HomeMy WebLinkAbout070-26 (RefinancingOfVirginiaReourcesAuthority(VRA)Bonds) RESOLUTION BY THE FREDERICK COUNTY BOARD OF SUPERVISORS
AUTHORIZING THE REFINANCING OF CERTAIN OBLIGATIONS OWED TO THE
VIRGINIA RESOURCES AUTHORITY
The Board of Supervisors of Frederick County,in regular meeting on the 11 th day of March, 2026,
adopted the following:
WHEREAS,Frederick County(the"County")has previously entered into the following financing
arrangements with the Virginia Resources Authority ("VRA"): (a) Local Lease Acquisition
Agreement and Financing Lease dated as of June 26, 2014 (the "201413 Lease"), (b) Local Lease
Acquisition Agreement and Financing Lease dated as of April 10, 2015 (the "2015A Lease"), and
(c)Local Lease Acquisition Agreement and Financing Lease dated as of June 25,2015(the"201513
Lease," and together with the 2014B Lease and the 2015A Lease, the "Prior Leases");
WHEREAS, VRA has approached the County with an opportunity to refinance the County's
obligations under some or all of the Prior Leases, which refinancing would reduce the annual
payments of the County under the Prior Leases;
WHEREAS,the Board of Supervisors of Frederick County desires to authorize the refinancing of
the County's obligations under the Prior Leases and the financing of the costs of issuance related
to the refinancing (collectively, the "Refinancing Project");
WHEREAS,no public hearing is required for the Refinancing Project under the Virginia Code;
WHEREAS,the VRA has indicated its willingness to provide funds to undertake the Refinancing
Project by amending (or amending and restating) the applicable Prior Lease (each Prior Lease as
amended or as amended and restated, a"Financing Lease"), and VRA would make funds available
from the proceeds of one or more series of its Infrastructure and State Moral Obligation Revenue
Bonds (Virginia Pooled Financing Program) (the "VRA Bonds");
WHEREAS, the Financing Lease is expected to indicate that the proceeds requested from VRA
(the "Proceeds Requested")will be an amount sufficient to refund,redeem and defease the portions
of the Prior Leases designated for refinancing and pay cost of issuance,all subject to the parameters
herein;
WHEREAS,the date of the sale of the VRA Bonds is referred to as the "VRA Sale Date;"
WHEREAS,VRA has informed the County that VRA's objective is to pay the County a purchase
price for each Financing Lease that in VRA's judgment reflects its market value (the "Purchase
Price Objective") taking into consideration the Proceeds Requested and such factors as the
purchase price received by VRA for the VRA Bonds, the issuance costs of the VRA Bonds
(consisting of the underwriters'discount and other costs incurred by VRA)(collectively,the"VRA
Costs") and other market conditions relating to the sale of the VRA Bonds;
WHEREAS, such factors are expected to result in the County receiving a purchase price other
than the par amount of the respective Financing Lease and consequently(i)the aggregate principal
amount of each Financing Lease may be greater than or less than the Proceeds Requested in order
to receive an amount of proceeds that is substantially equal to the Proceeds Requested or(ii) the
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County may receive less than the Proceeds Requested if the financing parameters established under
Section 1, Section 4 or Section 5 of this Resolution restrict the principal amount of the Financing
Lease such that the maximum principal amount of the Financing Lease does not exceed the
Proceeds Requested by at least the amount of the VRA Costs and any original issue discount, the
amount to be paid to the County, given the Purchase Price Objective and market conditions; and
NOW, THEREFORE,BE IT RESOLVED BY THE BOARD OF SUPERVISORS OF THE
COUNTY OF FREDERICK,VIRGINIA, AS FOLLOWS:
1. Authorization of Lease Financin,. The Board hereby determines that it is necessary and
advisable and will benefit the residents of the County through the promotion of their health, safety
and welfare to enter into one or more Financing Leases with VRA to undertake the Refunding
Project. The Refunding Project is hereby authorized on the terms and conditions set forth herein
and in the applicable Financing Lease. The proceeds from the Financing Lease shall be used to
pay all or a portion of the Refunding Project. The Refunding Project may be conducted in one or
more series with appropriate nomenclature and series designations, as determined by the County
Administrator(the "County Representative").
2. Authorization of County Representative. The County Representative is hereby authorized
and directed to determine the final forms of the Financing Leases and related lease documents
provided they are substantially similar to existing financing lease arrangements with VRA and to
execute the Financing Leases and related lease documents in such form, with such completions,
omissions, insertions and changes not inconsistent with this Resolution as may be approved by the
County Representative, whose approval shall be evidenced conclusively by the execution and
delivery thereof.
