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Home My WebLink AboutCOM 0342.000 2000-2002 ~~OCp JAMES Y. ARAKAKI ~ Phone: (808) 961-8272 Chairman & Presiding Officer Fax: (808) 961-8780 a^ °a •';i`-yea ~e~~`~. COUNTY COUNCIL County of Hawaii Hawaii County Building 25 Aupuni Street Hilo, Hawaii 96720 September 14, 2001 TO: Council Members FROM: James Y. Arakaki, Ch RE: Resolution relating to funding of Improvement District No. 17 Kaloko Subdivision, 1991 Special Assessment Bonds Attached is a letter dated September 6, 2001, from Mr. Hideki Hayashi, President of MID Corporation/TSA Corporation, petitioning the Council to initiate the process for refunding of Improvement District bonds for the Kaloko Subdivision pursuant to Chapter 12, Article 5 of the Hawaii County Code. The attached resolution is being introduced in response to the petition. For your information, the resolution does not include Mr. Hayashi's request that the Council approve the specific appointments of First Albany Corporation as underwriter, McCorriston Miller Mukai MacKinnon LLP, as bond counsel, and Pacific Century Trust as paying agent for the above-described refunding. It is felt that this matter can be worked out with the administration and is subject to State Procurement Rules. Att. ~ N~6 ~ ~1.~ No. _~4~~~ MID CORPORATION TSA CORPORATION 1441 Kapiolani Boulevard, Suite 1905 Honolulu, Hawaii 96814-4408 Telephone: (808) 955-1123 Fax: (808) 955-1192 September 6, 2001 County Council County of Hawaii 25 Aupuni Street Hilo, Hawaii 96720 Dear Council Members: On behalf of MID Corporation and TSA Corporation (the "Petitioners"), I am submitting the enclosed Petition requesting that the County of Hawaii (the "County") proceed with the proposed refunding of its Improvement District No. 17, Kaloko Subdivision, 1991 Special Assessment Bonds (the "Outstanding Bonds"), which are currently outstanding in the aggregate principal amount of $10,165,000 (based on information provided by the Paying Agent for the Outstanding Bonds). As set forth in the Petition, we are proposing that the Outstanding Bonds be refunded by means of a new issue of special assessment bonds (the "Refunding Bonds") which will provide the necessary funds to call the Outstanding Bonds for redemption. The Outstanding Bonds are payable from improvement assessments on properties within the County's Improvement District No. 17, Kaloko Subdivision (the "Improvement District"), including land owned by the Petitioners within the Improvement District. The Outstanding Bonds bear interest at the rate of 9.5% per annum. In view of the decline in bond interest rates since the Outstanding Bonds were originally issued, the interest costs borne by the Improvement District and its property owners can be reduced substantially through the issuance of the Refunding Bonds to redeem the Outstanding Bonds. In order to achieve these savings, the Petitioners are requesting that the County proceed with the proposed refunding as expeditiously as possible so that the Outstanding Bonds can be called for redemption on the next available redemption date, which is February 1, 2002. In order for the redemption to occur on this date, the proceeds of the Refunding Bonds must be in hand by the end of December 2001 so that timely notice of the redemption can be given to the holders of the Outstanding Bonds. In addition, the Petitioners are requesting and recommending that the following appointments be approved with respect to the proposed refunding: First Albany Corporation, as underwriter; Hawaii County Council September 6, 2001 Page 2 McCorriston Miller Mukai MacKinnon LLP, as bond counsel; and Pacific Century Trust as paying agent. The Petitioners have consulted with these firms in connection with the proposed refunding. Based on these firms' qualifications and experience in bond financing matters, the Petitioners believe that the foregoing appointments will facilitate the proper implementation of the proposed refunding. Thank you for your attention to this matter. We hope that you will agree that the proposed refunding will be highly beneficial and that the refunding process can move forward expeditiously so that these benefits can be fully realized. Please feel free to contact me if any further information is required. Very truly yours, Hideki H ashi, President PETITION FOR REFUNDING OF OUTSTANDING INDEBTEDNESS OF COUNTY OF HAWAII IMPROVEMENT DISTRICT NO. 17, KALOKO SUBDIVISION County Council of the County of Hawaii 25 Aupuni Street Hilo, Hawaii 96720 Pursuant to Section 12-59(a) of the Hawaii County Code, the undersigned Petitioners (the "Petitioners"), being the owners of certain land located within Improvement District No. 17 (the "Improvement District") heretofore established by the County of Hawaii (the "County"), hereby petition the County Council (the "Council") to approve and proceed with a refunding of the outstanding indebtedness of the Improvement District and the issuance of refunding bonds for such purpose, all as hereinafter set forth. Section 1. The Petitioners. The Petitioners are the owners in fee simple of land within the Improvement District which represent, in the aggregate, not less than 75% of the outstanding improvement assessments on properties within the Improvement District. As such, the Petitioners are proper and sufficient parties to this Petition pursuant to the provisions of Section 12-59(a) of