Buffalo & Fort Erie Public Bridge Authority

Transcription

1 Buffalo & Fort Erie Public Bridge Authority Request for Proposals for Underwriter Services 1 Peace Bridge Plaza Buffalo, New York Date Issued: November 14, 2013 Submission Deadline: December 11, :00 PM

2 BUFFALO & FORT ERIE PUBLIC BRIDGE AUTHORITY TABLE OF CONTENTS Page I. INTRODUCTION A. General Information... 3 B. Restrictions on Communications... 3 C. Inquires... 3 D. Modifications to the RFP... 3 E. Requirements... 3 II. DESCRIPTION OF THE AUTHORITY AND BOND ISSUANCE A. Name of Contact Person... 5 B. General Information... 5 C. Bond Issuance... 5 III. SCOPE OF SERVICES A. General... 7 B. Scope of Work to be Performed... 7 C. Term of Service... 7 IV. TIME REQUIREMENTS A. Proposal Calendar... 8 B. Expected Notification and Contract Dates... 8 V. PROPOSAL REQUIREMENTS A. General Requirements... 9 B. Proposal C. Fee Schedule VI. EVALUATION PROCEDURES A. Review of Proposals B. Evaluation Criteria C. Oral Presentations D. Final Selection E. Right to Reject Proposals VII. APPLICABLE LAW APPENDIX A RESPONSE FORM SECTION V(B)(6)(c)... 17

3 I. INTRODUCTION A. General Information The Buffalo & Fort Erie Public Bridge Authority (the Authority ) requests proposals from qualified underwriting firms in connection with remarketing existing, tax exempt revenue bonds of the Authority which may include an additional debt issuance to finance future bridge rehabilitation and plaza improvements. Firms intending to respond to this Request for Proposals ( RFP ) should complete the form found at This will ensure that they receive all updates and/or amendments/addendums to this RFP. B. Restrictions on Communications From the date this RFP is issued until the contract award has been announced, no proposerinitiated contact with any Authority official shall be permitted regarding this RFP, other than written inquiries, as described in this section. This includes, but is not limited to, any lobbying of individuals considered to have any influence over proposal evaluation and selection. Violation of this provision will be grounds for immediate disqualification. C. Inquires There will be an opportunity for submission of written questions. All questions or requests for clarification regarding this RFP must be submitted via and must come from one point of contact per firm to Lynne M. Bogdan at lmb@peacebridge.com, no later than November 21, 2013, 1:00 PM EST. Questions or requests for clarification received after such time and date will not receive a response from the Authority. All questions and answers will be posted online at by November 22, 2013, at 5:00 PM. D. Modifications to the RFP The Authority may modify any part of the RFP prior to the deadline for submission of proposals by issuance of an addendum. Any addendum issued by the Authority will be posted to the Authority s website and notification of such posting will be distributed to all firms that provided contact information as requested. E. Requirements The Authority s headquarters is located in Fort Erie, Ontario. Professionals may be required to travel to and have the ability to work in Canada, as required. There is no expressed or implied obligation for the Authority to reimburse responding firms for any expenses incurred in preparing proposals in response to this request and the Authority will not reimburse responding firms for any expenses incurred in preparing proposals in response to this request. 3

4 To be considered for this engagement, one original, eight (8) hard copies and one electronic copy of the proposal must be received by Lynne M. Bogdan, Finance Manager, 1 Peace Bridge Plaza, Buffalo, NY by the time on the date set forth herein. The Authority reserves the right to reject any or all proposals submitted. Proposals submitted will be evaluated by a Committee of the Authority. During the evaluation process, the Authority reserves the right, where it may serve the Authority s best interest, to request additional information or clarification from proposers or to allow corrections of errors or omissions. At the discretion of the Committee, firms submitting proposals may be requested to make oral presentations as part of the evaluation process. The Authority reserves the right to retain all proposals submitted and to use any ideas in a proposal regardless of whether that proposal is selected. Submission of a proposal indicates acceptance by the firm of the conditions contained in this request for proposals, unless clearly and specifically noted in the proposal submitted and confirmed in the contract between the Authority and the firm selected. All qualified applicants will be afforded equal opportunity without discrimination because of race, creed, color, national origin, sex, age, disability or marital status. The Authority encourages minority and women-owned businesses to submit proposals. 4

