HomeMy WebLinkAbout2C - PresentationCity of Palm Springs
CITY OF PALM SPRINGS FINANCING AUTHORITY
2025 LEASE REVENUE BONDS
(PUBLIC FACILITIES RENOVATION AND EXPANSION PROJECT)
MAY 28, 2025
OVERVIEW
•Public Improvements to be Financed
•Financing Process
•Cost of Financing
•Resolutions and Recommended Actions
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PUBLIC IMPROVEMENTS
TO BE FINANCED
Library Renovation and Expansion
Total Cost Estimate $40-45 million
Grant Funding $6,569,942
Measure J Funding 8,700,942
Available Funding 15,270,884
Required Bond Funding
$25,000,000-$30,000,000
To be Based on May 29 Bids
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PUBLIC IMPROVEMENTS
TO BE FINANCED
Swim Center Building Renovation
Total Cost Estimate $5 -7 million
Originally to be Funded from Measure J over 2 Years
Bond Funding will Provide Additional Upfront Cashflow to Measure J
Construction to Commence in 12 Months
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FINANCING PROCESS
•Issuance of Lease Revenue Bonds is the City’s
Traditional Method of Financing Infrastructure
•Requires City Council to Conduct a Public Hearing
and Adoption of Resolutions by Both the City
Council and the City of Palm Springs Financing
Authority Board
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FINANCING PROCESS
•Lease Revenue Bonds are Issued by the City of Palm
Springs Financing Authority
•Bonds are Secured by Lease Payments Paid by the City to
the Authority for use of Leased Assets
•Leased Assets Include Library, Leisure Center and Skate
Park Located in Sunrise Park
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FINANCING
COSTS
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Library Swim
Center Total
Project Fund $30,000,000 $7,000,000 (1)$37,000,000
Capitalized Interest (2)3,200,000 -3,200,000
Underwriter Discount 221,000 47,000 268,000
Costs of Issuance 250,000 50,000 300,000
Total Costs 33,671,000 7,097,000 40,768,000
Original Issue Premium (2,121,000)(437,000)(2,558,000)
Par Amount of Bonds Issued $31,550,000 $6,660,000 $38,210,000
(2) Capitalized Interest = Interest on the Library Share of Bonds While Under Construction
(1) Any Excess Funds can be Applied to the Cost of the Pool Renovation
FINANCING
COSTS
•Interest Rates Have Been
Volatile Since February
•“AAA” MMD is the
Benchmark for Tax-Exempt
Bonds
•Interest Rate for the City
Currently Expected to be
4.65% Based on “AA” Rating
(as of May 19)
•Bond Sale Scheduled June 24
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2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
1/30/2025 2/13/2025 2/27/2025 3/13/2025 3/27/2025 4/10/2025 4/24/2025 5/8/2025 5/22/2025
“AAA” Municipal Market Data Index
1 Year 5 Year 10 year 20 year 30 Year
FINANCING COSTS
Debt Service to be Allocated to Measure J
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Library Swim Center Total
Annual Debt Service $2,155,000 $440,000 $2,595,000
Annual Payment Commences FY 2027-28 FY 2025-26
Every Change in Interest Rate by 0.25% = $120,000 Change in Annual Debt Service
RESOLUTIONS
•Approve Form of Financing Documents
-Preliminary Official Statement
-Lease Agreement
-Indenture of Trust
-Agency Agreement
-Official Notice Inviting Bids
•Approve Distribution of Preliminary
Official Statement
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•Authorize Sale of Bonds
•Set Parameters for Bond Sale
•Bond Amount Not-To -Exceed
$40,000,000
•Interest Rate Not-to-Exceed 6%
RECOMMENDED ACTIONS
•City Council
-Open Public Hearing and Receive Testimony
-Close Public Hearing
-Adopt Resolution Authorizing Issuance of Bonds and Related Actions
•Financing Authority Board of Directors
-Adopt Resolution Authorizing Issuance of Bonds and Related Actions
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