HomeMy WebLinkAboutAgenda - 10-17-2017 - 6-b - Revision to General Obligation Bond Sale Amount 1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: October 17, 2017
Action Agenda
Item No. 6-b
SUBJECT: Revision to General Obligation Bond Sale Amount
DEPARTMENT: Finance and Administrative
Services
ATTACHMENT(S): INFORMATION CONTACT:
Revised General Obligation Bond Gary Donaldson, 919-245-2453
Sale Resolution Paul Laughton, 919-245-2152
Bob Jessup, 919-933-9891
PURPOSE: To provide final Board authorization for general obligation bond sale issues for 1)
two-thirds school bonds in the amount of $5,900,000; 2) voter-approved school bonds in the
amount of $21,000,000; and 3) voter-approved affordable housing bonds in the amount of
$2,500,000. The aforementioned bond amounts represent the first tranche of authorized
general obligation bonds.
BACKGROUND: On October 3, 2017, the Board of Commissioners approved the sale of
general obligation bonds for various purposes in the amount of $40 million. Based on the
overbid results of Chapel Hill-Carrboro City Schools (CHCCS) Lincoln Center project and upon
the direction of the Local Government Commission, the County must reduce the amount of
voter-approved school bonds to be sold from $40 million to $21 million on this first issuance of
bonds. The attached resolution approves that change.
This change does not impact the Orange County Schools first bond issuance amount of $15.9
million. The CHCCS bond amount is changed from $24 million to $5 million pending the
CHCCS final decision on project amounts for its projects. The initial $5 million is to reimburse
for CHCCS design expenditures to date on the Lincoln Center and Chapel Hill High School and
cash flow the remainder of design expenditures through the Chapel Hill High School bid
openings in April/May 2018. This additional time will allow CHCCS to determine a definitive
funding plan for its bond projects. The County would then present a revised funding application
and recommendation of issuing remaining first bonds for CHCCS in April/May 2018 to the Local
Government Commission.
In accordance with the County Capital Investment Plan and in advisement with the County's
bond counsel and financial advisor, County staff recommends that the County proceed with a
General Obligation Bond Sale.
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The actual interest rates on these bonds will be set when the Local Government Commission
takes competitive bids on October 24, 2017, and the bond closings are scheduled for November
14 and 15.
FINANCIAL IMPACT: The General Obligation bonds are included in the County's FY 2017-
2022 CIP and debt affordability report on June 13, 2017 work session which indicated a tax
equivalent impact ranging from 4.56 cents (upfront) to 5.76 cents (incremental).
SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to
this agenda item:
• GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY
The creation and preservation of infrastructure, policies, programs and funding necessary
for residents to provide shelter, food, clothing and medical care for themselves and their
dependents.
RECOMMENDATION(S): The Manager recommends that the Board approve the attached
revised resolution.
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RES-2017-066
Resolution To Adjust the Bond Sale Amounts
WHEREAS--
On October 3, the Board of Commissioners approved the sale of general
obligation bonds for various purposes. Based on the results of construction bids for
school projects and upon the direction of the Local Government Commission, the
County must reduce the amount of voter-approved school bonds to be sold, from
$40 million to $21 million. This resolution approves that change.
BE IT THEREFORE RESOLVED by the Board of Commissioners of Orange
County, North Carolina, that the bonds to be sold pursuant to the October 3
resolution will be (a) $21,000,000 of voter-approved school bonds, (b) $2,500,000
of voter-approved affordable housing bonds, and (c) $5,900,000 of "two-thirds"
school bonds. The Finance Officer may approve a further change in the amount of
any bonds to be sold, upon the advice of the LGC and up to the amounts previously
specified in the October 3 resolution. All other provisions of the October 3
resolution are confirmed.