Request for Bank Loan Proposals
| Agency: | City of Flagler Beach |
|---|---|
| State: | Florida |
| Type of Government: | State & Local |
| NAICS Category: |
|
| Posted Date: | Sep 23, 2024 |
| Due Date: | Oct 10, 2024 |
| Solicitation No: | FB-24-0910 |
| Original Source: | Please Login to View Page |
| Contact information: | Please Login to View Page |
| Bid Documents: | Please Login to View Page |
| Bid Number: |
FB-24-0910
|
| Bid Title: |
Request for Bank Loan Proposals
|
| Category: | Invitation to Bid |
| Status: | Open |
|
Attachment Preview
CITY OF FLAGER BEACH, FLORIDA
REQUEST FOR BANK LOAN PROPOSALS
IN AN AMOUNT NOT TO EXCEED $21,000,000
TAX-EXEMPT (Non-BQ) LINE OF CREDIT
RFP Issue Date: September 20, 2024
Proposal Due Date: October 10, 2024 @ 4:00 pm ET
Table of Contents
A. PURPOSE ....................................................................................................................................................... 1
C. THE PROJECT ............................................................................................................................................... 1
D. SECURITY ..................................................................................................................................................... 2
E. ADDITIONAL DEBT TEST (ANTI-DILUTION).........................................................................................2
F. TAX-EXEMPT OBLIGATION ...................................................................................................................... 2
G. ACCELERATION .......................................................................................................................................... 2
H. DOCUMENTATION ...................................................................................................................................... 2
I. PROPOSAL FORMAT ................................................................................................................................... 4
J. MISCELLANEOUS........................................................................................................................................4
K. DELIVERY INSTRUCTIONS ....................................................................................................................... 6
APPENDICES
Appendix A: Outstanding Governmental Fund Debt
Appendix B: Example Additional Debt (Anti-Dilution) Calculation
LINKS
Financial Statements and Budget Information:
https://www.cityofflaglerbeach.com/123/Finance
A. PURPOSE
The City of Flagler Beach, Florida (the “City”) is requesting proposals from financial institutions for a non-bank
qualified, tax-exempt non-revolving line of credit (the “Loan”, “Line”, or “Note”) to provide funding for a) the repair
and replacement of the Flagler Beach Fishing Pier and expenditures related thereto and b) the issuance costs associated
with the Loan.
The City shall accept and review proposals from qualified financing institutions based upon the proposed financing
structure outlined below. The City will select the bank that provides the lowest overall borrowing cost and meets
the financing requirements of the City. Hilltop Securities Inc., Orlando, Florida, as Financial Advisor to the City in
connection with the Loan, will be assisting the City with respect to the Loan.
B. STRUCTURE OF FINANCING
Facility:
Amount:
Non-Revolving Line of Credit
Up to $21,000,000
Closing Date:
Expected on or before November 21, 2024
Interest Rate:
Non-Bank Qualified, Tax-Exempt variable rate for the entire term of
the Line
Final Maturity:
3-years from closing (anticipated November 1, 2027)
Prepayment:
The City requests the ability to prepay all or a portion of the Note at
any time without penalty
Interest Payments Dates:
Preferred semi-annually on the 1st day of the applicable month and at
Maturity; more frequent payments may be accepted if required by the
Lender
Interest Compounding:
None
Interest Day Count Method:
Please specify in proposal
Principal Payment Date:
At Final Maturity
C. THE PROJECT
As a result of Hurricane Matthew, the Flagler Beach Fishing Pier incurred significant damage. Proceeds of the
Line, along with other available funds, if any, will be used primarily for the repair and replacement of portions of
the Flagler Beach Fishing Pier and expenditures related thereto. The City currently estimates the project costs to be
up to approximately $21 million and anticipates the estimated project costs will be funded through Federal (75%)
and State (25% up to $4.5 million) grants with the residual amount, if any, funded by the City. The Line will
provide an interim funding mechanism prior to the reimbursement from these federal and state sources; however,
the City cannot provide any assurance as to the amount, if any, or timing of any monies from federal or state sources.
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D. SECURITY
The Loan will be secured by a) the Federal and State grants and b) a covenant to budget and appropriate (CB&A) from
Non‐Ad Valorem Revenues of the City. Non-Ad Valorem Revenues shall mean all revenues, other than revenues
generated from ad valorem taxation on real or personal property, which are legally available to make the payments on
the Loan. The Note shall not be considered a general obligation of the City. Neither the full faith and credit nor taxing
power of the City, Flagler County, the State or any political subdivision thereof will be pledged to the payment of the
Note. The Note will not be secured by a debt service reserve fund.
E. ADDITIONAL DEBT TEST (ANTI-DILUTION)
The City may incur additional debt secured by all or a portion of the Non-Ad Valorem Revenues only if the total amount
of Non-Ad Valorem Revenues for the prior Fiscal Year for which audited financial statements are available were at
least 1.5 times the maximum annual debt service of all debt expected to be paid from Non-Ad Valorem Revenues
(collectively, "Debt"), including any Debt payable from one or several specific revenue sources.
