CITY OF TEXARKANA, AR

REQUEST FOR BOARD ACTION

 

AGENDA TITLE: Adopt a Resolution to accept the proposal from Stephens, Inc., to issue a new Franchise Fee Secured Capital Improvement Revenue Bonds. (FIN)

 

AGENDA DATE: 11/06/2017

ITEM#: 13

DEPARTMENT: Finance Department

DATE SUBMITTED: 10/25/2017

PREPARED BY: TyRhonda Henderson

SUBJECT: Issue new Franchise Fee Secured Capital Improvement Revenue Bonds

EXHIBITS: Resolution and fee proposal prepared by Stephens, Inc.

APPROVAL TO PLACE THIS ITEM ON THE AGENDA:

 

 

EXPENSE REQUIRED: $0

AMOUNT BUDGETED: $0

APPROPRIATION REQUIRED: $0

 

SUMMARY: A Request for Proposal (RFP) was sent to two (2) firms used throughout the state. Only one of these firms submitted a proposal. The RFP requested that the firms submit a proposal for underwriting services for the proposed issue of new Franchise Fee Secured Capital Improvement Revenue Bonds. Stephens, Inc.’s proposal includes cost of issuance fees estimated at $43,275 and total underwriter’s discount of $22,423.50. Both are included in the principal amount of $2,265,000. After careful review, staff recommends selecting Stephens, Inc. to perform the issuance of the Franchise Fee Secured Capital Improvement Revenue Bonds. The revenue from these bonds will be used to purchase necessary capital equipment for the public safety sector of the City.

BOARD ACTION: The City Manager and Finance Director recommend that the City Board of Directors approve the attached resolution.

 

EMERGENCY CLAUSE: This is a resolution and does not require an emergency clause.

 

 

RESOLUTION NO. ______

A RESOLUTION EXPRESSING THE INTENT OF THE CITY OF TEXARKANA, ARKANSAS, TO REIMBURSE EXPENDITURES OF THE CITY PERTAINING TO CERTAIN CAPITAL IMPROVEMENTS FROM THE PROCEEDS OF FRANCHISE FEE SECURED REVENUE BONDS TO BE ISSUED BY THE CITY: AUTHORIZING THE MAYOR AND CITY MANAGER, IN COOPERATION WITH THE UNDERWRITER AND BOND COUNSEL, TO PROCEED WITH MATTERS PRELIMINARY TO THE ISSUANCE OF THE BONDS FOR THE PURPOSE OF ISSUING NEW FRANCHISE FEE SECURED CAPITAL IMPROVEMENT BONDS; APPOINTING AN UNDERWRITER AND BOND COUNSEL; APPROVING THE PREPARATION AND DELIVERY OF A PRELIMINARY OFFICIAL STATEMENT; AND SETTING FORTH OTHER MATTERS PERTAINING THERETO.

 

WHEREAS, the Board of Directors has determined it is in the best interest of the City to issue new Franchise Fee Secured Capital Improvement Revenue Bonds in the aggregate principal amount not exceeding $2,350,000.00 secured by and payable from the franchise fees charged to public utilities for the privilege of using the City’s streets and rights-of-way for the purpose of financing capital improvements in the City, consisting generally of capital equipment for the public safety sector and other public safety improvements; and

WHEREAS, the City has determined the need to expend its funds to pay certain costs of the capital improvements prior to the issuance of the bonds; and

WHEREAS, in order to utilize the proceeds of tax-exempt bonds to reimburse original expenditures made by the City with respect to the capital improvements, it is necessary under United States Treasury Regulation § 1.150-2 that the City make a present declaration of its official intent to make such reimbursement; and

WHEREAS, in order to provide for the issuance and sale of the bonds, the City has selected Stephens Inc., to serve as Underwriter and Rose Law Firm, A Professional Association, to serve as Bond Counsel; and

NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the City of Texarkana, Arkansas, that:

Section 1: Such preliminary actions as are determined to be necessary by the Mayor and City Manager are hereby authorized for the marketing of new Franchise Fee Secured Capital Improvement Revenue Bonds by the City of Texarkana, Arkansas, in the aggregate principal amount not exceeding $2,350,000.00 in order to purchase capital equipment for the public safety sector; provided, however, that at such time as the Mayor and City Manager may determine to be in the best interests of the City, the final terms of the sale of the Bonds shall be submitted for approval by the Board of Directors, together with the proposed form of the documents necessary for the issuance of the Bonds, including, without limitation, the bond purchase agreement and trust indenture.  The sale of the Bonds may be considered at a regular or special meeting of the Board of Directors as the Mayor shall consider appropriate.

Section 2: Stephens Inc. is hereby selected to serve as underwriter and Rose Law Firm, a Professional Association, is hereby selected to serve as Bond Counsel for the bonds.  The City Manager is hereby authorized to execute and deliver an engagement agreement with Bond Counsel.

Section 3: The preparation of a Preliminary Official Statement and its distribution to prospective purchasers of the Bonds are hereby approved.  The Mayor is hereby authorized and directed to cause the Preliminary Official Statement to be delivered for and in the name of the City, with such provisions therein as shall be approved by the Mayor, who is authorized to execute and deliver to the Underwriter a certificate, when requested by the Underwriter, to the effect that the Preliminary Official Statement is deemed final for the purposes of Securities and Exchange Commission Rule 15c2-12.

Section 4: The City hereby declares its official intent pursuant to United States Treasury Regulation § 1.150-2 to reimburse itself for original expenditures made in planning, designing, acquiring, constructing, and equipping the capital improvements described above between the date that is 60 days prior to the date of this Resolution and the date the Bonds are issued, plus a de minimis amount and preliminary expenditures, with proceeds of one or more series of tax-exempt bonds in principal amount not to exceed $2,350,000.

Section 5: The City hereby authorizes and directs the Mayor, the City Manager, and other officers and employees of the City to carry out or cause to be carried out all appropriate actions, to execute such other certificates or documents to evidence authority as authorized herein, and to take such other actions as they, in consultation with Bond Counsel and the Underwriter, shall consider necessary or advisable in connection with this Resolution and the Preliminary Official Statement, in order to prepare for the issuance, sale, and delivery of the Bonds.

Section 5: This Resolution shall be effective from and after the date of its adoption.

PASSED AND APPROVED this 6th day of November, 2017.

 

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_____________________________

Ruth Penney Bell, Mayor

ATTEST:

_____________________________

Heather Soyars, City Clerk

 

APPROVED:

_____________________________

George M. Matteson, City Attorney

 

 

 

 

CERTIFICATE

 

 

STATE OF ARKANSAS

)

COUNTY OF MILLER

)

CITY OF TEXARKANA

)

 

 

I, Heather Soyars, City Clerk of the City of Texarkana, Arkansas, DO HEREBY CERTIFY that I am the legal custodian of the official records of the City of Texarkana, Arkansas, and that the attached is a true and correct copy of ________________________ passed on the _____ day of ____________________, which is on record in the official records of the City of Texarkana, Arkansas.

GIVEN UNDER MY HAND AND SEAL OF OFFICE this _____ day of _____________________________.

 

 

 

 

 

 


 

 

Heather Soyars, City Clerk

City of Texarkana, Arkansas