Revenue Bonds Series 2016 March 29 th 2016 Christopher Quinn MACC CPA CFE CGFO CGMA City of Palm Coast Finance Director Mark Galvin FirstSouthwest Director Utility Revenue Bonds Series 2016 ID: 556769
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Utility Revenue Bonds Series 2016March 29th, 2016
Christopher Quinn, MACC, CPA, CFE, CGFO, CGMACity of Palm Coast, Finance DirectorMark GalvinFirstSouthwest, DirectorSlide2
Utility Revenue Bonds, Series 2016Background:Slide3
Existing Utility Revenue Bonds, Series 2007Slide4
City of Palm Coast, FloridaOn February 23rd, the City Council authorized Staff and the Financial Advisor to seek proposal from Banks and compare responses to a bond issue to make sure the rate and covenants are at least comparable.RFP issued February 29th and closed March 14th and the City received 3 bids with Ameris being the lowest and best bid:
A rate of 2.48% lock in for the entire life of the loan (10/1/36)Rate is good until April 22nd eliminating interest rate risk to the City The ability to prepay at anytime without penaltyNo additional Tax Gross up Language Willing to accept existing bond covenants
Also compared their proposal to a bond issue:Their rate was lower than a expected bond issue assuming rates as of March 14, 2016
More flexible
prepayment
, lower fees
No onerous bond
covenants
Notes:
Analysis is preliminary & subject to change.
Bond Issue Scenarios assume A+ rated bonds and interest rates as of 3/14/2016.
Utility System Revenue Refunding Bonds, Series
2016
Background
:Slide5
City of Palm Coast, FloridaUtility System Revenue Refunding Bonds, Series 2016 Notes:Analysis is preliminary & subject to change; Total Savings and Average Savings takes into consideration the use of $3,130,931.26 of the Series 2007 DSR to be used to in the Series 2007 Escrow.Scenario
Refunding Results Summary
Total Savings
12,416,149
Average Annual Savings
591,245
Present Value Savings ($)
6,508,081
Present Value Savings (%)
15.42%
Refunding Issue Summary (Series 2016)
Principal Amount
40,188,000
Maturity Date
10/1/2036All-In TIC2.52%Maximum Annual Debt Service2,524,954Total Debt Service51,720,104Refunded Issue Summary (Series 2007) Principal Amount Outstanding42,200,000Principal Amount Refunded42,200,000Maturities Refunded2016 - 2036Average Coupon Refunded4.43%Call Date/Price4/1/2017
Ameris – Bank Loan Proposal
:Slide6
City of Palm Coast, FloridaUtility System Revenue Refunding Bonds, Series 2016 Timetable:March 29, 2016 – Approval of Documents by City CouncilMarch 29, 2016 - Lock in Escrow Securities / Finalize Loan issue sizeApril 19
th- Pre-closingApril 20th ClosingNotes:
Analysis is preliminary & subject to change; Total Savings and Average Savings takes into consideration the use of $3,130,000 of the Series 2007 DSR to be used to in the Series 2007 Escrow.Slide7
Utility Revenue Bonds, Series 2016Next Steps:Evaluate Refinancing OptionsBank Loan vs. Bond IssueSelect Best Option for City Council Consideration
Execute Bank Loan Agreement with Ameris BankSlide8
Questions?