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HomeMy WebLinkAboutC.054.93008_1892 (2)114,> RESOLUTION REGARDING A PROPOSED PURCHASE AND RENOVATION AND FINANCING ARRANGEMENT OF A HEALTH DEPARTMENT WHEREAS, the Iredell County Board of Commissioners desires to purchase a building and renovate it for a health department to better serve the citizens of Iredell County: and WHEREAS, the Iredell County Board of Commissioners desires to finance the construction of the necessary facility for the health department by installment contract with a financial institution. and WHEREAS, the Local Government Commission of the North Carolina Department of the State Treasurer reauires that the Iredell County Board of Commissioners makes certain findings before the Commission can grant approval to the County's application for approval of this particular install- ment contract as authorized under North Carolina General Statute 160A, Article 3, Section 20: THEREFORE, BE IT RESOLVED that the Board of Commissioners of Iredell County, North Carolina in a Regular Meeting of the Board finds as follows: 1. The proposed project is the purchase and renovation of a building to function as a health department. The proposed method of financing is a fifteen -year installment contract between the County and a financial institution for the full amount of the purchase price plus renovations. 2. The purchase and renovation of the building to be used as a health department is necessary because the existing health department building, which was built in 1955, lacks sufficient space to t„ efficiently and professionally provide services to the citizens of Iredell County. The overcrowded facilities at the existing building have forced the County to lease space at two additional in -town . locations. Upon completion of the new facility, all health department services will be offered at one location. 3. The proposed construction of the health department is $3,400,000, which includes purchase of the building and land, design, and renovations. The County will give a Deed of Trust to the financial institution to fully collateralize the installment -purchase contract and no deficiency judgment will be allowed in the event the County defaults on payments. Using this method of finan- cing, there will be absolutely no pledge of the County's taxing authority. 4. The County Attorney has rendered an opinion that the project is authorized by law and is a purpose for which public funds may be expended pursuant to the Constitution and laws of North Carolina at this time. 5. Because of the expeditious nature of this project and the relatively small nature of the project cost, the proposed installment contract is preferable to alternative financing mechanisms as follows: a. Current appropriations in the County's operating Budget are inadeauate to fund this project. b. Currently fund balance available for appropriation is not sufficient to fund the project. c. The County does not retire enough debt annuall,v to fund this project using the "two-thirds limitations." d. The proposed financing is preferable to a General Obligation Bond because the costs of authorizing and issuing bonds would be areater than those associated with the installment contract. e. Revenue Bonds are inappropriate for this project. 6. After receiving competitive bids for financing the project the board of commissioners has chosen, upon Local Government Commission approval, to finance the total cost of the project with First Union National Bank for fifteen years at 7.26% interest. The total cost of the financing agreement is $5,439,131, including principal and interest. The interest rate compares favorably to interest rates of recent general obligation bond issues. 7. Examination of the audited financial statements for the past three fiscal years of Iredell County will show that the County's debt management policies are in strict compliance with North Carolina law. B. No increase in the property tax rate will be necessary to raise sums to fall due under this contract in each fiscal year during the term of the contract. Funding for the debt service payments will be through annual appropriation in the operating budget for the General Fund. 9. The County is neither in default nor has it ever been in default in meeting its debt service obligations. 10. The County solicited proposals from five local financial institutions to ensure the County was receiving the most favorable terms and interest rates. 11. The Board of County Commissioners hereby directs the finance officer to file an application with the Local Government Commission for the project as described.