Financing on Dare BOC agenda

Published 3:13 pm Wednesday, March 20, 2024

Dare County commissioners delved into various forms of financing public works at the regularly scheduled March 4, 2024 meeting.

The board approved a grant application for beach nourishment, various aspects of Phase II financing for projects and approved a loan for Stumpy Point Volunteer Fire Department.

The commissioners agreed to apply for a $2.5 million grant for the anticipated 2027 beach nourishment project for four incorporated towns: Duck, Southern Shores, Kitty Hawk and Kill Devil Hills.

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This fiscal year’s $10 million in the Coastal Storm Damage Mitigation Fund “can only be used for beach nourishment or other projects designed to mitigate or remediate coastal storm damage to ocean beaches and dune systems in the state.” The grant requires a 50% match.

Finance director David Clawson was at the podium for a series of financial moves.

Two installment financing resolutions were adopted by the commissioners. In both instances, Banc of America Public Capital Corp was the lowest total cost proposal submitted Feb. 21, 2024.

The county is financing vehicles and equipment in an amount up to $2,737,200 at a rate of 4.2638% for three years. Another financing is for Public Works and network equipment totaling $2,014,911 at a rate of 4.0396% for five years.

The two resolutions award the financing to Banc of America Public Capital Corp and authorize the county manager, clerk to the board and finance staff to execute all necessary financing documents.

Dare County is moving forward with a phased plan to construct new or remodeled Emergency Medical Services stations as well as other items.

At this meeting, five items pushed forward the actions and necessary documents for phase II, which addresses new EMS stations at Manns Harbor and Kitty Hawk and builds the Roanoke Island Youth Center in Manteo. The board’s actions are as follows:

– Voted to proceed with the phase II capital projects at the guaranteed maximum prices, which are youth center at $5,662,863, the Kitty Hawk EMS station at $10,613,910, and the Manns Harbor EMS station at $11,738,234. The Capital Investment Fund maintains adequate coverage levels with no additional funding, states the agenda item.

– Adopted a capital project ordinance for the new 2024 projects and the Series 2024 limited

obligation bonds to finance them and an amendment to the 2023A LOBs capital projects ordinance to show the amount used from that financing towards the 2024 projects.

– Approved Barnhill Contracting Company as the construction manager at risk and authorized the county manager to sign the contract indicating Barnhill’s guaranteed maximum price at a total of $24,232,093 for all three projects.

– Held a public hearing, duly noticed on Feb. 8, 2024, about the Series 2024 limited obligation bonds and the 2024 projects. No person came forward to speak.

– Adopted a resolution to issue the Series 2024 limited obligation bonds. The debt will be an issue of 20-year, publicly sold bonds on May 8, 2024. A summary of the document has this information.

The financing will be in the form of an amendment to last year’s 2023 installment financing contract (Series 2023A limited obligation bonds) that pledged the Kill Devil Hills property and EMS/fire station as collateral.

The board resolutions and documents are worded so that, if needed, debt proceeds may be used between projects, and any project savings and/or interest income greater than budgeted may be used for phase II or III projects.

The resolution uses a not-to-exceed amount of $28,500,000. The current estimated interest rate is at a true interest cost of 3.57%.

On April 2, the board will adopt an approving resolution. Bond approval will be on the Local Government Commission’s May 7 agenda. The bond sale date is May 8 with the closing on May 29.

The resolution states, among other items, that no property tax increase is necessary to finance the projects per the debt affordability model and that the county’s taxing power is not pledged for the financing.

The resolution authorizes the county manager and finance director or designees to proceed with the contract amendment and directs the finance director to retain Parker Poe Adams & Bernstein as bond counsel, DEC Associates as financial advisor, the Bank of New York Mellon Trust Company as trustee, and Piper Sandler & Co. as underwriter and PNC Capital Markets as co-underwriter.

County manager Robert L. Outten told the board that the Stumpy Point Volunteer Fire Department as an opportunity to apply for a grant to purchase radios and turnout gear. The grant is reimbursable. Outten asked the board for permission to loan the fire department $25,000 to purchase the equipment if the grant is received. The commissioners agreed.

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