CALUMET COUNTY, WISCONSIN PRESENTATION TO ADMINISTRATIVE SERVICES - - PowerPoint PPT Presentation

CALUMET COUNTY, WISCONSIN PRESENTATION TO ADMINISTRATIVE SERVICES COMMITTEE

BONDING PROGRAM FOR CAPITAL IMPROVEMENT PROJECTS 2018 GENERAL OBLIGATION NOTES DATED: AUGUST 14, 2018

══════════ PREPARED BY: ══════════

CAROL ANN WIRTH, PRESIDENT

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Calumet County Bonding Program

• Analyze Potential Tax Impact of Existing Debt and Future Debt Issues
• Combined Debt Service
• Estimated Mill Rate
• Assumptions Used for Program:
• Tax Base Growth
• 2017 Actual Equalized Valuation
• 2018 “Preliminary” Actual Equalized Valuation
• 3% cumulative increase for 3 years; 0% thereafter
• Debt
• Existing - 4 Outstanding Issues
• 2018 Issue: $2,945,000 for Capital Improvement Projects
• Potential Future Project / Issues: $25 Million Jail Project

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2018 General Obligation Promissory Notes

• Purposes: 2017 Budget Capital Improvement Projects

Courthouse Chiller - $146,794

CTH AP (Lake Park - Coop) Overlay - $298,335 Furniture Replacement - $22,312 CTH BB (CTH B - USH 10) Pulverize/Pave - $629,222 Roof Jail Addition Replacement - $72,359 CTH C (USH 151 - CTH H) Overlay - $218,245 County Park Property Acquisition - $1,507,267 CTH LP (USH 10 - CTH AP) RAB Concrete Urban - $50,000

• Authority to Borrow

Resolution 2014-26 Adopted November 3, 2014 Authorizing General Obligation Bonds and/or Promissory Notes in an Amount Not to Exceed $46 Million for the public purpose of paying the cost of the County’s Outlays and Capital Improvement Program for the years 2015 through 2019. Requires approval by ¾ of County Board members elect. Adopted unanimously by all County Board members present (20).

• Levy Limits - Do not apply to debt service on general obligation debt authorized after July 1, 2005
• County Prepares to Access the Municipal Bond Market

Review and approve amortization - Determine method of sale Prepare Official Statement - SEC required disclosure document Bond rating application - S&P Global Ratings (AA+ assigned in 2015, reaffirmed in 2016) County also has outstanding rating from Moody’s Investors Service (Aa2) on 2010 Notes only

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2018 General Obligation Promissory Notes

Sources Of Funds

2018 G.O. Notes $2,945,000.00 Reoffering Premium from Investors Est. 69,130.15 Total Sources $3,014,130.15

Uses Of Funds

• Est. Issuance Expenses Paid by Underwriter - Municipal Advisor, Bond Counsel, Rating, Underwriting

64,420.00 Capital Improvement Project Funding 2,945,000.00 Excess Premium - Deposit to Debt Service Est. 4,710.15 Total Uses $3,014,130.15

$2,945,000 General Obligation Promissory Notes (2018) Est. Debt Service

Calendar Year Principal (12/01) Rates Estimated Interest Total Est. Debt Service

2018

• 2019

100,000.00 3.000% 88,112.33 188,112.33 2020 100,000.00 3.000% 82,270.00 182,270.00 2021 330,000.00 3.000% 79,270.00 409,270.00 2022 330,000.00 3.000% 69,370.00 399,370.00 2023 350,000.00 3.000% 59,470.00 409,470.00 2024 385,000.00 3.000% 48,970.00 433,970.00 2025 400,000.00 3.000% 37,420.00 437,420.00 2026 470,000.00 2.600% 25,420.00 495,420.00 2027 480,000.00 2.750% 13,200.00 493,200.00

• $2,945,000.00

TIC 2.82% $503,502.33 $3,448,502.33

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$2,945,000 G.O. Notes Preliminary Pricing Summary - Market of August 6, 2018

