City of Panama City, Florida

Transcription

1 City of Panama City, Florida RFP PC REQUEST FOR PROPOSALS FOR BANK LOAN OR LEASE PURCHASE FINANCING TO PROVIDE TAX-EXEMPT, BANK QUALIFIED OR NON-BANK QUALIFIED FINANCING FOR EQUIPMENT IN CONNECTION WITH THE ENERGY SAVINGS PERFORMANCE CONTRACT RFP Issue Date: August 16, 2016 Proposal Due Date: August 30 2:00 pm Central Time

2 TABLE OF CONTENTS A. PURPOSE... 2 B. STRUCTURE OF FINANCING... 2 C. SECURITY FOR THE LOAN... 2 D. ADDITIONAL BONDS TEST... 4 E. TAX-EXEMPT OBLIGATION... 4 F. DOCUMENTATION... 4 G. PROPOSAL FORMAT... 5 H. MISCELLANEOUS... 6 I. TENTATIVE SCHEDULE... 8 J. RFP INSTRUCTIONS... 8 APPENDIX A Preliminary Bank Loan Principal Amortization Schedule APPENDIX B Historical Pledged Revenues APPENDIX C - Outstanding Parity Debt Service Schedule LINKS FY City of Panama City Audited Financial Statements & Annual Budget for Fiscal Year 2016 can be found on the link below.

3 A. PURPOSE The City of Panama City, Florida (the City ) is requesting proposals from various financial institutions for a principal amount not to exceed $5,000,000. The City will utilize the funds for the financing of equipment in connection with the Energy Savings Performance Contract. Proposals for a Bank Qualified and Non-Bank Qualified, tax-exempt fixed rate loan options should be submitted based upon the financing structure below. The City shall accept and review proposals from qualified banking institutions. The City will select the bank financing that provides the lowest overall borrowing cost and meets the financing requirements of the City. FirstSouthwest, a Division of Hilltop Securities Inc. ( FirstSouthwest ), Orlando, Florida, as the City s Financial Advisor, will be assisting the City in obtaining the bank loan. B. STRUCTURE OF FINANCING Amount: Not to exceed $5,000,000 Settlement Date: Expected on or before October 11, 2016 Rate: Prepayment: Bank Qualified and Non-Bank Qualified (NBQ) fixed interest rate for the entire term of the financing. The City requests the ability to prepay the obligation without penalty at any time. Other prepayment terms will be considered. Final Maturity: October 1, 2031 Interest Payments Dates: Interest Compounding: Interest Day Count Method: Quarterly, each January 1, April 1, July 1 and October 1, commencing on April 1, None Please specify in proposal Principal Payment Date: Quarterly, commencing on April 1, 2017 Debt Service Structure: Please refer to Appendix A C. SECURITY FOR THE LOAN The Capital Improvement Revenue Note, Series 2016 (the Series 2016 Note ) will be payable from and secured by a lien upon and pledge of the proceeds of the Occupational License Tax (Merchants License Tax) ( Pledged Revenues ) and, until applied in accordance with the provisions of the Resolution, the proceeds of the Series 2016 Note and all moneys, including investments thereof, in certain of the funds 2