5 II. DESCRIPTION OF THE AUTHORITY AND BOND ISSUANCE A. Name of Contact Person The principal contact with the Buffalo & Fort Erie Public Bridge Authority will be Lynne M. Bogdan, Finance Manager, who will coordinate communication with and information to be provided by the Authority. B. General Information The Buffalo and Fort Erie Public Bridge Authority is a body corporate and politic constituting a public benefit corporation created under the laws of the State of New York and by an act of the Parliament of Canada and consented to by the United States Congress. The Authority is governed by a ten member Board consisting of five members from New York State and five members from Canada. The mission of the Authority is to be known as the premier Canada/U.S. international border crossing, providing excellence in customer service and an effective conduit for trade and tourism. The Authority owns and operates the Peace Bridge which spans the Niagara River between Buffalo, New York and Fort Erie, Ontario. In addition to toll revenue from vehicles crossing the bridge, the Authority also derives significant revenue in the form of rental and fee income from the United States Bureau of Customs and Border Protection, U.S. and Canadian duty-free shops and commercial brokers operating on the property owned by the Authority. During 2012, toll revenues were approximately $22.5 million, generated from 1.3 million commercial vehicles and 4.7 million automobiles that used the bridge. In addition to the Peace Bridge, the Authority owns, operates and maintains approximately 70 acres of property in Canada and 17 acres of property in the United States. The Canadian property has three buildings constructed in 2006, housing Authority administration, Canada Border Services Agency, and Citizenship and Immigration Canada. The duty-free store, toll collection facilities, and buildings housing customs brokers and Authority maintenance are also located on the Canadian property. The U.S. plaza consists of a duty free store, and buildings housing U.S. Customs & Border Protection and customs brokers. Additional information regarding the Authority and its outstanding bonds may be obtained from the Electronic Municipal Market Access (EMMA) website (CUSIP: AT9) and at The 2012 audited financial statements and other documents related to the Authority are located under About Us/Publications. C. Bond Issuance In August 2005, the Authority issued $44,120,000 in variable rate Toll Bridge System Revenue Refunding Bonds (the Series 2005 Bonds ) to currently refund $43,915,000 of outstanding 1995 Series bonds which bore interest rates ranging from 5.125% to 6.0%. The net proceeds of $43,639,394 (after payment of $480,606 for underwriting fees and other issuance costs) plus $4,788,824 in Series 1995 bond reserve monies were used to refund the original bonds and establish the Series 2005 Bonds debt reserves. 5

6 The Series 2005 Bonds which are special revenue obligations of the Authority, were issued as variable rate obligations. They bore an initial term interest rate of 3% through July 1, On July 1, 2007, the bonds were remarketed at an interest rate of 4% until July 1, On July 1, 2010, the bonds were again remarketed at an interest rate of 2.625% until July 1, Interest is payable semi-annually on January 1 and July 1. On July 1, 2014, the bonds will be subject to mandatory tender without a bondholder right to retain. Under an irrevocable letter of credit guaranteed by the Authority and issued by a bank, the bond trustee is entitled to draw an amount sufficient to pay the principal of the bonds when due and up to 199 days interest. This letter of credit has an initial stated amount of $43,360,176 and will expire on July 15, 2014, unless earlier terminated or extended. The letter of credit supports the obligations of the Authority and may be drawn upon by the bond trustee in the event that some or all of the bonds are not remarketed as anticipated. The Series 2005 Bonds are payable from and secured by the Pledged Revenues (substantially, toll revenues derived from the operation of the Peace Bridge) and certain funds and accounts established under the Bond Resolution. Only the Pledged Revenues of the Authority are pledged as security for the Bondholders. Unpledged Revenues (i.e., revenues derived from the other contractual and lease activities) are available and are applied as received to the payment of all operating expenses of the Authority, thereby reducing the amount of Pledged Revenues required for operating expenses. Standard & Poor s Rating Services, Inc. and Fitch Ratings assigned rating of AA- / A-1+, and AA-, respectively, to the 2005 Series Bonds. Fitch Ratings maintains a public rating of A, on the Authority's debt. The Authority has no other debt outstanding. The Authority will be remarketing its existing bonds, totaling approximately $33.5 million as of July 1, Recognizing that the Authority has approximately $100 million in capital reserves, the terms and structure of the remarketing will also need to accommodate the ability to finance the Authority s long-term capital plan, as summarized below: U.S. $, in millions Description Status Total Bridge Redecking Awaiting Board approval to commence design $0.1 $5.0 $15.0 $21.0 $18.1 $13.0 $72.2 Enhancement of U.S. inspection capacity Subject to environmental analysis and results of preinspection pilot U.S. Commercial Warehouse Detailed design substantially complete Renovation U.S. Approach Widening Phase 1 under construction Other Minor projects / equipment Total $8.2 $32.6 $28.3 $33.9 $40.0 $24.7 $