3. Rental Payments Subject to A ro nation. The County's obligation to make the rental
payments under the Financing Leases and all other payments pursuant to those documents is
hereby specifically stated to be subject to annual appropriation therefor by the Board, and nothing
in this resolution or the Financing Leases shall constitute a pledge of the full faith and credit nor
taxing power of the County or compel the Board to make any such appropriation.
4. Refundiniz of the Prior Leases. The refunding of all or a portion of the Prior Leases shall
be executed as follows:
(a) the Board hereby authorizes and directs the County Representative to cause the
Prior Leases to be refunded to be called for optional redemption on its earliest optional redemption
date required under applicable federal tax law; and
(b) the County hereby authorizes the County Representative or VRA (as applicable)to
cause to be prepared and to execute and deliver an escrow agreement or agreements with an escrow
agent or escrow agents to be selected by the County Representative or VRA (as applicable)
providing for the irrevocable deposit of the proceeds of each Financing Lease in amounts
sufficient,when invested as set forth in the escrow agreement(s),to provide for the payment of the
principal of, premium, if any, and interest on the refunded Prior Lease.
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5. Parameters for undertaking the Refundin< Project. (a) The County Representative is
hereby authorized to determine whether to undertake the Refunding Project at any time and from
time to time in connection with one or more of VRA's Virginia Pooled Financing Programs;
provided that the parameters set forth in(b)below are satisfied.
(b) The Board hereby authorizes the Refunding Project to or at the direction of VRA
on terms that VRA shall determine subject to VRA's Purchase Price Objective and market
conditions described in the Recitals hereof; provided, however, that (i) each occasion that the
County enters into a Financing Lease shall generate a net present value savings of at least 4.5% of
the principal components of the Prior Lease being refunded, and (ii) each Financing Lease shall
be payable in principal installments ending no later than the last fiscal year that a Prior Lease being
refunded matures.
(c) Subject to the parameters in subsection (b), the County further authorizes the
County Representative to accept the final terms presented by VRA, including the final principal
amount and the amortization schedule (including the principal installment dates and amounts) of
each Financing Lease.
(d) The actions of the County Representative in determining the final terms of each
Financing Lease shall be conclusive, and no further action shall be necessary on the part of the
Board. As set forth in the Financing Lease, the Board agrees to pay such "supplemental interest"
and other charges as provided therein, including such amounts as may be necessary to maintain or
replenish the VRA Reserve. The payment on the Financing Lease shall be payable in lawful
money of the United States of America.
6. Execution of Documents. The County Representative is hereby authorized and directed to
execute the Financing Lease and the other lease documents, and the Clerk of the Board (the
"Clerk") is hereby authorized and directed to affix the seal of the County thereto. The County
Representative is hereby authorized and directed to deliver the Financing Lease and the other lease
documents to or at the direction of VRA upon payment of the purchase price therefor.
7. Official Statement. The County authorizes and consents to the inclusion if necessary of
information with respect to the County contained in VRA's Preliminary Official Statement and
VRA's Official Statement in final form, both prepared in connection with the sale of the VRA
Bonds. If appropriate, such disclosure documents shall be distributed in such manner and at such
times as any of them shall determine. The County Representative is authorized and directed to
take whatever actions are necessary or appropriate to aid VRA in ensuring compliance with
Securities and Exchange Commission Rule 15c2-12.
S. Further Actions: Authorization of County Representative. The County Representative and
such officers and agents of the County as may be designated by the County Representative, are
hereby authorized and directed to take such further action as they deem necessary or appropriate
regarding the delivery of the Financing Lease,including necessary steps to qualify or register them
for sale in one or more jurisdictions and to secure credit enhancement therefor. All actions
previously taken by the County Representative and such officers and agents in connection with the
delivery of the Financing Lease are hereby ratified and confirmed. The authorizations granted in
this Resolution to the County Administrator and the Clerk may be carried out by the Deputy,
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Interim or Acting County Administrator and any Assistant or Deputy Clerk, respectively, in the
absence of the primary officers.
9. SNAP Investment Authorization. The Board authorizes the Treasurer to have the option
to utilize the State Non-Arbitrage Program of the Commonwealth of Virginia ("SNAP") in
connection with the investment of the proceeds of the Financing Lease. The Board acknowledges
that the Treasury Board of the Commonwealth of Virginia is not, and shall not be, in any way
liable to the County in connection with SNAP, except as otherwise provided in the contract
creating the investment program pool.
