Loading...
HomeMy WebLinkAboutAgenda - 10-18-94 - V-A 1 ORANGE COUNTY BOARD OF COMMISSIONERS Action Agenda Item No V-A ACTION AGENDA ITEM ABSTRACT Meeting Date: October 18, 1994 SUBJECT: Resolution Authorizing the Filing of an Application for Installment Purchase of the New Chapel Hill-Carrboro Elementary School DEPARTMENT: Finance PUBLIC HEARING YES NO x ATTACHMENT(S) : INFORMATION CONTACT Resolution Ken Chavious, ext 2450 TELEPHONE NUMBER Hillsborough 732-8181 Chapel Hill 968-4501 Mebane 227-2031 Durham 688-7331 PURPOSE: To consider adoption of a resolution indicating the County' s intent to file an application for the installment purchase of the new Chapel Hill-Carrboro City Schools' elementary school. BACKGROUND: At their regular meeting on September 20, 1994, the Board of Commissioners authorized staff to pursue installment purchase financing of the new Chapel Hill-Carrboro City Schools elementary school, to be constructed adjacent to McDougle Middle School. The Board authorized financing an amount up to the estimated project cost of the new school, which is $10,646,915. The Board also instructed the Manager to work with CHCCS to pursue a more advantageous financing plan, if available. School and County staffs have met and agreed that the best financing plan appears to be arranging for $9.6 million in installment contract financing, with the balance of the project to be funded with the $1.05 million already included in the 1994-95 CIP. This financing approach will enable the staff to investigate both Certificates of Participation (COPS) and private placement with a financial institution, and to select the more advantageous of these two financing arrangements. As part of their review of this financing arrangement, the Local Government Commission requires a procedural step involving the Board of County Commissioners' adoption of a "Resolution Authorizing the Filing of an Application for Approval of a Financing Agreement Authorized By North Carolina General Statute 160A-20. " The attached resolution will accomplish this requirement. RECOMMENDATION: The Manager recommends that the Board approve the resolution and authorize the Finance Officer to execute all documents and procedural steps related to the new school installment purchase application process. 2 ORANGE COUNTY BOARD OF COMMISSIONERS A RESOLUTION AUTHORIZING THE FILING OF AN APPLICATION FOR APPROVAL OF A FINANCING AGREEMENT AUTHORIZED BY NORTH CAROLINA GENERAL STATUTE 160A-20 WHEREAS, the County of Orange, North Carolina desires to construct a new elementary school in the Chapel Hill-Carrboro City Schools district to address overcrowding at the elementary school level within the district; and WHEREAS, the County of Orange desires to finance the Project largely by the use of an installment contract authorized under North Carolina General Statute 160A, Article 3, Section 20; and WHEREAS, findings of fact by this governing body must be presented to enable the North Carolina Local Government Commission to make its findings of fact set forth in North Carolina General Statute 159, Article 8, Section 151 prior to approval of the proposed contract; NOW, THEREFORE, BE IT RESOLVED that the Board of Commissioners of Orange County, North Carolina, meeting in regular session on the 18th day of October, 1994, make the following findings of fact: 1. The proposed contract is necessary or expedient because the elementary student population in the Chapel Hill-Carrboro City Schools is significantly over the capacity of the district' s existing elementary school buildings and no practical or timely alternative to the construction of permanent additional elementary school space is available. The student population in the district has increased rapidly in recent years and is projected by the North Carolina Department of Public Instruction to continue growing substantially for the foreseeable future. 2. The proposed contract is preferable to a bond issue for the same purpose because: a. availability of the new elementary school is urgently needed in time for the 1996-97 school year and the contracting method is the most expeditious method of raising cash quickly to meet the extremely tight construction timetable for a 1996-97 school opening; b. the cost of the elementary school, estimated at just over $10.6 million, cannot be prudently raised from currently available appropriations, unappropriated fund balances, or non-voted bonds; c. the North Carolina General Assembly adopted legislation during the 1994 Session intended specifically to permit Orange County to pursue installment financing for this elementary school project, and any future projects that might become necessary. 3. The cost of financing under the proposed contract could be greater than the cost of issuing general obligation bonds. However, this method of financing will increase the alternatives available to Orange County to obtain the most cost effective, timely, and flexible means possible of funding this necessary project. Given Orange County' s excellent credit standing, any difference in the comparable costs between bond financing and installment purchase financing will be reasonable. 3 4 . The sums to fall due under the contract are adequate and not excessive for the proposed purpose because funding of the debt service thus created is already planned in Orange County' s long-term Capital Improvement Plan. 5. The County of Orange' s debt management procedures and policies are good because the County' s existing and planned debt falls well within North Carolina's legal debt limitations for local governments; furthermore, Orange County' s excellent creditworthiness is well recognized by investors and well established by the principal municipal bond rating agencies with bond ratings of Aal (Moody' s) and AA+ (Standard & Poor' s) . 6. There will be no increase in ad valorem property taxes necessary to meet the sums to fall due under the proposed contract. Payments due under the proposed contract will be financed by school impact fees accrued and pay-as-you-go sales tax revenues. 7 . The County of Orange is not in default in any of its debt service obligations. 8. The Attorney for the County of Orange has rendered an opinion that the proposed Project is authorized by law and is a purpose for which public funds may be expended pursuant to the Constitution and laws of North Carolina. NOW, THEREFORE, BE IT FURTHER RESOLVED that the Finance Officer is hereby authorized to act on behalf of the County of Orange in filing an application with the North Carolina Local Government Commission for approval of this Project and the proposed financing contract and other actions not inconsistent with this resolution. This resolution is effective upon its adoption this 18th day of October, 1994. The motion to adopt this resolution was made by Commissioner seconded by Commissioner , and passed by a vote of to Stephen Halkiotis, Vice Chair ATTEST: Beverly C. Blythe, Clerk to the Board This is to certify that this is a true and accurate copy of this resolution adopted by the Orange County Board of Commissioners on the 18th day of October, 1994. Beverly C. Blythe, Clerk to the Board Date