7 III. SCOPE OF SERVICES A. General The Authority is seeking proposals from nationally recognized, qualified underwriters to serve as senior underwriter. In addition to being nationally recognized, the firms applying for the position of underwriter must have experience in providing senior managing underwriting services to municipal bond issuers in the transportation toll business over the past three years and have experience in fixed and variable rate debt offerings. B. Scope of Work to be Performed The underwriter will perform the following services: 1. Make recommendations as to the structure, conditions, and terms of the Authority s revenue bond issuances, including, but not limited to, fixed rate bonds, variable rate bonds, direct loans, private placement bonds, derivatives, credit enhancements, etc. 2. Assist underwriter s counsel with the preparation, and execute a bond purchase agreement with the Authority. 3. Prepare and implement a marketing program for the bonds. 4. Assist in the preparation of official statements, remarketing circulars, and other necessary financing documents. 5. Participate in meetings with the financial advisor, credit enhancers, and rating agencies, if requested. C. Term of Service The Authority reserves the right to terminate the services of the underwriter upon thirty (30) days written notice for any reason, or immediately for cause. In the event of such termination, the firm shall be entitled to compensation for acceptable services performed through the date of termination. 7

8 IV. TIME REQUIREMENTS A. Proposal Calendar The following is a list of key dates up to and including the date proposals are due to be submitted: Requests for proposals issued November 14, 2013 Due date for submission of questions Questions to be answered Due date for proposals November 21, 2013 at 1:00 PM November 22, 2013 at 5:00 PM December 11, 2013 at 1:00 PM B. Expected Notification and Contract Dates Selected firm notified January 24, 2014 Contract executed January 31, 2014 The successful firm must be prepared to commence performance for the services described herein immediately upon notice of award. 8

9 V. PROPOSAL REQUIREMENTS A. General Requirements 1. Inquiries Inquiries concerning the request for proposals and the subject of the request for proposals must be made by November 21, 2013, at 1:00 PM via to: BUFFALO & FORT ERIE PUBLIC BRIDGE AUTHORITY Attn: Lynne M. Bogdan, Finance Manager All questions and answers will be posted online at November 22, 2013, at 5:00 PM. by Contact with personnel of the Authority other than Lynne M. Bogdan, Finance Manager, regarding this request for proposals may be grounds for elimination from the selection process. 2. Addenda: Errors and Omissions - Proposers discovering any ambiguity, conflict, discrepancy, omission or other error in this RFP, should immediately notify, prior to the due date for proposals, the contact person set forth in Section V.A.1 and advise of such error and request clarification or modification of the document. Modifications to this RFP will be issued by addenda and clarifications will be communicated by written notice to each party that was furnished an RFP. If a proposer fails to notify the Authority prior to the due date for proposals, of a known error or an error that reasonably should have been known, the proposer assumes all risk. If awarded the contract, the proposer shall not be entitled to additional compensation or time by reason of the error or its late submission. 3. Submission of Proposals - The following material is required to be received by December 11, 2013, 1:00 PM for a proposing firm to be considered: a. One original Proposal, eight hard copies, and one electronic copy to include the following: (i) (ii) (iii) Title Page Title page showing the request for proposal s subject; the firm s name; the name, address, and telephone number of the contact person; and the date of the proposal. Table of Contents Transmittal Letter A signed letter of transmittal briefly stating the proposer s understanding of the work to be completed, the commitment to perform the work within the time period, a statement as to why the firm believes itself to be best qualified to perform the engagement, and a statement that the proposal is a firm and irrevocable offer. The transmittal letter should also state the name, telephone number and address of the official within the firm who will serve as the Authority s primary contact concerning the proposal. An unsigned proposal will be rejected. 9

