10/23/2015 Finance Committee Meeting Packet Finance Committee Agenda
October 23, 2015
County Manager's Front Conference Room
10:00 a.m.
1. Call to order
2. Approval of Agenda (meeting noticed on October 16, 2015)
3. Approval of Minutes from September 1, 2015 Meeting
4. General Discussion on Capital Project Planning through FY 2019 and related Capital Project Financing
Stategies
5. Other Business
6. Public Comment
7. Adjourn—Next Meeting—TBD
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Collier County Government , ° ;�-
Communication & Customer Relations
3299 Tamiami Trail East, Suite 102 colliergov.net
Naples, FL 34112-5746 twitter.com/CollierPIO
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October 16, 2015
FOR IMMEDIATE RELEASE
NOTICE OF PUBLIC MEETING
COLLIER COUNTY FINANCE COMMITTEE
COLLIER COUNTY, FLORIDA
FRIDAY, OCTOBER 23, 2015
10:00 A.M.
Notice is hereby given that the Collier County Finance Committee will meet Friday, October 23, at 10:00
a.m. in the County Manager's Front Conference Room, second floor, Collier County Government Center,
3299 Tamiami Trail East, Naples, Fla.
About the public meeting:
Two or more members of the Board of County Commissioners may be present and may participate at the
meeting. The subject matter of this meeting may be an item for discussion and action at a future Board of
County Commissioners meeting.
All interested parties are invited to attend, and to register to speak. All registered public speakers will be
limited to three minutes unless permission for additional time is granted by the chairman.
Collier County Ordinance No. 2004-05 requires that all lobbyists shall, before engaging in any lobbying
activities (including, but not limited to, addressing the Board of County Commissioners, an advisory board
or quasi-judicial board), register with the Clerk to the Board at the Board Minutes and Records Department.
Anyone who requires an auxiliary aid or service for effective communication, or other reasonable
accommodations in order to participate in this proceeding, should contact the Collier County Facilities
Management Department located at 3335 Tamiami Trail East,Naples, Florida 34112, or (239) 252-8380 as
soon as possible, but no later than 48 hours before the scheduled event. Such reasonable accommodations
will be provided at no cost to the individual.
For more information, call Mark Isackson at (239) 252-8973.
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DRAFT
COLLIER COUNTY
FINANCE COMMITTEE MEETING
MINUTES
September 1, 2015, 9:00 A.M.
In attendance: Mark Isackson, Corporate Financial Operations CMO; Crystal Kinzel, Clerk of Courts Finance Director;
Derek Johnssen, Clerk of Courts Assistant Finance Director; Joe Bellone, Director of Operations Support-Public Utilities;
Laura Zautcke, Senior Budget Analyst, Public Utilities Operations; Jeff Klatzkow, County Attorney; Jim Gibson; Gene
Shue-Growth Management Operations Support Director.
Present by phone: Sergio Masvidal and Nicklas Rocca from the PFM Group; Steve Miller from Nabors, Giblin
1. Call to Order: Mark Isackson called the meeting to order at 9:00 a.m.
2. Approve Agenda: Meeting noticed August 26, 2015. Motion to approve agenda. Unanimously approved.
3. Approval of Minutes from the August 14, 2015 meeting: Motion to approve minutes. Unanimously approved.
4. 2015 Refunding of Series 2006 Water and Sewer Bonds maturing 2017-2022 review bids: Bank of America will hold
the interest rate with rate lock cost at 1.75 thru September 22, 2015 Board approval. Steve Miller will review rate
lock agreement with Mark Raymond at Bank of America and then send a final draft to Jeff Klatzkow to review. The
agreement needs some default parameters defined and Sergio Masvidal will talk to Holly at Bank of America on
these. Joe Bellone will prepare the Executive Summary stating the interest rate, savings and award for the BOCC
meeting on September 8, 2015. The contract documents need to be to Joe Bellone by September 14, 2015 at the
latest to be on the September 22, 2015 Agenda. Mark Isackson suggested that all banks be ranked by interest rate
in case deal with Bank of America falls thru to keep the selection processing going. Pre-rate lock ranking is #1 Bank
of America 1.71%; #2 J. P. Morgan 1.9%; #3 US Bank 2.03%; #4 First Florida Integrity 2.25%; #5 Suntrust 2.26%. Mark
Isackson motioned to approve ranking of banks as stated and Joe Bellone second. Unanimously approved.
5. Consideration of new Finance Committee Member recommendation to include Gene Shue with Growth
Management Division effective as of next meeting. Mark Isackson motioned to approve and Joe Bellone second.
Unanimously approved.
6. Other Business None
7. Public Comment: None
8. Adjourn: Meeting adjourned at 9:36 a.m. Motioned by Crystal Kinzel and seconded by Joe Bellone. Unanimously
approved.
FINAL
COLLIER COUNTY
FINANCE COMMITTEE MEETING
MINUTES
September 1, 2015, 9:00 A.M.
