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TO: |
Board of Trustees |
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THROUGH: |
Mary DeLoretto, Interim Executive Director |
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FROM: |
William Greene, Chief Financial Officer |
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PRESENTER(S): |
Brian Baker, Financial Advisor, Partner at Zion Capital Advisors |
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TITLE:
title
Potential 2015A Senior and Subordinate Sales Tax Revenue Refunding Bond Opportunity in 2021
end
AGENDA ITEM TYPE:
Discussion
RECOMMENDATION:
Provide advice on refunding opportunity and authorize staff to move the process forward by consulting with the Local Advisory Council and State Bonding Commission in September.
BACKGROUND:
UTA issued bonds in 2015 to finance capital projects and refund previous bonds. These bonds represented the best rates at the time, but the market changes over time. The bonds being evaluated for possible refunding currently are the remaining 4.0%-5.0% Bonds of the 2015A Issue with principal payments of $405.27 million starting in 2021 and going through 2037.
DISCUSSION:
State statutes governing UTA’s bond refunding require several steps. The initial discussions for this bond refunding starts with the Board of Trustees. If recommended by the Trustees, the proposal will proceed to the September Local Advisory Council meeting for consultation, and ultimately to the State Bonding Commission meeting. If these bodies concur with the refunding, the Board will have to act on a resolution at a future meeting of the Board of Trustees where they would set terms of the potential refunding and authorize financial agents to carry out the process.
Zion Capital Advisors will present the latest financial forecast prepared for the refunding with the possible net present value savings and speculated interest rates in the market at the time of refunding.
ALTERNATIVES:
Take no action at this time to refund the 2015A Bonds
FISCAL IMPACT:
The refunding could have the following benefits: overall reduction in interest paid on bonds, and possibly restructuring on UTA current debt portfolio maximums in 2029 with a net present value savings of at least five percent.
ATTACHMENTS:
None