10 (iv) Non-collusive Proposal Certification The proposer must provide a signed statement certifying the following: o o o the proposal is genuine and is not made in the interest of, or on behalf of, an undisclosed person, firm or corporation; that the proposer has not directly or indirectly induced or solicited any other proposer to submit a false or sham proposal, or decline to submit a proposal; that the proposer has not sought, by collusion, to obtain any advantage over any other proposer or over the Authority. (v) (vi) (vii) Detailed Proposal The detailed proposal should follow the order set forth in Section V. B. of this request for proposals. Cost Bid The cost bid should follow the order set forth in Section V.C. of this request for proposals. Proposers should send the completed proposal to the following address: BUFFALO & FORT ERIE PUBLIC BRIDGE AUTHORITY Attn: Lynne M. Bogdan, Finance Manager 1 Peace Bridge Plaza, Buffalo, NY B. Proposal 1. General Requirements The purpose of the proposal is to demonstrate the qualifications, competence and capacity of the firm seeking to undertake services in conformity with the requirements of this request for proposals. As such, the substance of a proposal will carry more weight than its form or manner of presentation. The proposal should demonstrate the qualifications of the firm and of the particular staff to be assigned to this engagement. It should also specify the type of service approach that will meet the request for proposal requirements. The proposal should address all the points outlined in the request for proposals. The proposal should be prepared simply and economically, providing a straightforward, concise description of the proposer s capabilities to satisfy the requirements of the request for proposals. While additional data may be presented, the following subjects, item Nos. 2 through 13, must be included. They represent the criteria against which the proposal will be evaluated. Responses are limited to fifteen (15) pages, excluding the title page, table of contents, transmittal letter, non-collusive proposal certificate and cost bid, requested resumes and official statements, prepared as single-sided pages on 8 ½ x 11 inch paper using at least 10 point type with standard margins. For clarity purposes, the Authority requests that you restate each question, with the answer stated directly below each question. 10

11 2. Independence The firm should provide an affirmative statement that it is independent of the Authority and that the firm and its staff will avoid any actual or perceived conflict of interest. Conflict of interest is defined as a situation in which a person is, or is perceived to be, in a position to benefit more preferentially than in an open market situation. 3. Scope of Work The firm should provide an affirmative statement that the proposal includes all services noted within Section III of this proposal. 4. Disciplinary Actions The firm should provide information on the circumstances and status of any disciplinary action taken or pending against the firm during the past five (5) years with federal or state regulatory bodies or professional organizations. 5. Insurance Provide evidence of existing insurance coverage, including errors and omissions, blanket crime, forgery, and theft coverage and bonding. 6. Firm Qualifications and Experience The proposer should include the following information: a. Firm name, location of firm headquarters, location of office from which services would be rendered to the Authority. b. Description of the firm, including ownership structure, number of public finance employees, number of years in business, and a brief description of the services the firm offers. Describe your direct experience in providing underwriting services to tolling authorities. c. A list (in the form noted within Appendix A with the grand total for all issuances) of the direct prior experience of your firm with all governmental entities relating to senior managing underwriter for the issuance of transportation, specifically toll revenue, new money or refunding bonds closing during the period of January 1, 2010 through October 31, Limit this list to assignments of this type. Provide the following information: i. the name of the issuer; ii. the type of issuance; iii. the size of the issuance; iv. the date of closing; and v. a description of the services rendered. d. The Authority generates between $15-18 million in cash from operations annually. Given that and the Authority s current capital reserves and capital plan (as described in Section II), describe your recommendation relative to the current revenue bonds mandatory tender on July 1, 2014 and the financing of the Authority s long-term capital plan. The analysis should include all-in costs, including interest expense, transaction fees, arbitrage, etc. The analysis should also summarize the benefits and risks of the options concerned and rationale associated with the recommendation of the method(s) of financing. For the purposes of your analysis, use MMD scales as of the close of business on November 14, e. Describe the firm s marketing plan. The marketing strategy should identify your firm's view as to the mix of potential buyers for the Authority s issue (i.e., property and 11