For purposes of calculating maximum annual debt service if the terms of the Debt are such that interest thereon for any
future period of time is to be calculated at a rate which is not then susceptible of precise determination ("Variable Rate
Debt"), interest on such Variable Rate Debt shall be computed assuming that interest accrues on such Debt at the current
"Bond Buyer 25-Bond Revenue Index" as published in The Bond Buyer (or comparable Index if “Bond Buyer 25-Bond
Revenue Index” no longer exists) no more than three weeks prior to any such calculation. In addition, with respect to
debt service on any Variable Rate Debt which is subject to a hedge agreement, interest on such Debt during the term of
such hedge agreement shall be deemed to be the hedge payments coming due during such period of time but only up to
the notional amount of the hedge agreement. For purposes of calculating maximum annual debt service, balloon
indebtedness shall be assumed to amortize over 25 years on an approximately level debt service basis. For purposes of
this paragraph, “balloon indebtedness” includes indebtedness if 25% or more of the original principal amount thereof
comes due in any one year. For purposes of calculating maximum annual debt service, with respect to debt service on
any Debt to which the City elects to receive or is otherwise entitled to receive direct subsidy payments from the United
States Department of Treasury, when determining the interest on such Debt for any particular interest payment date the
amount of the corresponding subsidy payment shall be deducted from the amount of interest which is due and payable
with respect to such Debt on the interest payment date. With respect to debt service on any Debt which the City has
covenanted to budget and appropriate sufficient Non‐Ad Valorem Revenues as a secondary source of funds to satisfy
such obligation, only that portion of the debt service on such Debt which was paid for from Non‐Ad Valorem Revenues
in the immediately preceding Fiscal Year shall be considered in calculating maximum annual debt service.
F. TAX-EXEMPT OBLIGATION
The City agrees to take such actions as may be required by U.S. Treasury regulations in order to maintain the tax-
exempt status of the Series 2024 Note.
G. ACCELERATION
The City will not accept proposals that require acceleration as a remedy for a default.
H. DOCUMENTATION
Bryant Miller Olive P.A. (“Bond Counsel”) shall prepare the Note and other documents to close the Loan. The
selected bank will be furnished, without charge to the bank, the opinion of the City’s Bond Counsel, approving the
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legality of the Loan together with the closing certificates and documents related to the transaction. HilltopSecurities
will also assist the City in meeting its financing objectives.
At the closing of the Loan, the financial institution (the “Bank”) will be required to make certain certifications,
including, but not limited to, signing a closing certificate that:
a. It is making the Loan for its own account, does not currently intend to syndicate the Loan, will take no
action to cause the Loan to be characterized as a security, and will not treat the Loan as a municipal
security for purposes of the securities law;
b. it is not acting as a broker or other intermediary, and is funding the Loan from its own capital for its own
account and not with a present view to a resale or other distribution to the public, and currently intends
to hold the Loan to the earlier of maturity or redemption;
c. the Loan will not be used in the future on a securitized transaction and is not a municipal security;
d. it understands that the Loan is evidenced by a note and the note is issued in a single denomination equal
to the aggregate principal amount of the Loan and may not be transferred except in whole and will not
be transferred to any kind of trust under any circumstances, and confirming that it understands the Loan
may not be transferred in a denomination less than $100,000 even in whole;
e. the Loan may only be transferred to a Permitted Lender in whole. A “Permitted Lender” means an
affiliate of the Bank or any bank, trust company, savings institution or insurance company that is
engaged as a regular part of its business in making loans and is authorized to do business in the State of
Florida;
f. the Bank is a bank, trust company, savings institution, insurance company, dealer, investment company,
pension or profit-sharing trust, or qualified institutional buyer as contemplated by Section 517.061(7),
Florida Statutes; and is an “accredited investor”;
g. it has in its possession or has had access to all material information concerning the security and sources
of payment of the Note, and, as a result thereof, is thoroughly familiar with the nature and risks of
making the Loan and purchasing the Note. It has been afforded access to all material information and
has had sufficient opportunity to discuss the business of the City and the projects financed with the
proceeds of the Note, with its officers, employees and others, and has been permitted to make an
investigation of the City and its operations. It does not require any further information or data
concerning the City. In making the Loan and purchasing the Note, it has relied solely upon its own
investigation, examination, and evaluation of the City and other relevant matters, and has not relied upon
any statement or materials which have not been supported by its own investigation and examination. It
has knowledge and experience in financial and business matters, particularly in tax-exempt obligations,
and is capable of evaluating the merits and risks of making the Loan and purchasing the Note and has
determined that it can bear the economic risk of making the Loan and purchasing the Note;
h. it is not funding the Loan for the direct or indirect promotion of any scheme or enterprise with the intent
of violating or evading any provision of Chapter 517, Florida Statutes;
i. it understands that the Loan is not a municipal security and that, unless otherwise required, no filing may
be made with respect to the Loan with EMMA, the Municipal Securities Rulemaking Board continuing
disclosure site;
j. there will be no CUSIPs obtained on the Loan; and
k. there will be no credit rating obtained on the Loan
The selected financial institution shall also be required to execute such additional certifications or acknowledgments
as are customary on similarly structured municipal finance transactions, as reasonably determined by Bond Counsel.
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This page summarizes the opportunity, including an overview and a preview of the attached documents.
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