Upcoming Financial Transactions - Finance Department Overview
The Finance Department led by Kelly Dowe is preparing for upcoming financial transactions in 2012, including annual financing plans, general obligation refunding bonds, and revenue refunding bonds for favorable market conditions and savings opportunities.
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Presentation Transcript
Upcoming Financial Transactions Finance Department Kelly Dowe, Director March 6, 2012
Annual Financing Plan Size Department Series Anticipated Closing ($ millions) HAS 2012A,B,C 520 April 2012 GO 2012A,B 300-500 May 2012 CEF 2012A 40-50 May 2012 CUS 2012W 200-300 TBD GO 2010 CO 10 June 2012 GO TRANS 2012 TBD July 2012 CUS* TWDB 2012X 50 Sept. 2012 CUS* TWDB 2012Y 49 Sept. 2012 CUS 2012Z 132 Dec. 2012 Total 1,301 - 1,611 * The referenced transactions are new issues that will be placed through the Texas Water Development Board. 2
General Obligation Refunding Bonds Series 2012 Commercial paper (CP) has provided an expedient, cost effective method of accessing cash and providing interim financing. The CP notes are later refinanced into fixed rate bonds that match the useful life of the project or equipment being financed. This transaction represents the normal refunding of these commercial paper notes. On June 16, 2010, City Council approved the issuance of the City of Houston Certificate of Obligation (Demolition Program) Series 2010. The note had a 24 month maturity and a maturity date of June 30, 2012. The Finance Working Group (FWG) is considering either refunding this note into long-term bonds in conjunction with the PIB Series 2012 or extending the maturity date of the note. Additionally we will be refinancing some currently outstanding bonds at lower current market interest rates which result in present value savings currently estimated at $14.1 million. 3
General Obligation Refunding Bonds Series 2012 Below is a breakdown of proposed components: Component being Refunded Refund CP Series G, H, J Refund CP Series E Up To Use $130,000,000 $60,000,000 CIP/Drainage EAP Total $190,000,000 Current/Advance Refundings Certificate of Obligation Series 2010 $300,000,000 $10,000,000 $310,000,000 Demolition Program Total Grand Total $500,000,000 Assuming conducive market conditions, the FWG will propose to City Council a refinancing that results in positive present value savings. RCA is expected to be brought before Council in March. 4
C & E Revenue Refunding Bonds Series 2012 The issuance of the proposed Convention and Entertainment Facilities Department Hotel Occupancy Tax (HOT) and Special Revenue Refunding Bonds, Series 2012 are in response to favorable market conditions. The FWG recommends issuing the Series 2012 Bonds to refinance the currently outstanding Series 2001B Bonds at lower current market interest rates and produce an estimated $4.9 million of present value savings, which constitutes an estimated 11.9% saving. RCA is expected to be brought before Council in March. 5
