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Home My WebLink AboutRES-2026-018- Amendments to the Series 2019 A and B Limited Obligation Bond Documents 1 xEs -2026- 01 s g- m j 3/,5/a� Resolution authorizing amendments to 2019 financing documents , and requesting approvals from the bond trustee and the Local Government Commission Introduction - In 2019 the County issued two sets of limited obligation bonds, known as the 2019A bonds and the 2019B bonds (as further described on Exhibit B ) , to finance various County projects . Although the County had plans and expectations to spend the bond proceeds within three years of the respective issue dates, project delays (including those related to the start of the pandemic) have resulted in funds not being spent as planned . In addition, the County' s capital funding priorities have changes over time . There remain on hand with the bond trustee approximately $ 9 , 700 , 000 of 2019A proceeds and $ 510 , 000 of 2019B proceeds (these amounts include some accumulated investment earnings) . The two sets of 2019 bonds carry effective interest costs well below what would be available to the County in today' s markets . Without amending the existing bond agreements, the use of the remaining proceeds will be limited to paying debt service on bonds as they become due . County staff now recommends that the County instead amend the existing agreements to allow the use of the remaining proceeds for projects reflecting the County' s current priorities . In particular, County staff would plan to use the proceeds for public improvements of the types described on Exhibit A . The County' s Finance Officer has made available to this Board a draft amending agreement for the 2019A bonds, and there will be a substantially identical amending agreement for the 2019B bonds (together the "Agreements, " as more fully described in Exhibit B) . The Agreements will carry out the plan described in this resolution . The existing bond documents require that the bond trustee and the North Carolina Local Government Commission approve the amendments . The existing County financings are installment financings, as authorized under Section 160A - 20 of the North Carolina General Statutes . In an installment financing, the County' s repayment obligation is secured by a mortgage - type interest in all or part of the property being financed, but not by any pledge of the County' s taxing power or any specific revenue stream . The two 2019 bond issues are secured by a variety of County facilities, and the proposed amendments will not result in any changes to the pledged collateral . 1 . The Orange County Board of Commissioners RESOLVES, as follows : ( a) The County determines to apply the unspent proceeds in hand from the 2019A and the 2019B bonds to additional project costs , and in particular the project costs described on Exhibit A . (b) The Board approves the forms of the Agreements submitted to this meeting. The Board authorizes the Board ' s Chair and the County Manager, or either of them, to execute and deliver the Agreements in their final forms . The amending agreement for the 2019A bonds in its final form must be in substantially the form presented, with such changes as the Chair or the County Manager may approve . The amending agreement for the 2019B bonds must be in substantially the same form as the agreement for the 2019A bonds . The execution and delivery of any Agreement by an authorized County officer will be conclusive evidence of that officer ' s approval of any changes . ( c) The Board, on behalf of the County, asks the LGC and the bond trustee to approve the amendment requests as provided in the draft Agreements . 2 . The Board makes the following findings of fact in support of the County's request to the LGC : ( a) The proposed projects are necessary and appropriate for the County under all the circumstances . (b ) The proposed installment financing amendments are preferable to any available alternative financings . The two sets of 2019 bonds carry effective interest costs well below what would be available to the County in today' s markets . Without the amendments , the County will need to seek new higher - rate financing, or make other funds available , to carry out the desired projects . 2 ( c) Because the debt service on the existing bonds is fully incorporated into the County' s existing debt models, changing the projects to be financed will have no effect on the County' s debt service requirements or tax rate . All amounts disbursed will reflect either approved contracts, previous actual expenditures, or professional estimates . ( d) As confirmed by the County' s Finance Officer, ( i) the County' s debt management procedures and policies are sound and in compliance with law, and (ii) the County is not in default under any of its debt service obligations . 