4 and accounts established pursuant to a Resolution adopted by the City Commission of the City on November 17, 1992, as amended and supplemented (collectively, the Resolution ). In addition, the City will covenant to budget and appropriate legally available non-ad valorem revenues to pay any debt service shortfall. Alternatively, the City will consider a proposed lease-purchase structure, whereby annual lease payments are subject to appropriation by the City. The Series 2016 Note will not be secured by a debt service reserve account. The Series 2016 Note will be on parity with the City s Capital Improvement Revenue Note, Series 2013A and 2013B. Please refer to Appendix C for the debt service schedule of the outstanding parity bonds. Occupational License Tax (Merchants License Tax) The Occupational License Tax is levied and collected by the City pursuant to Ordinance No. 639 enacted by the City on October 1, 1961, as amended and republished or codified in Chapter 7, Article II (previously Chapter 15), of Code of Ordinances, City of Panama City, Florida (2006), as amended and supplemented from time to time. The taxes are levied on any person who exercises any privilege in, carries on, engages in or conducts any of the businesses, occupations or professions that are specified in the ordinance for the amount particularly enumerated in the ordinance. Occupations are classified according to the type of work provided, whereby some are required to pay the Occupational License Tax according to their gross sales, income, or receipts for the year, and others are required to pay the tax according to the amount of floor space, seating capacity, number of employees, number of units or equipment or other units of measurement. When the occupational licensing tax is based upon the amount of floor space, seating capacity, number of employees, number of units of equipment or other units of measurement, the tax is due and payable according to the greatest amount of floor space, highest seating capacity, greatest number of employees, greatest number of units of equipment and greatest number of any other units of measurement employed or used during any 24-hour period of the license year. If any person operates a business, which falls into more than one classification, it is required to comply with the license requirements of each such classification. If any person operates a business at more than one location, each location is considered a separate business and therefore requires a separate occupational license. Even those merchants, who operate chain stores outside the City but use a warehouse or wholesale depot within the City to replenish their chain stores, are required to obtain separate merchant s licenses for each warehouse or wholesale depot. The occupational licenses are sold by the License Department of the City beginning September 1 of each year and are due and payable on October 1 of each year. The licenses expire on September 30 of the succeeding year. Licenses which are not paid by October 15 are considered delinquent and then become subject to delinquent penalties. Businesses, which begin during the current tax year, are able to pay a prorated tax, according to the quarter of the year in which the business entered the market. Occupational licenses are transferable, through, upon the approval of the City clerk-treasurer and upon payment of a minimal transfer fee. The license tax on every retail and wholesale merchant whether any other license tax is required by any other provision, shall be measured by the amount of gross sales made by such merchant 3

5 and shall be calculated and payable as follows: The tax shall be on the basis of $10 for each $1,000 (1%) of gross sales for retail merchants and $0.50 for each $1,000 (.05%) for wholesale merchants and is payable on the 30 th day of each month for the preceding month. The minimum monthly tax charged each merchant shall be $1.50. A three percent discount shall be allowed if payment is made on or before the 20 th day of the month such tax is payable. Merchants submit a Local Business Tax Return with monthly remittances. D. ADDITIONAL BONDS TEST The City shall have the right to finance capital projects or the completion thereof and to refund obligations secured under the Resolution or obligations which are subordinate to the parity bonds, by the issuance of one or more additional series of bonds to be secured by a parity lien on and ratably payable from the pledged revenues and any other security pledged, provided in each instance that: a) The City shall certify that it is current in all deposits into the various funds and accounts established under the Resolution and all payments required to have been deposited or made by it under the provisions of the Resolution and has complied with the covenants and agreements of the Resolution. b) There shall have been obtained and filed with the City a certificate of an independent certified public accountant: (1) stating that such accountant has examined the books and records of the City relating to collection and receipt of the Pledged Revenues; (2) setting forth the amount of Pledged Revenues for the immediately preceding Fiscal Year or any twelve (12) consecutive months selected by the City from the eighteen (18) months immediately preceding the issuance of such additional bonds; (3) stating that such Pledged Revenues equal at least 1.35 times the Maximum Debt Service Requirement of all outstanding bonds and such additional bonds then proposed to be issued; and (4) stating that no event of default was disclosed in the report of the most recent annual audit, or if such event of default was so disclosed, that it shall have been cured. E. TAX-EXEMPT OBLIGATION The City will agree to take such actions as may be required by Treasury regulations in order to maintain the status of the Series 2016 Note as a tax-exempt obligation. F. DOCUMENTATION Nabors, Giblin and Nickerson, P.A., Tampa, Florida ( Bond Counsel ) shall prepare the Series 2016 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 legality of the Loan together with the closing certificates and documents related to the transactions. FirstSouthwest will also assist the City in structuring the loans to meet the financing objectives of the City. At the closing of the Loan, the financial institution will be required to make certain certifications, including, but not limited to, signing a closing certificate that: 4

