10, 2020 ON NG NANCI SI VI AUGUST Y DI I F T RE CI RE - - PDF document

CI T Y DI VI SI ON RE F I NANCI NG AUGUST 10, 2020

RE VI E W OF L E ASE BONDS

• Pha se 1 – 2020 Re fina nc ing :
• 51% o f L

e a se de b t will b e b a se d o n ne w L e a se a g re e me nt

• Se rie s A ta x-e xe mpt b o nds b e c o me ta xa b le (due to ne w tax

law re stric tio ns)

• Co nve rsio n to ta xa b le b o nds wo rks due to ne a r-histo ric

lo w inte re st ra te s

• Pha se 2 – 2023 Optio na l Re fina nc ing :
• Re ma ining Se rie s A b o nds a re c a lla b le in 2023
• Allo ws re funding a s ta x-e xe mpt b o nds
• Assume s b o nd ma rke t / inte re st ra te s re ma in fa vo ra b le

Bond Se rie s E xisting De bt

2013 Se rie s A – ta x e xe mpt, c a lla b le in 2023 $245.6 M 2013 Se rie s B – no n-c a lla b le , ze ro c o upo n $64.3 M 2018 F ulto n L

• a n – re fina nc ing o f 2013 Se rie s C b o nds – ta xa b le

$17.9 M

T OT AL $327.8 M

PURPOSE OF F I NANCI NG (SUMMARY)

Se ttle a ll o utsta nding dispute s b e twe e n L CA a nd Alle nto wn E xte nd the ma turity o f the L CA de b t to a mo re ma na g e a b le le ve l Re a lize inte re st ra te sa ving s

3

HOW GOAL S WI L L BE RE AL I ZE D

Re fina nc e a portion of the e xisting de bt so 51% of the L CA Bonds

• utsta nding a re issue d in 2020.
• Allo ws c ha ng e s to the Co nc e ssio n L

e a se Ag re e me nt to mo ve a he a d

• Give n ta x la w c o nstra ints, the pro po se d

Se rie s o f 2020 will b e issue d with ta xa b le inte re st ra te s

E xte nd F ina l Ma turity

• Curre nt de b t – 2047
• Pro po se d de b t – 2059

Produc e Inte re st Ra te Sa ving s

• E

xisting ra te o n Se rie s o f 2013 A – 5.45%

• Curre nt pro je c te d b o rro wing ra te – 3.39%

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SUMMARY OF I MPACT S: 2020 RE F I NANCI NG

 2020-2030  de b t se rvic e re duc e d $19.8 M  2031-2040  de b t se rvic e re duc e d $51.8 M  2041-2050  de b t se rvic e re duc e d $30.3 M  31- Ye a r De bt Se rvic e Re duc tion = $101.9 M T