12 casualty, bank trust, bond fund, individual retail) and your recommended method of pre-sale marketing to maximize distribution. Describe your firm s marketing and distribution capabilities, municipal research services and any publications your firm routinely uses or distributes to inform buyers of bonds sold by New York State issuers. f. Describe the impact of proposed Federal legislation on the Municipal Bond Market and what, if any impact, it could have on the Authority. g. Indicate all instances in which your firm was dismissed as underwriter for any of your public finance clients since January 1, 2010 and the reasons therefore. 7. Professional Staff Qualifications The proposer should include the following information: a. Identification of professional staff who would be assigned to this engagement. A statement as to the availability of the lead person(s) for consultation with the Authority, including but not limited to, his or her willingness to meet in Fort Erie, ON, Canada with Authority officials. b. Description of their proposed role. c. The number of years with the firm and number of years in the public finance industry. d. Provide resumes for professional staff who would be assigned to this engagement. 8. Prior Engagements with the Buffalo & Fort Erie Public Bridge Authority List separately all engagements within the last five (5) years, with the Authority by type of engagement. Indicate the scope of work, date, the location of the firm s office from which the engagement was performed, and the name and telephone number of the principal client contact. 9. Similar Engagements with other Entities For the firm s personnel that will be assigned responsibility for this service, list the most significant engagements (maximum of 5) performed in the last five (5) years that are similar to the engagement described in this request for proposal. Indicate the scope of work, dates and duration of service and the name and telephone number of the principal client contact. From these engagements, provide at least three (3) references containing contact name, address and telephone number. 10. Value-Added Services The proposer should identify and describe services offered which may add value (i.e., decrease cost, increase efficiency, etc.) to the Authority. 11. Distinguishing Features The proposer should identify and describe the most important attributes that distinguish your firm from competing firms, and how those attributes will benefit the Authority. 12. Creative Problem Solving Describe a recent underwriting that called for creativity and your firm s approach to providing a solution to the issuer. Please be specific and focus on issues that the Authority may face in the market. 13. Identification of Anticipated Potential Problems The proposal should identify and describe any anticipated potential problems/challenges in providing the service requested, the firm s approach to resolving these problems and any special assistance that will be requested from the Authority. 12

13 C. Cost Bid 1. Fee Schedule The Authority is interested in achieving high quality services at the lowest possible cost. The Authority will not be responsible for expenses incurred in preparing and submitting the technical proposal or the cost bid. Such costs should not be included in the proposal. The following includes the required format and information to be provided by the proposer for underwriter in the Cost Bid. A proposal shall comply with all format and content requirements as detailed in this document. Failure to comply with format and content requirements may result in disqualification. The first page of the cost bid should include the following information: a. Name of Firm. b. Certification that the person signing the proposal is entitled to represent the firm, empowered to submit the bid, and authorized to sign a contract with the Authority. c. Management fee, average takedown, and expenses, excluding underwriter s counsel fees, assuming the Authority will remarket the current revenue bonds in: i. fixed rate mode; and ii. variable rate mode. d. Provide up to five examples of fees that you have charged on recent fixed rate and variable rate remarketing and new money issues. 2. Out-of-Pocket Expenses All estimated out-of-pocket expenses to be reimbursed should be presented on the second page of the cost bid. 3. Manner of Payment - Payments are contingent upon the actual issuance of bonds and will be made from the proceeds of each debt issuance. 13

