AG 2007 06 18 - Laserfiche WebLink

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May 25, 2007 To: Board of County Commissioners From: Pamela S. Dubois, Deputy County Manager Subject: Debt Instrument for New High School, Kannapolis Land purchase Cabanus County Board of Commissioners previously approved to enter into an installment financing agreement not to exceed $8,500,000 for the purpose of providing funding to fast track the new High School in the Northwest Area of the County. In January of 2008, the County anticipates issuing debt to cover the cost of constructing the New High School; eliminating the installment financing in the amount not to exceed $8,500,000; and, purchasing land for a new school in Kannapolis. There are two options for this fmancing: General Obligation Bonds and Certificates of Participation. The Board has been provided some data comparing the two options but a summary is listed below: 1. The interest rate difference is estimated at .181% higher for the COPS versus the GO Bonds. 2. The overall interest cost is estimated at $521,525 higher for the COPS versus the GO Bonds but the COPS will also have a higher principal balance of $600,000 which can be used for projects. 3. The GO Bonds would require to be placed on the November 6~' ballot at an estimated cost to the County of $15,000 for the election. Should the Boazd select to utilize the GO Bonds, the County needs to begin the steps necessary for a GO Bond Referendum to take place in November. The process needs to begin in July and may require the Board to call some special meetings to ensure that all the steps are completed. The debt is currently projected at approximately $60,000,000. In the 5 year plan for schools construction, approximately $7,000,000 is requested to be added to this issue to begin the phase I projects requested by the Schools (AL Brown High School Wing Addition, AT Allen Replacement, Middle School in Southwest area of the County, Lower Rocky River Elementary School, and an Elementary School in the Odell Area). The $7,000,000, combined with the lottery proceeds and APFO funds for FY 2008, would cover land cost, architect, engineering and site preparation (Middie School in Southwest area) for the projects included in phase I. ~-13