HomeMy WebLinkAboutCOM 1145.000 2004-2006
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Harry Kim William Takaba
Mayor Director
Nancy E. Crawford
t` DeputyDirector
County of Hawaii
Finance Department
25 Aupuni Street, Room 118 • Hilo, Hawaii 96720
(808) 961-8234 • Pax (808) 961-8248
October 17, 2006
Stacy Higa, Chairman, and
Members of the Hawaii County Council
25 Aupuni Street
Hilo, HI 96720
Subject: Bill for an Ordinance Authorizing the Issuance of General Obligation Bonds
Attached for your consideration is a bill authorizing the issuance of up to $75 million in
general obligation bonds for the County of Hawaii. We are also requesting authorization
to issue bonds in an amount not to exceed $55 million for the purpose of refunding
outstanding bonds that were issued at higher interest rate. It is anticipated that the bonds
will be sold in January 2007.
New Bonds Projects
We currently have four large projects that have been initiated and which require funding
to continue. The projects are West Hawaii Civic Center, County Building Repairs,
La'i'opua Connector Road, and ADA Compliance. These projects are necessary to meet
legal mandates, provide needed repairs and new construction, and continue traffic
improvements. All are expected to require funding within the next three months. An
explanation of each project is included in the attached Exhibit A.
Existing Bonds Project Status
Many other projects are progressing using previously acquired funds. In January 2006 the
County Council authorized a bond issuance which included $25 million for various
County projects. Approximately half of the funds have been allotted for projects,
including ADA Compliance, Central Police Station Repairs, County Building Repairs,
Repairs to Parks and Recreation Facilities, Konawaena Swimming Pool, Pahoa Fire
Station, Palani Road Safety Improvements, and Ahalanui/Pohoiki Beach Park.
It is anticipated that the remaining funds from the 2006A bond issue will be allotted
within the next three months for additional ADA improvements, Large Capacity
Cesspool Replacements, Fire Administration Complex design, purchase of Na'alehu
Park, Roof Replacement on Public Safety Buildings, and other projects. ( S
Comm. No.---
('13 ~u 35$~ Havai'iCounty is an equal opportunityprovider and employer. Ref. To:
Ref. Dote
Stacy Higa, Chairman, and
Members of the Hawaii County Council
Page 2
October 17, 2006
Road projects currently in progress, funded with 2004A bond proceeds include La'aloa
Extension to Kuakini, Honalo/Captain Cook, Highway 137 and Pohoiki Bypass.
Office of the Prosecuting Attorney, Upgrade of Rural Transfer Stations, Repairs to Parks
and Recreation Facilities, and Captain Cook Fire Station Extension are among the other
bond-funded projects currently in progress.
Refunding Bonds
Bonds being considered for advance refunding are in Series 1999A and 2001 A. At
current interest rates the County would realize a savings on future debt service for these
issues. Rates will continue to be monitored up to the day of sale to insure that refunding
is in the best interest of the County.
Debt Service
The Department of Finance is working with departments to insure that funding will be
available when needed, but not borrowed prematurely. Although there are many needed
improvements, the number of projects to be funded is limited by prudent spending
amounts and the capacity of the departments to manage the projects. If the County sells
bonds in the amount of $75 million, the estimated percentage of debt service to total
general expenditures will be less than 11.8%, assuming a 4.5% interest rate. Exhibits B
and C are debt service worksheets for your review.
Please contact departments directly for additional information on specific projects. If
there are any questions regarding the bonds, please do not hesitate to contact Mike
Okumoto at 961-8303 or me at 961-8234. Thank you very much.
lei` Willi akaba
Director of Finance
APPROVED:
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Harry Kim
Mayor
Attachments
Exhibit A
2007 Series A Bond Request
New Money Projects
Total bond authorization requested is $75,000,000, which includes an estimate of
$1,000,000 for bond issuance costs. Any realized savings on issuance costs will
be applied to the projects.
West Hawai'i Civic Center - $41,500,000
The project will provide a new 62,000 square foot office complex in North Kona to
house a majority of the existing County agencies currently renting or leasing
office space at various scattered locations. The County will be able to offer the
residents of West Hawai'i a centralized complex where they can access
governmental services. The West Hawai'i Civic Center project was appropriated
by County Council for $42 million. This amount has not been previously included
in a bond authorization, and it is being requested at this time.
County Building Repairs - $20,100,000
The project is necessary for the continued use of the facility. It will combine
asbestos abatement, roof repair, air conditioning system replacement, electrical
upgrades, fire alarm and suppression system, hurricane and seismic
improvements, and office space enhancement, plus other miscellaneous
improvements. Accessibility requirements will also be addressed during the
project to insure compliance with Russell et al v. County of Hawai'i. The project
was appropriated by County Council for $26 million. Funding of $5.5 million for
the project was anticipated in the 2006A bonds. We are currently requesting
authorization to borrow $20.1 million to fund the remaining appropriation.
La'i'opua Connector Road - $9,700,000
This road will provide a needed connection between Kealakehe Parkway and
Kealaka'a Street. The connector road will provide an alternative route between
Queen Ka'ahumanu Highway and Palani Road and between the Kealakehe High
School and Kealakehe Elementary/Intermediate Schools, which will relieve
congestion at the Palani Road and Queen Ka'ahumanu intersection. Project
estimates of $7.6 million have been appropriated for La'i'opua Connector Road.
It is anticipated that an additional $2.1 million will be required to complete the
project. The total amount of $9.7 million is requested in this bond authorization.
ADA Compliance - $2,700,000
The County is continuing with the on-going process of complying with
accessibility obligations as set forth in the consent decree filed in Russell et al v.
County of Hawai'i. Approximately $5.2 million is currently appropriated for
various projects, which include roadway curb cuts, parks and recreation facility
access through removal of architectural barriers, and access improvements at
other County facilities.
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Exhibit C
Debt Service Projection
Principal amount: 75,000,000
Interest rate: 4.5%
Year Payment Interest Principal Balance
75, 000, 000
1 5,765,711 3,375,000 2,390,711 72,609,289
2 5,765,711 3,267,418 2,498,293 70,110,996
3 5,765,711 3,154,995 2,610,716 67,500,280
4 5,765,711 3,037,513 2,728,198 64,772,082
5 5,765,711 2,914,744 2,850,967 61,921,115
6 5,765,711 2,786,450 2,979,261 58,941,854
7 5,765,711 2,652,383 3,113,327 55,828,527
8 5,765,711 2,512,284 3,253,427 52,575,100
9 5,765,711 2,365,879 3,399,831 49,175,269
10 5,765,711 2,212,887 3,552,824 45,622,445
11 5,765,711 2,053,010 3,712,701 41,909,744
12 5,765,711 1,885,938 3,879,772 38,029,972
13 5,765,711 1,711,349 4,054,362 33,975,610
14 5,765,711 1,528,902 4,236,808 29,738,801
15 5,765,711 1,338,246 4,427,465 25,311,336
16 5,765,711 1,139,010 4,626,701 20,684,636
17 5,765,711 930,809 4,834,902 15,849,734
18 5,765,711 713,238 5,052,473 10,797,261
19 5,765,711 485,877 5,279,834 5,517,427
20 5,765,711 248,284 5,517,427 (0)
115,314,216 40,314,216 75,000,000