• ta l

 2051-2059  de b t se rvic e inc re a se d $147.1 M  T

• ta l De bt Se rvic e Impa c t = $45.2 M

 Ne t Pre se nt Va lue of Diffe re nc e = $13 M

S

• urc e : Data pro vide d by Co nc o rd Public F

inanc e

DE BT SE RVI CE AF T E R RE F I NANCE

S

• urc e : Data pro vide d by

Co nc o rd Public F inanc e

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Fiscal Existing Resulting Cumulative Year Debt Service Debt Service Difference Difference 2020 15,125,388 12,583,586 2,541,801.33 2,541,801.33 2021 15,605,025 13,873,768 1,731,257.50 4,273,058.83 2022 16,107,525 14,376,843 1,730,682.50 6,003,741.33 2023 16,622,650 14,893,518 1,729,132.50 7,732,873.83 2024 17,155,400 15,423,793 1,731,607.50 9,464,481.33 2025 17,705,775 15,972,843 1,732,932.50 11,197,413.83 2026 18,273,538 16,540,493 1,733,045.00 12,930,458.83 2027 18,863,688 17,131,743 1,731,945.00 14,662,403.83 2028 19,475,988 17,746,418 1,729,570.00 16,391,973.83 2029 20,111,713 18,379,343 1,732,370.00 18,124,343.83 2030 20,760,913 19,030,693 1,730,220.00 19,854,563.83 2031 21,439,588 19,705,793 1,733,795.00 21,588,358.83 2032 22,142,413 20,412,718 1,729,695.00 23,318,053.83 2033 22,863,738 21,133,468 1,730,270.00 25,048,323.83 2034 22,448,238 20,883,043 1,565,195.00 26,613,518.83 2035 27,713,238 23,008,043 4,705,195.00 31,318,713.83 2036 29,236,238 24,463,043 4,773,195.00 36,091,908.83 2037 30,797,988 26,013,043 4,784,945.00 40,876,853.83 2038 32,295,738 27,018,043 5,277,695.00 46,154,548.83 2039 33,374,988 20,918,043 12,456,945.00 58,611,493.83 2040 34,525,738 21,454,043 13,071,695.00 71,683,188.83 2041 35,714,738 22,003,043 13,711,695.00 85,394,883.83 2042 36,949,488 22,576,793 14,372,695.00 99,767,578.83 2043 38,221,738 23,171,293 15,050,445.00 114,818,023.83 2044 27,998,238 18,912,543 9,085,695.00 123,903,718.83 2045 27,998,331 18,916,129 9,082,202.50 132,985,921.33 2046 27,998,206 18,916,164 9,082,042.50 142,067,963.83 2047 27,994,788 18,915,735 9,079,052.50 151,147,016.33 2048 16,363,820 (16,363,820.00) 134,783,196.33 2049 16,361,020 (16,361,020.00) 118,422,176.33 2050 16,362,020 (16,362,020.00) 102,060,156.33 2051 16,361,340 (16,361,340.00) 85,698,816.33 2052 16,365,488 (16,365,487.50) 69,333,328.83 2053 16,360,900 (16,360,900.00) 52,972,428.83 2054 16,362,410 (16,362,410.00) 36,610,018.83 2055 16,364,348 (16,364,347.50) 20,245,671.33 2056 16,361,210 (16,361,210.00) 3,884,461.33 2057 16,368,378 (16,368,377.50) (12,483,916.17) 2058 16,368,295 (16,368,295.00) (28,852,211.17) 2059 16,360,618 (16,360,617.50) (45,212,828.67) Totals 695,521,025 740,733,854 (45,212,828.7) (45,212,828.7) Net present value of difference 12,994,406.41 Fiscal Existing Resulting Cumulative Year Debt Service Debt Service Difference Difference 2020 15,125,388 12,583,586 2,541,801.33 2,541,801.33 2021 15,605,025 13,873,768 1,731,257.50 4,273,058.83 2022 16,107,525 14,376,843 1,730,682.50 6,003,741.33 2023 16,622,650 14,893,518 1,729,132.50 7,732,873.83 2024 17,155,400 15,423,793 1,731,607.50 9,464,481.33 2025 17,705,775 15,972,843 1,732,932.50 11,197,413.83 2026 18,273,538 16,540,493 1,733,045.00 12,930,458.83 2027 18,863,688 17,131,743 1,731,945.00 14,662,403.83 2028 19,475,988 17,746,418 1,729,570.00 16,391,973.83 2029 20,111,713 18,379,343 1,732,370.00 18,124,343.83 2030 20,760,913 19,030,693 1,730,220.00 19,854,563.83 2031 21,439,588 19,705,793 1,733,795.00 21,588,358.83 2032 22,142,413 20,412,718 1,729,695.00 23,318,053.83 2033 22,863,738 21,133,468 1,730,270.00 25,048,323.83 2034 22,448,238 20,883,043 1,565,195.00 26,613,518.83 2035 27,713,238 23,008,043 4,705,195.00 31,318,713.83 2036 29,236,238 24,463,043 4,773,195.00 36,091,908.83 2037 30,797,988 26,013,043 4,784,945.00 40,876,853.83 2038 32,295,738 27,018,043 5,277,695.00 46,154,548.83 2039 33,374,988 20,918,043 12,456,945.00 58,611,493.83 2040 34,525,738 21,454,043 13,071,695.00 71,683,188.83 2041 35,714,738 22,003,043 13,711,695.00 85,394,883.83 2042 36,949,488 22,576,793 14,372,695.00 99,767,578.83 2043 38,221,738 23,171,293 15,050,445.00 114,818,023.83 2044 27,998,238 18,912,543 9,085,695.00 123,903,718.83 2045 27,998,331 18,916,129 9,082,202.50 132,985,921.33 2046 27,998,206 18,916,164 9,082,042.50 142,067,963.83 2047 27,994,788 18,915,735 9,079,052.50 151,147,016.33 2048 16,363,820 (16,363,820.00) 134,783,196.33 2049 16,361,020 (16,361,020.00) 118,422,176.33 2050 16,362,020 (16,362,020.00) 102,060,156.33 2051 16,361,340 (16,361,340.00) 85,698,816.33 2052 16,365,488 (16,365,487.50) 69,333,328.83 2053 16,360,900 (16,360,900.00) 52,972,428.83 2054 16,362,410 (16,362,410.00) 36,610,018.83 2055 16,364,348 (16,364,347.50) 20,245,671.33 2056 16,361,210 (16,361,210.00) 3,884,461.33 2057 16,368,378 (16,368,377.50) (12,483,916.17) 2058 16,368,295 (16,368,295.00) (28,852,211.17) 2059 16,360,618 (16,360,617.50) (45,212,828.67) Totals 695,521,025 740,733,854 (45,212,828.7) (45,212,828.7) Net present value of difference 12,994,406.41