6 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, 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 denominations less than $100,000 even in whole; e. the Loan will only be sold to a Permitted Lender in whole, in a denomination of not less than $100,000, with the City s consent. The Permitted Lender means any bank, trust company, savings institution or insurance company that is engaged as a regular part of its business in making loans authorized to do business in the State of Florida; f. the Lender 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 (7), Florida Statutes; g. 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; h. understands that the Loan is not a municipal security and that no filing will be made with respect to the Loan with EMMA, the Municipal Securities Rulemaking Boards continuing disclosure site; i. there will be no CUSIPs obtained on the Loan; and j. there will be no credit rating obtained on the Loan. G. PROPOSAL FORMAT Proposals will be evaluated on the basis of cost and the structure that best meets the financing requirements of the City. Further, the City will accept proposals that provide for the ability to prepay the Loan in whole or in part at any time without penalty. Prepayment penalties will be considered. In order to assist the City and FirstSouthwest in reviewing the responses, each proposal should include the following information. (1) The legal name of the Bank and the primary Bank contact person(s) (include address, telephone number, facsimile number, and address). 5

7 (2) Fixed Interest Rates for the full term of the Loan. The bidder shall give a stated time in which the proposed rate will be held as well as the index in which the rate shall be calculated should the stated time elapse. (3) Describe in detail of all fees and expenses, which the City will be responsible to pay to the Bank including its legal counsel. The City has retained the law firm of Nabors, Giblin and Nickerson, P.A., to prepare the tax opinion and resolution. The amounts stated in the proposal shall represent the maximum amounts payable to the Bank by the City. All fees and expenses, with the exception of those of Bond Counsel and FirstSouthwest, in excess of those stated in the proposal shall be the sole responsibility of the Bank and will not be paid or reimbursed by the City. (4) A listing of all conditions, covenants, terms or restrictions, other than those specified in this RFP, which would be included in your commitment to provide the loan. H. MISCELLANEOUS (1) The City will not accept proposals with reserve requirements or other restrictions to revenues or requirements to maintain minimum balances in any bank account as a condition for the Loan. (2) The City reserves the right, in its sole discretion, to accept or reject any and all bids, to waive any irregularities or informalities in any bid or in the bidding, and to accept or reject any items or combination of items. If a bank financing proposal is selected, the award will be to the financial institution whose response best complies with the requirements set forth in this RFP and whose bid, in the opinion of the City and Financial Advisor is best, taking into consideration all aspects of the offeror s response. (3) Changes to this RFP may be made by and at the sole discretion of the City. (4) The City will not be liable for any expenses incurred in connection with the preparation of a response to this RFP. (5) The bidder is required to conduct its own investigation and evaluation of the creditworthiness of the Loan. The Proposal has provided a link to the City s Website ( which has information regarding the City and its financial statements. Additional financial information will be provided upon request by the bidder and is NOT in any way intended to relieve the bidder of its responsibility to investigate all relevant or material facts in reaching a credit decision with respect to the loan. All requests for clarification or additional information should be provided no later than 4:00 pm Central August 22, 2016 in writing via or fax to: Mr. Gary Akers, Director Ms. Darlene Hachmeister, CPA, CFE Ms. Angela Singleton, Asst. VP City Clerk Treasurer FirstSouthwest, a Division City of Panama City of Hilltop Securities Inc. (850) Ph (407) Ph -OR- (850) Fax (407) Fax dhachmeister@pcgov.org gary.akers@hilltopsecurities.com angela.singleton@hilltopsecurities.com 6

