11/27/1985 - Laserfiche WebLink

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Commissioner Scurlock did not anticipate these numbers to change much over 7 years, except for the rounds of.play and the fee charges; however, this structure gives us the ability to raise the cost of green fees, etc. He felt we will have to monitor the play fee closely to make sure that we are not driving away players. Mr. Diamond explained the following assumptions that he used independent of Commissioner Scurlock's figures to come up with a financing structure that is realistic in view of today's market environment: 1) $2.1 million would have to be borrowed for construction. 2) Net revenues after six years of borrowing the money would approximate $333,288. 3) The method of borrowing would be a private placement at an anticipated fixed rate of 7 3/4% for a 5 -year BAN with financing after 5 years at 110 on a 25 -year bond issue. Mr. Diamond also assumed that the County will borrow sufficient money over 30 years to pay interest, because this is a start-up operation. Mr. Diamond recommended private placement because of the following advantages 1) If we run into difficulties along the line, we would be able to sit down and negotiate with one entity. 2) We would have the ability to amend the underlying document/ resolution. 3) There is no need, unless the institution requires it, for the County to rate the notes in any way since the County is considered a sophisticated investor. 4) Issuing costs are somewhat less. 5) Some structure can be cut during initial negotiation with the lending institution. Commissioner Bird understood that the BANS will give us the option of interim financing for the project and we can at some 41 NOV 7 1985 BOOK ID2 fAc-L 8