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Home My WebLink About2015/03/16 RESOLUTION OF THE COUNTY OF HARNETT BOC AUTHORIZING THE NEGOTIATION OF AN AMENDMENT TO AN INSTALLMENT CONTRACT TO REFINANCE PURCHASE OF REAL & PERSONAL PROPERTYEXTRACTS FROM MINUTES OF BOARD OF COMMISSIONERS A regular meeting of the Board of Commissioners (the "Board") of the County of Harnett, North Carolina (the '`County") was held on Monday, March 16, 2015, at 7:00 p.m. in the County Commissioners' Meeting Room, Harnett County Administration Building, 102 East Front Street, Lillington, North Carolina, Jim Burgin, Chairman of the Board presiding and the following Commissioners present: Jim Burgin, Chairman Gordon Springle, Vice - Chairman Abe Elmore, Commissioner Barbara McKoy, Commissioner Joe Miller, Commissioner Commissioners absent: n/a Also present: Joseph Jeffries, Interim County Manager Paula Stewart, Interim Deputy County Manager Dwight Snow, County Attorney Kimberly Honeycutt, Finance Officer Margaret Regina Wheeler, Clerk s s s s s s Vice Chairman Springle moved that the following resolution (the "Resolution "), a copy of which was available with the Board and which was read by title: RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE COUNTY OF HARNETT, NORTH CAROLINA, AUTHORIZING THE NEGOTIATION OF AN AMENDMENT TO AN INSTALLMENT PURCHASE CONTRACT AND PROVIDING FOR CERTAIN OTHER RELATED MATTERS THERETO WHEREAS, the County of Harnett, North Carolina (the "County") is a validly existing political subdivision of the State of North Carolina, existing as such under and by virtue of the Constitution, statutes and laws of the State of North Carolina (the "State"); WHEREAS, the County has the power pursuant to the General Statutes of North Carolina to (1) purchase real and personal property, (2) enter into installment financing contracts in order to finance and refinance the purchase of real and personal property used, or to be used, for public purposes and (3) grant a security interest in some or all of the property purchased to secure repayment of the purchase price; WHEREAS, the County previously executed and delivered an Installment Purchase Contract dated as of April 15, 2007 (the "2007 Contract") between the County and Hamett County Public Facilities Corporation (the "Corporation ") to finance, in part, (1) the construction, furnishing and equipping of a new elementary school to be known as Overhills Elementary School, (2) the construction, furnishing and equipping a jail and law enforcement center (the "Law Enforcement Facilhy'), (3) the construction of a gymnasium at Coats Elementary School, and (4) the construction of a solid waste transfer station (collectively, the "2007 Projects "); PPAB 2729801 v4 WHEREAS, in order to secure its obligations under the 2007 Contract, the County executed and delivered a Deed of Trust and Security Agreement dated as of April 15, 2007 from the County to the deed of trust trustee named therein, granting a lien on the real property on which the Law Enforcement Facility and Overhills Elementary School are located and all improvements thereon; WHEREAS, the Corporation previously executed and delivered its Certificates of Participation, Series 2007 (the "2007 Certificates "), evidencing proportionate undivided interests in rights to receive certain revenues (the "Revenues ") pursuant to the 2007 Contract under an Indenture of Trust dated as of April 15, 2007 (the "Genera/ Indenture "), as supplemented by Supplemental Indenture, Number I dated as of April 15, 2007, each between the Corporation and Regions Bank, as trustee; WHEREAS, the Board of Commissioners of the County (the "Board") hereby determines that it is in the best interests of the County to enter into Amendment Number One to the Installment Purchase Contract (the "Contract Amendment," and together with the 2007 Contract, the "Contract') between the County and the Corporation in order to refinance the County's installment payment obligations under the Contract corresponding to the 2007 Certificates maturing on and after December 1, 2018 (collectively, the "Refunded Certificates "); WHEREAS, in order to accomplish the refinancing, the County staff and Davenport & Company, LLC, as the County's financial advisor, have solicited requests for proposals from financial institutions to purchase a refunding certificate of participation, evidencing proportionate undivided interests in rights to receive certain Revenues pursuant to the Contract, to be executed and delivered by the Corporation as an Additional Certificate under the General Indenture (the "2015 Certificate"); WHEREAS, the Board has previously determined that (1) the acquisition of the 2007 Projects is essential to the County's proper, efficient, and economic operation and to the general health and welfare of its inhabitants and (2) the 2007 Projects will provide an essential use and will permit the County to carry out public functions that it is authorized by law to perform; WHEREAS, the Board hereby determines that entering into the Contract Amendment is necessary and expedient for the County by virtue of the findings presented herein; WHEREAS, the County hereby determines that the Contract Amendment allows the County to refinance the Refunded Certificates at a favorable interest rate currently available in the financial marketplace and on terms advantageous to the County; WHEREAS, the County hereby determines that the estimated cost of refinancing the Refunded Certificates exceeds the amount that can be prudently raised from currently available appropriations, unappropriated fund balances and non -voted bonds that could be issued by the County in the current fiscal year pursuant to Article V, Section 4 of the Constitution of the State; WHEREAS, although the cost of refinancing the Refunded Certificates pursuant to the Contract Amendment is expected to exceed the cost of refinancing the Refunded Certificates pursuant to a bond financing for the same undertaking, the County hereby determines that the cost of