3 . The Board resolves as follows with respect to certain tax matters related to the 2019 bonds and the Agreements : The County will not take or omit to take any action the taking or omission of which will cause its obligations to pay principal and interest (the " Obligations ") with respect to the 2019A bonds and the 2019B bonds to be " arbitrage bonds, " within the meaning of Section 148 of the " Code " ( as defined below) , or "private activity bonds " within the meaning of Code Section 141, or otherwise cause interest components of the installment payments to be includable in gross income for federal income tax purposes . Without limiting the generality of the foregoing, the County will comply with any Code provision that may require the County at any time to pay to the United States any part of the earnings derived from the investment of the financing proceeds . In this resolution, " Code " means the United States Internal Revenue Code of 1986, as amended, and includes applicable Treasury regulations . 4. Additionally, the Board resolves as follows : (a) The County intends that the adoption of this resolution will be a declaration of the County' s official intent to reimburse project expenditures from financing proceeds . The County intends that funds that have been advanced for project costs, or which may be so advanced, from the County' s general fund, or any other County fund, may be reimbursed from the financing proceeds. (b) The Board authorizes all County officers and employees to take all further action as they may consider necessary or desirable in furtherance of the purposes of this resolution and to complete the contemplated amendment process . The Board ratifies all prior actions of County officers and employees to this end . 3 Without limiting the generality of the foregoing, the Board authorizes the County Manager to approve changes to any documents previously signed by County officers or employees, provided that the changes do not conflict with this resolution or substantially alter the intent from that expressed in the form originally signed . The County Manager' s authorization of the release of any document for delivery will constitute conclusive evidence of that officer ' s approval of any changes . ( c) If for any reason the County Manager, the Chair or the Finance Officer is absent or unavailable , then any other officer may carry out any function assigned in this resolution . In addition, the Vice Chair or any Deputy or Assistant Clerk may carry out any assigned function . The Clerk may apply the County' s seal , and may attest to the seal, on any document related to this resolution . ( d) All other Board proceedings , or parts thereof, in conflict with this resolution are repealed, to the extent of the conflict, and this resolution takes effect immediately. I certify as follows . that the foregoing resolution was properly adopted at a meeting of the Board of Commissioners of Orange County, North Carolina ; that this meeting was properly called and held on March 5 , 2026 ; that a quorum was present and acting throughout this meeting, and that this resolution has not been modified or amended , and remains in full effect as of today. DatedthisS. day of March, 2026 . [ S A 17 52 Clerk, Boar o Commissioners Orange County, North Carolina prt�A 1Cxca�'�� 4 Exhibit A - proposed proms 2019A Bonds - Approximately $ 9 , 700 , 000 of proceeds remains on hand, including accumulated investment earnings . The County will allocate these funds as follows : Type Amount Parks and recreation facilities 347 , 000 Link Center repair and renovation 1 , 8000000 Vehicle replacements 21800 , 000 School capital projects 31789 , 471 Reserve for excess earnings 400 , 000 payments to IRS Leave with Trustee for future debt 552 , 000 service payments Total 91688 , 471 These uses are within the scope of the uses authorized at the time of the financing. Funds for school capital projects and parks and recreation facilities will all be reimbursed to the County once the funds are available . The County expects to use the remainder of the money within about one year . 2019B Bonds - Approximately $ 510 , 000 of proceeds remains on hand, including accumulated investment earnings . The County will allocate all of these funds to new vehicle acquisition . Vehicle acquisition was an initially- authorized purpose of the 2019B Bonds . The County expects to use this money for additional vehicle acquisitions within about six months of completing the process to make those funds available . s Exhibit B - - draft Agreements l { The Board has been presented a draft dated February 19 , 2026 of a Supplemental Amending Trust Agreement (Amending Series 2019A Agreements) , between the County and The Bank of New York Mellon Trust Company, N .A . , which serves as bond trustee for the County. The County will execute and deliver a substantially similar Amending Trust Agreement with respect to the 2019B bonds . The two Supplemental Amending Trust Agreements, respectively, amend the supplemental trust agreements and other documents that provided for the original issuance of the County' s $ 14, 135 , 000 Limited Obligation Bonds , Series 2019A, and the County' s $ 29 , 745 , 000 Limited Obligation Bonds , Series 2019B . i 6