Maturity Type of Bond Rates Yield Maturity Value Price Dollar Price

12/01/2019 Serial Coupon 3.000% 1.750% 100,000.00 101.274% 101,274.00 12/01/2020 Serial Coupon 3.000% 1.850% 100,000.00 102.284% 102,284.00 12/01/2021 Serial Coupon 3.000% 1.950% 330,000.00 103.077% 340,154.10 12/01/2022 Serial Coupon 3.000% 2.050% 330,000.00 103.659% 342,074.70 12/01/2023 Serial Coupon 3.000% 2.150% 350,000.00 104.033% 364,115.50 12/01/2024 Serial Coupon 3.000% 2.300% 385,000.00 103.921% 400,095.85 12/01/2025 Serial Coupon 3.000% 2.450% 400,000.00 103.533% 414,132.00 12/01/2026 Serial Coupon 2.600% 2.600% 470,000.00 100.000% 470,000.00 12/01/2027 Serial Coupon 2.750% 2.750% 480,000.00 100.000% 480,000.00 Total

• $2,945,000.00
• $3,014,130.15

Par Amount of Notes $2,945,000.00 Reoffering Premium Est. 69,130.15 Sub-Total $3,014,130.15 Issuance Expenses Paid by Underwriter (Est.) $(64,420.00) Total Paid to County $2,949,710.15 True Interest Cost (TIC) 2.8265273%

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Method of Sale

Wisconsin Law allows General Obligation Notes and Refunding Bonds to be sold at Public or Negotiated Sale Public Sale – County Advertises for Underwriter Nation-wide – to Submit Bid on Specific Date and Time Underwriter’s Bid Dependent Upon – Market Conditions on Day of Bid Number of Issues Underwriter Will Bid on (Bidding Calendar) or Purchase That Day Limited Ability to Pre-sell Notes/Bonds - Risk May be Built into Bid as Cost to County Underwriting Cost Locked in on the Day of Sale Underwriter Submits Bid on Bid Form per Bidding Parameters in “Official Notice of Sale” Market Conditions are Monitored by Municipal Advisor Throughout Borrowing Timeline Local Banks Participate Through Their Broker/Dealer Relationships County May Change Dollar Amount and Structure with Approval of Successful Bidder on Sale Date Negotiated Sale – Underwriter is Selected By County Through an RFP Process Underwriter Provides Assistance to County in Advance of Entering the Bond Market - Updates and Advises County of Changes to Market Conditions, Interest Rates Investors and Local Banks Contacted Early to Determine Interest in Purchasing Notes/Bonds Reduces Underwriter’s Risk of Unsold Notes/Bonds - Potential for Lower Underwriting Cost Cost of Underwriting Locked in Prior to Sale Date Underwriter Has Flexibility to Capture Market Opportunities Several Days in Advance of Award County May Change Dollar Amount and Structuring Terms Up to Time of Order Period Underwriter Provides County with Comparable Sales in Market RFP Process: Municipal Advisor assists with the preparation and distribution of RFP to at least three qualified

• underwriters. Underwriters’ responses are analyzed and selection is made based on lowest overall cost to the

County including interest rate and underwriting compensation and expenses. The County has historically used the Negotiated Sale method

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Timeline for 2018 G.O. Notes

August 14 Presentation to Administrative Committee Motion to Proceed August 21 Presentation to County Board Meeting Coordinate Financing Team - Municipal Advisor, Bond Counsel, Underwriter Prepare for Market Entry - Official Statement / S&P Rating Presentation October 10 Official Statement Completed October 18-19 S&P Global Rating Call October 30 Rating and Report Released November 5 County Board Adopts Final Award Resolution (Requires Majority Vote) Locks in Interest Rates and Tax Levy November 19 Closing – Delivery of Funds

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Potential Future Project / Issues

