the site in question. He said the project would allow them <br /> 40 to serve the area more efficiently. He said the station is currently a metal building, with a small <br /> 41 heater just big enough to keep the trucks from freezing and one bathroom. He said if they build <br /> 42 the new station, they can move daytime staff from Station 1 and decrease response times to the <br /> 43 area. <br />