S

• urc e : Data pro vide d by Co nc o rd Public F

inanc e

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2,500,000 5,000,000 7,500,000 10,000,000 12,500,000 15,000,000 17,500,000 20,000,000 22,500,000 25,000,000 27,500,000 30,000,000 32,500,000 35,000,000 37,500,000 40,000,000

Lehigh County Authority (City of Allentown Concession) Comparison of Existing and Resulting Debt Service

Existing Debt Service Resulting Debt Service

MAJOR MI L E ST ONE S I N PL AN OF F I NANCE



L CA Bo a rd a ppro va l o f Ag re e me nts



Appra isa l o f e xisting Co nc e ssio ne d Syste m



E ng ine e r’ s re po rt re vie wing pro po se d c a sh flo ws



Munic ipa l Bo nd Ra ting pro vide d (Aug ust 12, 2020)



Alle nto wn City Co unc il c o nside rs a ppro va l o f Ag re e me nts (Aug ust 12, 2020)



Ob ta in munic ipa l b o nd insura nc e q uo te s – re duc e s L CA’ s c o st o f c a pita l (Aug ust 13, 2020)



Distrib ute Pre limina ry Offic ia l Sta te me nt (Aug ust 14, 2020)



L CA Bo a rd c o nside rs pa ssa g e o f Bo rro wing Pa ra me te rs Re so lutio n (Aug ust 24, 2020)



Bo nds Pric e d a nd inte re st ra te s se t (Se pte mb e r 2, 2020)



Se ttle me nt o f F ina nc ing (Se pte mb e r 17, 2020)



L CA o pe ra te s syste m unde r re vise d Ag re e me nts (Oc to b e r 1, 2020 ra te e ffe c tive da te ; Ja nua ry 1, 2021

• the r te rms o f a g re e me nt)

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BORROWI NG PARAME T E RS RE SOL UT I ON (8/ 24/ 2020)

Bo a rd Cha ir, Vic e Cha ir, CE O a nd CF O a utho rize d to sig n the Bo nd Purc ha se Ag re e me nt with Unde rwrite r (sc he dule d fo r Se pte mb e r 2) so lo ng a s the fo llo wing pa ra me te rs a re me t:



Ma ximum b o rro wing a mo unt – no t g re a te r tha n $225,000,000.



Ma ximum o ve ra ll inte re st ra te – no t g re a te r tha n 3.75%. *I t is a ntic ipa te d the numb e rs will b e lo we r. 9

F I NANCI NG PART I CI PANT S

 F

ina nc ia l Advisor – Co nc o rd Pub lic F

ina nc ia l Adviso rs, I nc .

 Bond Counse l – Mc Ne e s Wa lla c e & Nuric k L

L C

 Authority Counse l – K

ing , Spry, He rma n, F re und & F a ul L L C

 Unde rwrite rs –  RBC Ca pita l Ma rke ts  Ja nne y Mo ntg o me ry Sc o tt L

L C

 Unde rwrite rs’ Counse l – Ste ve ns & L

e e , P.C.

 Bond T

r uste e – M&T

Ba nk

 Authority E

ng ine e r – Arc a dis, U.S., I

nc .

 Syste m Appra ise r -- AUS Co nsulta nts

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QUE ST I ONS / DI SCUSSI ON

T ha nk you!