10. Effective Date; Expiration of Authorization. This Resolution shall take effect from and
after its adoption. The authorization to enter into a Financing Lease shall expire on June 30, 2027,
but all other provisions of this Resolution shall remain in full force and effect.
Passed this 11ffi day of March 2026 by the following recorded vote:
John F. Jewell, Chairman Aye Jason C. Aikens Aye
Albert L. Omdorff Aye Robert W. Wells Aye
Michael D. Guevremont Aye Robert T. Liero Aye
Gary R. Oates Aye
A COPY ATTEST
Michael Bollhoe t'4y'
Frederick Couni v/Administrator
No. 070-26
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COUNTY of FREDERICK
wW ® Michael Bollhoefer
County Administrator
``uri:v4
1739 540/665-63 82
Fax: 540/667-0370
E-mail: michael.bollhoefer@fcva.us
TO: Frederick County Board of Supervisors
FROM: Mike Bollhoefer, County Administrator
SUBJECT: Refunding Bonds
DATE: March 6, 2026
As discussed at the Board's regular meeting on February 11, 2026, the County has the
opportunity to save approximately $100,000 per year for the next 10 years by refunding
(refinancing)three outstanding loans. The upfront costs to accomplish this would be
approximately $40,000 for the bond counsel. At the referenced meeting,the Board authorized
staff to move forward with this process.
The draft Resolution Authorizing the Refinancing of Certain Obligations Owed to the Virginia
Resources Authority is attached for your review and adoption.
Attachments: 1. Refunding summary
2. Timeline
3. Draft Resolution
107 North Kent Street 0 Winchester, Virginia 22601
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VRA Refundings
Virginia Resources Authority
Virginia Pooled Financing Program
Series 2026A(Spring VPFP)
As of February 6,2026
FEB 2026 MARCH 2O26 APRIL 2026 MAY 2026
M T W T F M T W T F M T W T F M T W T F
2 3 4 5 6 2 3 4 5 6 1 2 3 1
9 10 11 12 13 9 10 11 12 13 6 7 8 9 10 4 5 6 7 8
16 17 18 19 20 16 17 18 19 20 13 14 15 16 17 11 12 13 14 15
23 24 25 26 27 23 24 25 26 27 20 21 22 23 24 18 19 20 21 22
30 31 27 28 29 30 25 26 27 28 29
Working Group
Role Enti Defined
Borrower Localities "LOC"
Local Bond Counsel Local Bond Counsel "LBC'7
Issuer Virginia Resources Authority "VRA"
VRA Bond Counsel McGuireWoods LLP BC"
VRA Financial Advisor Davenport& Company LLC "FA"
Financing Schedule
Date Activity Responsible Party
February 9'—February 20' ■ Refunding logistics conference calls ■ LOC/L,BC/VRA/BC
No Later than March 13' ■ Borrower provides finalized local ■ LOC
costs of issuance amount to be
included(if local costs of issuance
will be borrowed)
Week of March 16' ■ Distribute 1st preliminary local debt ■ VRA/FA
service schedules
No later than March 20" ■ All local approvals received, certified ■ LOC/LBC
resolutions/ordinances filed, and
execution of primary financing
documents including:
■ Delivery of adopted, certified
resolution/ordinance authorizing
financing to McGuire Woods
■ Execution and delivery of electronic
and original signed hard copy Local
Bond Sale and Financing Agreement
signature page to McGuire Woods (as
applicable for general obligation
bonds and revenue bonds)
No later than March 20" ■ Execution and delivery of electronic LOC/LBC
and original signed hard copy of
Local Lease Acquisition Agreement
and Financing Lease and Prime
Lease signature pages to
McGuire Woods (as applicable for
lease financings)
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Date Activity Responsible Party
Week of April 13t' ■ Distribute 2nd preliminary local debt ■ VRA/FA
service schedules
By April 20t' ■ Locality DRAFT documents due and ■ LBC
circulated to working group:
■ Closing Transcript
■ Closing Certificates
■ Bond Counsel Opinion
April 28t' ■ Tentative Bond Sale Date a VRA/FA
By May 5t'' ■ Signatures due in escrow to ■ BC/LBC/LOC
McGuireWoods on all Local
Borrower Documents, including
delivery of executed electronic and
original signed hard copy closing
documents to McGuireWoods
May 1lt'' ■ Tentative Pre-Closing ■ All
May 12t'' ■ Tentative Closing ■ All
* All dates are tentative and subject to change by Virginia Resources Authority
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