In attendance: Mark Isackson, Corporate Financial Operations CMO; Crystal Kinzel, Clerk of Courts Finance Director;
Derek Johnssen, Clerk of Courts Assistant Finance Director; Joe Bellone, Director of Operations Support-Public Utilities;
Laura Zautcke, Senior Budget Analyst, Public Utilities Operations; Jeff Klatzkow, County Attorney; Jim Gibson; Gene
Shue-Growth Management Operations Support Director.
Present by phone: Sergio Masvidal and Nicklas Rocca from the PFM Group; Steve Miller from Nabors,Giblin
1. Call to Order: Mark Isackson called the meeting to order at 9:00 a.m.
2. Approve Agenda: Meeting noticed August 26, 2015. Motion to approve agenda. Unanimously approved.
3. Approval of Minutes from the August 14, 2015 meeting: Motion to approve minutes. Unanimously approved.
4. 2015 Refunding of Series 2006 Water and Sewer Bonds maturing 2017-2022 review bids: Bank of America will hold
the interest rate with rate lock cost at 1.75 thru September 22, 2015 Board approval. Steve Miller will review rate
lock agreement with Mark Raymond at Bank of America and then send a final draft to Jeff Klatzkow to review. The
agreement needs some default parameters defined and Sergio Masvidal will talk to Holly at Bank of America on
these. Joe Bellone will prepare the Executive Summary stating the interest rate, savings and award for the BOCC
meeting on September 8, 2015. The contract documents need to be to Joe Bellone by September 14, 2015 at the
latest to be on the September 22, 2015 Agenda. Mark Isackson suggested that all banks be ranked by interest rate
in case deal with Bank of America falls thru to keep the selection processing going. Pre-rate lock ranking is #1 Bank
of America 1.71%;#2 J. P. Morgan 1.9%;#3 US Bank 2.03%;#4 First Florida Integrity 2.25%;#5 Suntrust 2.26%. Mark
Isackson motioned to approve ranking of banks as stated and Joe Bellone second. Unanimously approved.
5. Consideration of new Finance Committee Member recommendation to include Gene Shue with Growth
Management Division effective as of next meeting. Mark Isackson motioned to approve and Joe Bellone second.
Unanimously approved.
6. Other Business None
7. Public Comment: None
8. Adjourn: Meeting adjourned at 9:36 a.m. Motioned by Crystal Kinzel and seconded by Joe Bellone. Unanimously
approved.
PFM255 Alhambra Circle,Suite 404
mot
Coral Gables,FL 33134
The PFM Group 305-448-6992
Public Financial Management,Inc. www.pfm.com
PFM Asset Management LLC
PFM Advisors
October 20,2015
Memorandum
To: Collier County
From: Sergio Masvidal,Public Financial Management
Nicklas Rocca,Public Financial Management
Re: Collier County— Future Capital Projects Financing Analysis
Based on recent conversations it is our understanding that the county will spend $150M on capital
projects between FY 2016 and FY 2019. $50-$75M of the total capital project amount is expected
to be spent within the next 2 years. PFM will analyze and create a summary of the following
financing options for the capital projects financing(s). The primary consideration that will be
evaluated is the cost-benefit, and risk, of one versus multiple borrowings in light of the current low
interest rate environment. While the future of interest rates are uncertain, the analysis is intended to
provide the committee with a reasonable range of potential outcomes that can be used to make an
informed borrowing decision. The decision point for the County will largely be based on the
amount of estimated interest rate"cushion"versus consensus thoughts on future interest rates.
The results of the analysis will be provided for discussion at the next committee meeting.
Scenarios to be analyzed:
(1) Borrow the full $150M amount in FY 2016 that is reasonably expected to be spent over
the next 2-3 years in one bond financing.
Considerations:
- If the County borrows the full amount upfront there will be a certain amount of negative
arbitrage in the construction fund (difference between the investment rate and
borrowing cost, calculated monthly as expenditures are made). PFM will estimate the
amount of negative arbitrage incurred over the [2-3 year] construction schedule based on
current market conditions.
(2) Borrow$75M in FY 2016 and wait to borrow the remainder of the project proceeds in
2 years with a second bond financing.
Considerations:
- Borrowing in multiple series provides interest rate certainty in the first series, however
includes interest rate uncertainty for the second borrowing.
- Initial borrowing will be sized using current market rates. Second financing will assume
interest rates increase 50-100bps.
+ " October 20,2015
4iimeestP Page 2
- Include a variation of this financing approach which assumes issuing the first series of
bonds with longer maturity dates (years 15-30), then come back and fill in the earlier
years (years 3-14) with the second financing. Strategy here would be to take advantage
of a flatter yield curve and lock-in the longer part of the curve.
- For both variations include the "breakeven" of magnitude of interest rate increase
necessary to equal the amount of negative arbitrage estimated in (1) above.
(3) Borrow as required by the monthly cash flow needs through a Commercial Paper
program, then refinance the Commercial Paper with one long-term bond financing in 2-
3 years.
Considerations:
- Run analysis assuming rates:
(a) Stay the same at the time of conversion
(b) Increase 50-100 bps
(c) Breakeven rate increase