Travis County Commissioners Court
Tuesday, March 22, 2011,
Item 6
Item number 6, consider and take appropriate action on adoption of an order authorizing publication of notice of intent to issue certificates of obligations.
>> good morning, judge, lance tillo, financial advisor and glenn opel, bond council is also with me.
this is the necessary step in the annual issuance.
when we are issued cos is authorize the notice of intent to issue which has to be published at least 30 days prior to the offering.
glenn prepared the resolution and if he has any remarks to make, I'll turn it over to him.
>> judge, Commissioners, we drafted the order authorizing the notice of publication of intent to issue the cos.
we've worked with staff at setting the amount at 45 million, I'm happy to answer any questions but I'll turn it over to staff to describe what we're doing.
>> sure.
the projects that we're discussing are the certificates of obligation and those total 44.5 million.
>> yes, sir, and one of the things we do need clarification on the court on, we had talked a few months ago regarding the acquisition of the land for the new courthouse.
we had identified 22,500,000 for that acquisition.
we had tentatively notated that that would be taxable issuance and we want to give court's direction on that as well.
we would recommend that we issue that as taxable.
>> plus associated issuance costs.
>> correct.
>> excuse me.
as far as the notification of intent, could you just explain to the public the mechanics of that?
in other words, where would the notice appear on that.
everyone is not up to speed on the process and I think it would be good to know the mechanics of what we're doing here.
>> yes, sir.
in order to issue certificates of obligation, the law requires that you publish a notices of your intention to issue those certificates.
that notice will set forward a not to exceed principal amount and will list the categories of projects for which those certificates of obligation will be used.
with respect to the item you were just talking about, which is the taxable amount for the land, we've structured the notice this year in the same way we did last year with respect to when the county was looking at 700 lavaca.
the notice is structured in a not to exceed $45 million amount, but it authorizes them to be issued, the cos to be issued in one or more series of taxable and tax exempt.
as we issue the notice, while I think we have an intention from the court to say it's our goal come forward with 22.5 million of that as tax I believe, if as the process moved along there was some need for minor change in that, the notice is flexible enough to allow to you adjust to meet that.
the notice is required to be published once a week for two consecutive weeks, the first publication being not less than 30 days before the date on which you plan to adopt the order authorizing the issuance of the certificates of obligation.
that notices we'll work with staff to publish in the states man and then as the protest moves forward, there are potential petition opportunities under the statute.
barring those, we would come back on the date -- I'm not sure what you have in the schedule.
>> April 26th.
>> is April 26th.
that date is also set forth in the notice and that's the date on which we would come back and adopt the order and actually authorize the issuance of the certificates of obligation.
>> thank you for that explanation.
>> for us, what would be the advantage of taxable cos?
>> the advantage of issuing taxable -- taxable certificates of obligation with respect to this piece of property is that it allows you more flexibility in the use of the property going forward.
issuing -- when you issue tax exempt obligations there are restrictions on what you can do with respect to the use of the property as relates to private use or private payments with respect to that property, it gets pretty deep pretty fast.
but the point being if the court is looking at alternative forms of finance that may involve public-private ventures, public-private partnerships, going with taxable debt to buy that property frees you, frees you or gives you the flexibility to look at those without the underlying restrictions of a tax exempt obligation on the property itself.
so in many respects it's preserving going taxable on that is preserving opportunity to look at various alternative financing mechanisms.
>> does the law require just one publication of this notice or several?
>> I'm sorry, sir, once a week for two consecutive weeks.
they will be published twice.
the first publication -- actually it says before the 30th day before.
so it's required to be published the 31st day before you adopt it and then we'll publish on the same day in the next week.
so it is published twice.
>> I was just saying as far as the holder of the -- possessor of the notification, that particular -- you said the american statesman is just required for it to be in one particular advertisement as far as the notice is concerned?
>> it's required to be published -- certificates of obligation from the notice perspective operate in the same general manner as notice of a bond election in the sense that the notice has to be published in a paper of general circulation in the jurisdiction.
and the statesman is -- has routinely been where we've published notices for cos in the past and works for that purpose.
there are some requirements under the law that the paper meet certain requirements to be -- to be available for notice, and the statesman meets those.
