At the Nolan County Commissioners meeting on Tuesday, November 13, one of the items on the agenda was to receive information on the issuance of bonds toward the proposals that appeared on the November 6, 2012 ballot, while also authorizing a specific plan of action.
Thus, the General Obligation Financings plan was presented during the regular meeting, which was held at the county courthouse. Making the presentation was Vince Viaille, the managing director at Specialized Public Finance, Inc. (SPFI), the company selected to provide financial advisory services to the county for their renovation and construction projects.
A summary was presented at the meeting, as Nolan County has the choice to name the General Obligation bonds as "bank qualified" or "non-bank qualified."
To be "bank-qualified", or BQ, the county cannot issue more than $10 million in tax-exempt debt in a calendar year. Also counted toward the $10 million limit would be capital leases and operating loans as long as they are tax-exempt.
BQ bonds, if purchased, allow banks to receive favorable treatment, which increases the pool of buyers and lowers the overall interest rate--in comparison to a non-BQ designated bond issue.
According to current estimates from SPFI, a benefit of approximately $765,000 in total debt service savings would be seen in issuing BQ General Obligation bonds in 2012 and 2013, versus one non-BQ issue.
A preliminary timeline of events on the negotiated sale was presented as well. The meeting on Tuesday allowed for the county commissioners to authorize SPFI to proceed with their actions; the following day, elections would be canvassed by the commissioners court.
On Friday, November 16, the draft official statement will be distributed by SPFI to their financing team, in which the financial advisor will make the application to Standard & Poor's, or the S&P.
The POS comments will be due on Tuesday, November 20. If necessary, a call with the S&P for a rating update will take place on Monday, November 26.
Three days later--on Thursday, November 26, the rating from S&P should be received and distributed by the SPFI. Thereafter, the month of December brings about three vital actions.
On Thursday, December 6, interest rates on the bonds will be negotiated between the underwriter and SPFI for pricing. At the next county commissioners meeting, tentatively slated for Monday, December 10, an order authorizing the issuance of the bonds will be considered.
The final step, which should take place anytime after December 14 but before December 31, will be the delivery date, in which the county closes and funds are deposited to the construction fund.