refinancing the Refunded Certificates pursuant to the Contract Amendment and the obligations of the County thereunder are preferable to a general obligation bond financing or revenue bond financing for several reasons, including but not limited to the following: (1) the cost of a special election necessary to approve a general obligation bond financing, as required by the laws of the State, would result in the expenditure of significant funds; (2) the time required for a general obligation bond election would cause an unnecessary delay which would thereby decrease the financial benefits of refinancing the Refunded Certificates; and (3) insufficient revenues are produced by the 2007 Projects so as to permit a revenue bond financing; PPAB 2729801 v4 WHEREAS, the County has determined and hereby determines that the estimated cost of refinancing the Refunded Certificates pursuant to the Contract Amendment reasonably compares with an estimate of similar costs under a bond financing for the same undertaking as a result of the findings delineated in the above preambles; WHEREAS, the County does not anticipate a future property tax increase to pay Installment Payments falling due under the Contract; WHEREAS, the sums to fall due under the Contract will be adequate but not excessive for its proposed purpose; WHEREAS, Parker Poe Adams & Bernstein LLP, as special counsel, will render an opinion to the effect that entering into the Contract and the transactions contemplated thereby are authorized by law; WHEREAS, no deficiency judgment may be rendered against the County in any action for its breach of the Contract, and the taxing power of the County is not and may not be pledged in any way directly or indirectly or contingently to secure any moneys due under the Contract; WHEREAS, the County is not in default under any of its debt service obligations; WHEREAS, the County's budget process and Annual Budget Ordinance are in compliance with the Local Government Budget and Fiscal Control Act, and external auditors have determined that the County has conformed with generally accepted accounting principles as applied to governmental units in preparing its Annual Budget ordinance; WHEREAS, past audit reports of the County indicate that its debt management and contract obligation payment policies have been carried out in strict compliance with the law, and the County has not been censured by the North Carolina Local Government Commission (the "Commission "), external auditors or any other regulatory agencies in connection with such debt management and contract obligation payment policies; WHEREAS, the Board hereby reaffirms each of the findings it made with respect to the 2007 Contract and the 2007 Projects in the resolution adopted by the Board on February 5, 2007; and WHEREAS, the County must obtain the Commission's approval to enter into the Contract Amendment; NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE COUNTY OFHARNETT, NORTH CAROLINA, AS FOLLOWS. Section 1. Authorization to Negotiate Contract Amendment The County Manager, the Finance Officer and their designees, with advice from the County Attorney and Special Counsel, are hereby authorized and directed to negotiate on behalf of the County for the refinancing of the Refunded Certificates under the Contract Amendment in a principal amount not to exceed $31,000,000, to be entered into in accordance with the provisions of Section 160A -20 of the General Statutes of North Carolina. All actions of the County, the County Manager, the Finance Officer, the Clerk to the Board, the County Attorney and their respective designees, whether previously or hereinafter taken, in effectuating the proposed refinancing in a manner consistent with this Resolution are hereby approved, ratified and authorized. PPAB 2729801 A Section 2. Application to the Commission. The Finance Officer or her designee is hereby directed to file with the Commission an application for its approval of the Contract Amendment and all relevant transactions contemplated thereby on a form prescribed by the Commission and to state in such application such facts and to attach thereto such exhibits regarding the County and its financial condition as may be required by the Commission. Section 3. Financing Team. The County Manager and the Finance Officer, with advice from the County Attorney, are hereby authorized and directed (1) to retain the assistance of Parker Poe Adams & Bernstein LLP, as special counsel, and Davenport & Company LLC, as financial advisor, and (2) to select Regions Capital Advantage, Inc. as the initial purchaser of the 2015 Certificate. Section 4. Repealer. All motions, orders, resolutions and parts thereof in conflict herewith are hereby repealed. Section 5. Effective Date. This Resolution is effective on the date of its adoption. On motion of Vice Chairman Springle, seconded by Commissioner McKoy, the foregoing resolution entitled "RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE COUNTY OF HARNETT, NORTH CAROLINA, AUTHORIZING THE NEGOTIATION OF AN AMENDMENT TO AN INSTALLMENT PURCHASE CONTRACT AND PROVIDING FOR CERTAIN OTHER RELATED MATTERS THERETO" Was duly adopted by the following vote: AYES: 5 NAYS: 0 PPAB 2729801 v4 STATE OF NORTH CAROLINA ss: COUNTY OF HARNETT I, MARGARET REGINA WHEELER, Clerk to the Board of Commissioners of the County of Harnett, North Carolina, DO HEREBY CERTIFY that the foregoing is a true and exact copy of a resolution entitled "RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE COUNTY OF HARNETT, NORTH CAROLINA, AUTHORIZING THE NEGOTIATION OF AN AMENDMENT TO AN INSTALLMENT PURCHASE CONTRACT AND PROVIDING FOR CERTAIN OTHER RELATED MATTERS THERETO" adopted by the Board of Commissioners of the County of Harnett, North Carolina, at a meeting held on the 161 day of March, 2015. WITNESS my hand and the corporate seal of the County of Harnett, North Carolina, this the 16th day of March, 2015. 0111�'�MXS�'., PPAB 2729801v4 4 L.LA am MAR CARET REG WHEELER Cler to the Boar County of Harnett, North Carolina