>> you've got other publications in the area and, of course, I want to make sure that those that may feel that they've been left out, that's not the case according to what we're doing here now as far as the selection of the american statesman to carry that particular notification.
>> and that is -- Commissioner Davis, that has been the standard practice for the last 20 -- almost 20 years.
>> Commissioner Davis, in my time at the attorney general's office, we had to answer that question and most of those other newspapers do not meet the statutory requirement of being a general circulation within the jurisdiction.
>> well, I just wanted to make sure that those are listening out there that -- they understand that.
>> what's the recommendation from the planning and budget office?
>> the recommendation, judge, is to authorize the issuance of the 22.5 million and associated costs as taxable and then to issue the balance as tax exempt.
and that the amount in the order would be --
>> exactly 45.
we had to round up in case there is premium.
the recommendation is just proceed with the notice.
>> okay.
>> and judge, we intend to go forward with the sale in the same manner we did last year because kind of the market has settled down quite a bit.
we're back to a rate structure that were like they were when we did the refunding in October.
that big hump in rates has come back down.
if we sold on the normal 23 and a half debt, so that's good.
almost the same at search and rescue.
rescue -- 700 lavaca.
with world events, we would rather go ahead and sell the bonds on a negotiated basis like we did last year, which is the plan.
>> I'm looking at the proposed resolution and exhibit a.
is there a exhibit b also?
a adds up to less than $3 million.
we're about to authorize 45 million.
looks like I'm looking at --
>> were you looking at the reimbursement resolution, sir?
>> I'm looking at the resolution expressing attempt to finance expenditures to be incurred.
>> exhibit a, judge, of this particular item is the notice of intent to issue certificates of obligation.
>> right.
I believe you are looking at the reimbursement resolution, sir, which is item number 8.
>> let me look in my backup for that then.
okay.
>> exhibit a of the notice of intent has 45 million and it has a description of every project.
we've categorized every project with the description.
>> should we call up 8 -- we've approved 8.
>> 8 was a reimbursement resolution and that has already been approved.
>> okay, so we have exhibit -- so where does 6 pick up the rest of the $45 million?
>> the $45 million is-was an item that was approved back in January on January 25th, and that included your voter approved bonds, which was 5.6 million, which we do not have to issue any kind of notice to proceed on.
those have already been approved by voters.
44.5 million that includes projects such as land for the courthouse, a portion of the financial system, 700 lavaca, due diligence, sheriff's projects, t.n.r.
projects such as hmac and vehicles, e.m.s., ambulances, et cetera.
I can provide that list to you again.
>> I have it.
it's under 8.
I guess my concern is in 6 we're just giving notice of the less than $3 million.
>> no, sir.
in item number 6, exhibit a, it's a $45 million notice.
>> that's back to my original point.
my exhibit a only has less than $3 million.
>> sorry about that, judge.
the exhibit a --
>> this is backue
>> for 6.
>> the $3 million item was item number 8, which is court has approved.
>> okay.
>> which in the future we will not post the same day.
>> we'll just put it all on one item, I guess.
it's just I was looking -- I think I understand now.
but exhibit a only has less than $3 million.
the rest of it is in the -- another exhibit a.
we have two exhibit as.
>> for two different items. That's correct.
>> exhibit a for item 6, the notice of intent to issue co.
of merits, has $45 million.
the exhibit a to your reimbursement resolution will identify a very small subset of projects for which you seek to reimburse -- you are going to go ahead and use existing funds and then reimburse from bond proceeds later.
and that should be 3 million and should have a smaller number.
>> 2.7 million and it was also listed in the budget amendments today.
>> any our discussion?
>> move approval.
>> second.
>> the motion is to issue tax exempt funds on the --
>> the action item is to approve the notice to authorize the publication of intention.
in the form attached to the order.
>> because it has those types -- that flexibility.
>> correct.
>> on the land that would be taxable.
>> yes, sir.
>> the rest of it would be our usual tax exempt funds.
>> yes, sir.
>> discussion?
all in favor?
that passes by unanimous vote.
>> thank you all.
>> thank you.
>> thank you, judge.
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Last Modified:
Tuesday, March 22, 2011 6:49 PM