the Hawaii County Code. Section 2. Outstanding Indebtedness of the Improvement District. The outstanding indebtedness of the Improvement District consists of $10,165,000 outstanding principal amount of the County's Improvement DistrictNo.17, Kaloko Subdivision,1991 Special Assessment Bonds (the "Outstanding Bonds") previously issued pursuant to Chapter 12 of the Hawaii County Code. The Outstanding Bonds bear interest at the rate of 9.5% per annum and mature on August 1, 2011. The principal of and interest on the Outstanding Bonds are payable from improvement assessments on properties within the Improvement District. Section 3. Petitioners' Desire to Refund Outstanding Bonds. The Outstanding Bonds are subject to refunding under Chapter 12, Article 5, of the Hawaii County Code. In view of the decline in bond interest rates since the issuance of the Outstanding Bonds, it is the desire of the Petitioners that the Outstanding Bonds be refunded in order to achieve savings in the interest costs associated with such Outstanding Bonds. Section 4. Proposed Method of Refunding. The Petitioners propose that the Outstanding Bonds be refunded by means of the issuance of a new series of special assessment bonds (the "Refunding Bonds") as follows: (a) Redemption of Outstanding- Bonds. The Outstanding Bonds are subject to redemption, upon not less than 25 days' notice, on February 1 and August 1 of each year. The Petitioners propose that the Outstanding Bonds be redeemed on the next available redemption date (which is February 1, 2002) at the applicable redemption price of 103% of the principal amount thereof, plus accrued interest to the redemption date. (b) Proposed Issuance of Refunding„Bonds. The Petitioners propose that the Refunding Bonds be issued in a principal amount sufficient to provide the funds required to redeem the Outstanding Bonds, pay associated costs of issuance and establish such reserves (if any) as may be required with respect to the Refunding Bonds. In order to redeem the Outstanding Bonds on the next available redemption date, the Petitioners propose that the Refunding Bonds be issued as soon as practicable, and not later than December 31, 2001, to permit the timely giving of notice of the redemption of the Outstanding Bonds to the holders thereof. (c) Nature of Refunding Bonds. The Refunding Bonds shall be limited obligations of the County, payable solely from improvement assessments on properties within the Improvement District and from certain funds and accounts to be established for the Refunding Bonds. Neither the full faith and credit nor the taxing power (except for the aforesaid improvement assessments) of the County shall be pledged to the payment of the Refunding Bonds. Section 5. Request for Action by Council. The Petitioners respectfully request that the Council take, and authorize the taking of, all necessary and proper actions to approve and proceed with the refunding of the Outstanding Bonds and the issuance of the Refunding Bonds for purposes of such refunding pursuant to Chapter 12, Article 5, of the Hawaii County Code. Without limiting the generality of the foregoing, the Petitioners hereby request that the Council, by all appropriate proceedings: (a) direct the Chief Engineer to investigate and report on matters relating to the proposed refunding, as provided in Section 12-59(b) of the Hawaii County Code; (b) adopt the refunding plan and authorize the issuance of the Refunding Bonds as proposed by the Petitioners; and (c) approve the appointment of First Albany Corporation as underwriter, McCorriston Miller Mukai MacKinnon LLP as bond counsel, and Pacific Century Trust as paying agent, as requested and recommended by the Petitioners with respect to the Refunding Bonds. IN W ITNESS WHEREOF, the undersigned Petitioners respectful ly submit this Petition pursuant to Section 12-59(a) of the Hawaii County Code as of this 6th day of September, 2001. MID CORPORATION, a Hawaii Corporation By: ' Hideki Hay i, President TSA CORPORATION, a Hawaii Corporation By: C Hideki Hayas ,President 2 JAMES Y. ARAKAKI ~`v,°` AARON S.Y. CHUNG Chairman & Presiding (~cer ~ ` ~ BOBBY JEAN LEITHEAD-TODD ,c LENINGRAD ELARIONOFF J. CURTIS TYLER, III JULIE JACOBSON Vice Chairman ~ ;:~P~` NANCY PISICCHIO GARY SAFARIK DOMINIC YAGONG COUNTY COUNCIL County of Hawaii Hawaii County Building 15 Aupuni Street Hilo, Hawaii 96720 September 13, 2001 James Y. Arakaki, Chair Hawaii County Council 25 Aupuni Street Hilo, Hawaii 96720 RE: RESOLUTION REGARDING THE PROPOSED REFUNDING OF INDEBTEDNESS OF IMPROVEMENT DISTRICT NO. 17, KALOKO SUBDIVISION Pursuant to Section 1(g) of Rule ~ of the Rules of Procedure of the Council of the County of Hawaii, this written request is submitted with my approval that the above-referenced matter be waived from the Committee on Finance to the full Council for immediate action. In reviewing this matter, timely approval is crucial. It is therefore advantageous that approval is granted and the matter placed onto the next Council agenda for review. However, in the event this request is denied, for whatever reason, I understand the matter shall be referred to the Committee on Finance for placement on its future agenda. Since y, - Aaron S.Y. Chung, hair Committee on Finance pprov i~ate/W 've to C ncil: Disapproved/Date/Refer to FC: Jame Y. akaki, Chair James Y. Arakaki, Chair H ai'i County Council Hawaii County Council