14 VI. EVALUATION PROCEDURE A. Review of Proposals The Selection Committee ("Committee") will review qualifications provided in the proposals. Firms with unacceptably low technical qualifications will be eliminated from further consideration. After the qualifications for each firm have been established, the cost bid will be examined. The Authority reserves the right to retain all proposals submitted and use any idea in a proposal regardless of whether that proposal is selected. B. Evaluation Criteria Proposals will be evaluated using three sets of criteria. Firms meeting the mandatory criteria will have their proposals evaluated for both technical qualifications and price. The following represent the principal selection criteria, which will be considered during the evaluation process. 1. Mandatory Elements a. The firm is independent and has no conflict of interest with regard to any other work performed by the firm for the Authority. b. The firm adequately addresses actual and pending disciplinary actions and has a record of quality work. c. The firm maintains adequate insurance coverage. d. The firm adheres to the instructions in this request for proposal on preparing and submitting the proposal. 2. Technical Quality a. Expertise and Experience (i) (ii) (iii) (iv) The firm s qualifications and past experience and performance on similar engagements. Staff qualifications and past experience and performance on similar engagements. The firm s marketing plan and approach towards identifying and resolving potential problems/challenges in providing the services requested. The firm s distinguishing and value-added services. 3. Price Cost will not be the primary factor in the selection of Underwriter, however, it will be considered when evaluating the overall value of the proposal. The Authority is not obligated to accept the lowest bid. 14

15 C. Oral Presentations During the evaluation process, the Committee, at their discretion, may request any one or all firms to make oral presentations. Such presentations will provide firms with an opportunity to answer any questions that the Committee may have on a firm s proposal. Not all firms may be asked to make such oral presentations. D. Final Selection The Authority will select a firm based upon the recommendation of the Committee. It is anticipated that a firm will be selected by January 24, Following notification of the firm selected, it is expected that a contract will be executed between both parties by January 31, The Authority reserves the right to enter into negotiations with any proposer deemed to be best qualified in order to determine satisfactory terms and conditions of a final contract and to end such negotiations, at its discretion, and to designate and commence negotiations with an alternate best qualified proposer. In accordance with the policy approved by the Board of Directors, the Committee will not conduct debriefing sessions with unsuccessful candidates. E. Right to Reject Proposals Submission of a proposal indicates acceptance by the firm of the conditions contained in this request for proposal unless clearly and specifically noted in the proposal submitted and confirmed in the contract between the Authority and the firm selected. As specifically endorsed by the Authority Board of Directors, contact with personnel of the Authority other than Lynne M. Bogdan, Finance Manager, will result in automatic rejection of a proposal. The Authority reserves the right without prejudice to reject any or all proposals, waive any and all informalities, and the right to disregard all non-conforming or conditional proposals. The Authority reserves the right to accept any proposal deemed to be in its best interest even though the proposal is not mathematically the lowest price. 15

16 VII. APPLICABLE LAW A. This RFP, and any contract, which may subsequently arise from this RFP, shall be governed by the law of the United States of America, as applicable to an international compact entity. The appropriate jurisdiction for any disputes which arise from the RFP or any contract which may arise from this RFP, shall be the United States District Court for the Southern District of New York. B. The section titles are for convenience only and shall not be construed to affect the meanings of the sections titled. 16

17 APPENDIX A RESPONSE FORM SECTION V (B) (6) (c) Firm Name: List the direct prior experience of your firm with all governmental entities relating to senior managing underwriter for the issuance of transportation, specifically toll revenue, new money or refunding bonds closing during the period of January 1, 2010 through October 31, 2013 in the form below: Name of Issuer Type of Issuance Size of Issuance (in millions) Date of Closing Services Provided Grand Total of Issuances $ 17