HomeMy WebLinkAboutMINUTES - 04152003 - C20 • TO: BOARD OF SUPERVISORS
Contra
FROM: MAURICE M. SHIU, PUBLIC WORKS DIRECTORSCosta
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DATE: APRIL 15, 2003 COVCounty
SUBJECT: CONTRA COSTA COUNTY AIRPORTS—REFINANCE OF AIRPORT FUNDING
SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
I. Recommended Action:
APPROVE a Refinancing(including funding an escrow to make payments thereunder),and a Lease/Lease-
Back Agreement with Transocean Funding,Inc.to replace existing Lease and Agreement for improvements
to the Buchanan Field and Byron Airports.
AUTHORIZE the County Administrator, or his designee, to SIGN, on behalf of the County, an updated
Guarantee Certificate,guaranteeing lease payments should the Airport Enterprise Fund be unable to meet its
obligations.
AUTHORIZE the Public Works Director, or his designee, to EXECUTE, on behalf of the County, all
necessary documents to complete the transaction,and to make any minor,non-substantial changes as may be
appropriate to finalize language of the agreement.
Continued on Attachment: X SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR
_RECOMMENDATION OF BOARD COMMITTEE
_APPROVE _OTHER
SIGNATURE(S):
ACTION OF BOARD ON APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS
UNANIMOUS(ABSENT ) I hereby certify that this is a true and correct copy of an action
AYES: NOES: taken and entered on the minutes of the Board of Supervisors on
ABSENT: ABSTAIN: the date shown.
KF:df
C:\Word Files\130\2003\bo4-15 Refinance 2003.doc ATTESTED:
Orig.Div:Public Works(Airport) JOHN SWEETEN,Clerk of the Board of Supervisors and County
Contact: (Keith Freitas 646-5722) Administrator
c: County Administrator
Laura Lockwood,CAO
Auditor/Controller
Public Works Director BY ,Deputy
Public Works Accounting
Federal Aviation Administration
Transocean Funding,Josh Cooperman
SUBJECT: CONTRA COSTA COUNTY AIRPORTS—REFINANCE OF AIRPORT FUNDING
DATE: APRIL 15, 2003 ceov
PAGE: 2
Z
II. Fiscal Impact.
1. Refinancing existing Airport funding agreements will reduce the interest costs to the Airport Enterprise
Fund and will provide additional operating funds to complete various capital improvement projects. The
Airport Enterprise Fund will finance approximately $1,917,531 over a 7-year period. . This new
agreement will include$371,531 of an existing Caltrans loan,$25,003 for the cost of refinance,and the
remaining principal from the existing Transocean Lease and Leaseback of$1,546,000. There will not
be any fiscal impact to the County's General Fund.
III. Reasons for Recommendations and Background:
Over the years, the County's Airports has received millions of dollars in grants from the Federal Aviation
Administration(FAA)to construct the Byron Airport and to complete various other Airport Improvements at
the Buchanan Field Airport. The FAA grants provided 90%of the total cost of the improvements,Caltrans
typically will fund 4.5%, and the County Airports were required to fund the remaining 5.5%.
In 1994, the County, again on behalf of the Airports, entered into two financial agreements 1) to raise
additional funds necessary for the completion of improvements to the Byron Airport that were not otherwise
eligible for FAA nor Caltrans grant funding, and 2)to refinance the outstanding Caltrans loans that were at
relatively high interest rates. These existing agreements were in the form of a Lease and Leaseback
agreement and a License and Lease-Purchase agreement. The agreements provided for semi-annual interest-
only payments up to May 1, 1999, and semi-annual principal and interest payments through May 1, 2002.
The principal of the two agreements totaled$3.495 million.
In 1997,the Board authorized the County on behalf of the Airports to refinance the original agreement with a
new principal amount of$3.646 million in order to take advantage of lower interest rates at the time and to
spread the payments over a longer period of time, which more accurately matched the anticipated Airport
revenues with debt payments up to May 1, 2005.
Staff recommends the proposed advance refunding for the following reasons:
2. The economic incentive to refinance will reduce the County's interest costs by locking in a lower interest
rate.
3. Under the current funding agreement, the Airport Enterprise Fund has three remaining principal
payments due May 1, 2003, May 1, 2004 and May 1, 2005. The three final principal payments are
$600,000, $730,000 and $816,000 respectively. The Airport Enterprise Fund will make its $600,000
principal payment on May 1, 2003, which will leave $1,546,000. This new agreement will include
$371,531 of an existing Caltrans loan, $25,003 for the cost of refinance and the$1,546,000 remaining
principal.
3. The additional disposable capital funds will allow the Airport Enterprise Fund to pay off early two
existing Caltrans loans, which have scheduled final payment dates in 2010 and 2015.
IV. Consequences of Negative Action:
The proposed Airport refinancing will not be approved and potential debt savings will not occur,increasing
the potential for the subsidization of the Airport Enterprise Fund by the General Fund.
THE BOARD OF SUPERVISORS OF
CONTRA COSTA COUNTY, CALIFORNIA
Adopted this Order on APRIL 15, 2003 , by the following vote:
AYES: SUPERVISORS GIOIA, UILKEMA, GLOVER AND DESAULNIER
ABSENT: NONE
ABSTAIN: NONE
DISTRICT III SEAT VACANT
SUBJECT: CONTRA COSTA COUNTY AIRPORTS - REFINANCE OF
AIRPORT FUNDING
RELISTED: ON UNDETERMINED DATE.
I hereby certify that this is a true and correct
copy of an action taken and entered on the
minutes of the Board of Supervisors on the
date shown.
Attested: APRIL 15 , 2003
John Sweeten, Clerk of the Board
Of Supervisors and County Administrator
By:
Depufy Clerk