8 (6) Federal, State, City and local laws, ordinances, rules and regulations that in any manner affect the items covered herein apply. Lack of knowledge by the Bank will in no way be a cause for relief from responsibility. (7) No successful offeror may assign any portion of the contractual agreement between the parties without prior written authorization by the City. (8) Warranties The offeror, in submission of its proposal, warrants to the City that it will comply with all applicable federal, state and local laws, regulations and orders in providing the services under the proposed documents. (9) Public Entity Crime; Florida Statutes, (2)(a): A person or affiliate who has been placed on the convicted vendor list following a conviction for a public entity crime may not submit a bid, proposal, or reply on a contract to provide any goods or services to a public entity; may not submit a bid, proposal, or reply on a contract with a public entity for the construction or repair of a public building or public work; may not submit bids, proposals, or replies on leases of real property to a public entity; may not be awarded or perform work as a contractor, supplier, subcontractor, or consultant under a contract with any public entity; and may not transact business with any public entity in excess of the threshold amount provided in s for CATEGORY TWO for a period of 36 months following the date of being placed on the convicted vendor list. I. TENTATIVE SCHEDULE* The City will attempt to adhere to the following schedule: August 16, 2016 August 22, 2016 Issue Request for Proposal (RFP) Deadline for Questions (4:00 pm Central) (1) August 30, 2016 Bank Proposals Due Prior to 2:00 P.M. (Central) September 6, 2016 Recommendation to the City September 27, 2016 Commission approval of Resolution authorizing execution of loan documents October 11, 2016 Closing of the Loan * Preliminary; subject to change (1) All written inquiries and responses will be posted on the City s Website. 7

9 J. RFP INSTRUCTIONS All bids must be submitted by mail or hand delivered to the City at the mailing address below for receipt no later than 2:00 PM Central Time on August 30, City of Panama City Ms. Darlene Hachmeister, CPA, CFE City of Panama City 9 Harrison Avenue Panama City, FL (850) Ph (850) Fax dhachmeister@pcgov.org Late bids will not be accepted. 8

10 APPENDIX A Preliminary Series 2016 Note Principal Amortization* Period Ending Principal Period Ending Principal 04/01/17 43,000 10/01/24 83,000 07/01/17 70,000 01/01/25 84,000 10/01/17 70,000 04/01/25 84,000 01/01/18 71,000 07/01/25 85,000 04/01/18 71,000 10/01/25 85,000 07/01/18 72,000 01/01/26 86,000 10/01/18 72,000 04/01/26 87,000 01/01/19 73,000 07/01/26 87,000 04/01/19 73,000 10/01/26 88,000 07/01/19 73,000 01/01/27 88,000 10/01/19 74,000 04/01/27 89,000 01/01/20 74,000 07/01/27 89,000 04/01/20 75,000 10/01/27 90,000 07/01/20 75,000 01/01/28 90,000 10/01/20 76,000 04/01/28 91,000 01/01/21 76,000 07/01/28 91,000 04/01/21 77,000 10/01/28 92,000 07/01/21 77,000 01/01/29 93,000 10/01/21 78,000 04/01/29 93,000 01/01/22 78,000 07/01/29 94,000 04/01/22 79,000 10/01/29 94,000 07/01/22 79,000 01/01/30 95,000 10/01/22 79,000 04/01/30 95,000 01/01/23 80,000 07/01/30 96,000 04/01/23 80,000 10/01/30 97,000 07/01/23 81,000 01/01/31 97,000 10/01/23 81,000 04/01/31 98,000 01/01/24 82,000 07/01/31 98,000 04/01/24 82,000 10/01/31 99,000 07/01/24 83,000 TOTAL $4,892,000 *Preliminary and subject to change.

11 APPENDIX B Historical Pledged Revenues Fiscal Years Ended September 30 th Merchants License Tax Collections Combined Maximum (1) Annual Debt Service Coverage ,234,675 2,181, ,307,619 1,652, ,678, , ,507,506 1,733, ,000,000 * 1,735, ,500,000** 1,735, (1)Does not include the Proposed Series 2016 Note * Amended Budget FY 2015 ** Proposed FY 2016 Budget Source: City of Panama City 2016 Fiscal Budget

12 APPENDIX C Outstanding Parity Debt Service Schedule Capital Improvement Revenue Note, Series 2013A and 2013B Period Ending Principal Interest Debt Service 10/1/2016 1,437, , ,730, /1/2017 1,469, , ,729, /1/2018 1,076, , ,303, /1/2019 1,102, , ,304, /1/ , , ,062, /1/ , , ,061, /1/ , , ,062, /1/ , , ,062, /1/ ,000 92, ,061, /1/ ,000 70, ,062, /1/2026 1,015,000 47, ,062, /1/2027 1,038,000 23, ,061, ,762,000 1,803, ,565,792.20