• $25 Million Jail Project
• Preliminary Assumptions – Project Timeline
• 2019 – Complete Design and Bid Documents
• 2020 – Construction Commences
• Preliminary Assumptions - 3 Phase Financing – General Obligation Bonds
• 2019 - $ 5 million @ 3.75% - 20 Year Repayment
• 2020 - $10 million @ 4.00% - 20 Year Repayment
• 2021 - $10 million @ 4.00% - 20 Year Repayment

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$25 Million General Obligation Bonds Est. Combined Debt Service-3 Phases

Calendar Year Principal Estimated Interest Total Combined

• Est. Debt Service

2019

• 2020
• 187,500.00

187,500.00 2021

• 587,500.00

587,500.00 2022

• 987,500.00

987,500.00 2023

• 987,500.00

987,500.00 2024 235,000.00 987,500.00 1,222,500.00 2025 245,000.00 978,687.50 1,223,687.50 2026 710,000.00 969,500.00 1,679,500.00 2027 740,000.00 941,725.00 1,681,725.00 2028 1,265,000.00 912,775.00 2,177,775.00 2029 1,315,000.00 862,850.00 2,177,850.00 2030 1,365,000.00 810,950.00 2,175,950.00 2031 1,425,000.00 757,075.00 2,182,075.00 2032 1,480,000.00 700,837.50 2,180,837.50 2033 1,535,000.00 642,425.00 2,177,425.00 2034 1,600,000.00 581,837.50 2,181,837.50 2035 1,660,000.00 518,687.50 2,178,687.50 2036 1,725,000.00 453,162.50 2,178,162.50 2037 1,790,000.00 385,075.00 2,175,075.00 2038 1,865,000.00 314,412.50 2,179,412.50 2039 1,935,000.00 240,787.50 2,175,787.50 2040 2,015,000.00 164,400.00 2,179,400.00 2041 2,095,000.00 83,800.00 2,178,800.00

• $25,000,000.00

$14,056,487.50 $39,056,487.50

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Projected Combined With Combined Budget Equalized $25 Million - 3 Phase Estimated Existing & 2018 Notes Estimated Year Valuations (TID OUT) Estimated Debt Service Mill Rate

• Est. Debt Service

Mill Rate 2019 3,900,630,100 0.000 2,656,057 0.681 2020 4,017,649,003 187,500 0.047 2,837,165 0.706 2021 4,138,178,473 587,500 0.142 3,005,720 0.726 2022 4,262,323,827 987,500 0.232 3,398,270 0.797 2023 4,262,323,827 987,500 0.232 3,395,420 0.797 2024 4,262,323,827 1,222,500 0.287 3,180,570 0.746 2025 4,262,323,827 1,223,687 0.287 3,180,907 0.746 2026 4,262,323,827 1,679,500 0.394 2,174,920 0.510 2027 4,262,323,827 1,681,725 0.395 2,174,925 0.510 2028 4,262,323,827 2,177,775 0.511 2,177,775 0.511 2029 4,262,323,827 2,177,850 0.511 2,177,850 0.511 2030 4,262,323,827 2,175,950 0.511 2,175,950 0.511 2031 4,262,323,827 2,182,075 0.512 2,182,075 0.512 2032 4,262,323,827 2,180,837 0.512 2,180,837 0.512 2033 4,262,323,827 2,177,425 0.511 2,177,425 0.511 2034 4,262,323,827 2,181,838 0.512 2,181,838 0.512 2035 4,262,323,827 2,178,688 0.511 2,178,688 0.511 2036 4,262,323,827 2,178,162 0.511 2,178,162 0.511 2037 4,262,323,827 2,175,075 0.510 2,175,075 0.510 2038 4,262,323,827 2,179,412 0.511 2,179,412 0.511 2039 4,262,323,827 2,175,788 0.510 2,175,788 0.510 2040 4,262,323,827 2,179,400 0.511 2,179,400 0.511 2041 4,262,323,827 2,178,800 0.511 2,178,800 0.511 Total $39,056,487 56,503,029 Estimated Interest Rate 3.75 - 4.0% $25,000,000 G.O. Bonds and Estimated Tax Impact