Idaho Economic Development Funding Projects with Limited Options

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1 Economic Development Funding Projects with Limited Options Cameron Arial, Vice President ZIONS BANK Public Finance June 10, 2015

2 ZIONS is the #1Advisor to Cities I am pleased to introduce to you our financial advisor Zions Bank Public Finance Zions has assisted us with almost every kind of public financing (revenue, tax increment, local improvement district, and pooled Bond Bank bonds) and has delivered excellent results on each During the process, Zions demonstrated they have a can do attitude. We know from experience that Zions will provide you with excellent financial service in what can often be a daunting process. -Greg Lanting, The Honorable Mayor, City of Twin Falls 1

3 and Public Finance Options Financing Tool State Authorization Security/Collateral Repayment Types of Projects General Obligation Bond 50% vote 66.67% vote Ad valorem property taxes Property tax or other available revenues Many public projects Revenue Bond Tax Increment Bond Authorization of governing body Revenues from water, sewer, electric, 50% vote or other enterprise funds Authorization of governing body Authorization of governing body and possibly judicial confirmation Tax increment from increased property value Revenues from water, sewer, electric, or other enterprise funds Tax increment or other revenue Projects related to the revenue source being pledged Water, sewer, road, and other infrastructure Equipment, fixtures, and real property Authorization of City Council Special Assessment/Local Improvement District Bond 60% vote of property owners or 1/2 plus one vote of City Council Property within assessment area Special assessment levied against property owners Public projects and infrastructure Certificates of Participation**** Authorization of governing body Judicial confirmation Financed improvements General fund or other revenues Equipment, fixtures, and real property Excise Tax/Local Option Tax Revenue Bond Authorization of City Council Resort Cities only. 60% vote to levy tax; 50% vote to borrow against tax Revenues - sales tax, class C road tax, franchise, other excise taxes Revenues from local option taxes Excise tax revenues or other available general fund revenues Roads and other public projects Revenues from local option taxes Lease Revenue Bonds/Lease Purchase Agreements**** Authorization of City Council and LBA Board Authorization of governing body and possibly judicial confirmation Financed equipment and improvements Annually appropriated general fund or other revenues Equipment, fixtures, and real property **** market is limited due to unresolved legal questions 2 Source: and State Statutes

4 and Credit Ratings Comparison AAA Rated Credits State of Salt Lake County Salt Lake City Weber County Davis County Jordan School District (South SL) AAA Rated Credits None Source: and State Statues; Moody's, S&P, and Fitch Rating Agencies 3

5 Total Volume 10 Year Trend Long Term Bonds Issued Per Capita 1,800 1,600 1,400 Debt Issued Per Capita 1,200 1, Source: Bond Buyer Yearbooks

6 Bond Issuance by Category Per Capita Average Annual Bond Issuance by Category Development Education Electrical Environment Health Housing Public Transportation Utilities 5 Source: Bond Buyer Yearbooks

7 Education 10 Year Trend Education Bonds Issued Per Capita Debt Issued Per Capita Source: Bond Buyer Yearbooks

8 Utilities 10 Year Trend Utility Bonds Issued Per Capita Debt Issued Per Capita Source: Bond Buyer Yearbooks

9 Transportation 10 Year Trend Transportation Bonds Issued Per Capita Debt Issued Per Capita Source: Bond Buyer Yearbooks

10 Average Annual GDP Growth 4.5% 4.0% % 3.5% 3.0% 2.8% 2.9% 2.5% 2.4% 2.3% 2.0% 2.0% 2.0% 1.5% 1.0% 1.4% 1.3% 1.3% 0.5% 0.0% United States Mountain States Arizona Colorado Montana Nevada New Mexico Wyoming 9 Source: U.S. Bureau of Economic Analysis

11 Twin Falls URA and Chobani Yogurt Plant Video Link

12 URA Tax Increment Bonds Bid Results 11

13 School Bond Elections 20 School District Bond Elections Pass/Fail History Since 2002 Pass Fail Overall Success Rate since 2002: Pass 109; 57% Fail 81; 43% % Success Rate 14 74% 57% 12 92% 65% % 42% 73% 6 56% 31% 4 38% 43% 50% % Calendar Year 12

14 School Bond Elections % School District Bond Elections Hypothetical Pass/Fail History Since 2002 with 60% Threshold 84% 74% Pass Fail Success Rate Overall Success Rate since 2002: Pass 143; 75% Fail 47; 25% % 87% 76% 58% 75% 91% % 78% % 33% 50% Calendar Year 13

15 Market Update 9.0 BBI on 06/04/ Jan-09 Aug-09 Mar-10 Oct-10 May-11 Dec-11 Jul-12 Feb-13 Sep-13 Apr-14 Nov Weekly Interest Rate (%) Jan-88 Aug-88 Mar-89 Oct-89 May-90 Dec-90 Jul-91 Feb-92 Sep-92 Apr-93 Nov-93 Jun-94 Jan-95 Aug-95 Mar-96 Oct-96 May-97 Dec-97 Jul-98 Feb-99 Sep-99 Apr-00 Nov-00 Jun-01 Jan-02 Aug-02 Mar-03 Oct-03 May-04 Dec-04 Jul-05 Feb-06 Sep-06 Apr-07 Nov-07 Jun-08 Date

16 Thank You! Cameron Arial Vice President ZIONS Public Finance, Inc. (208)