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VK CONSENT AGENDA Indian River County Inter -Office Memorandum Office of Management and Budget TO: Members of the Board of County Commissioners FROM: Kristin Daniels Director, Office of Management & Budget DATE: January 2, 2019 SUBJECT: Interest Rate Change on All County Financing (Petition Paving, Utility Assessment Projects, Utility Impact Fees, etc.) DESCRIPTIONS AND CONDITIONS In January of each year the Board of Commissioners adjusts the fixed interest rates charged by the County for financing utility assessments, utility impact fees, petition paving assessments and any other financing. County policy has been to set this rate equivalent to the prime interest rate as published in the Wall Street Journal and other financial news outlets, with the exception that the rate will not be set lower than 5.00% for County financing, as approved by the Board of County Commissioners on December 15, 2015. The 5.00% interest rate is equivalent to the maximum interest rate on County utility revenue bonds, and was established to prevent the County from lending at lower rates than our own borrowing costs The prime interest rate listed on Bloomberg on Thursday, December 27, 2018, was 5.50%. Staff recommends increasing the interest rate charged by the County from 5.00% to 5.50%. The only exception to this interest rate would be for projects directly affiliated with a bond issue for which the bond covenants dictate a different interest rate. RECOMMENDATION Staff recommends that the Board of County Commissioners approve the fixed interest rate of 5.50%. Staff further recommends that this rate remain in effect for calendar year 2019 for all County financing with the exception of projects directly affiliated with a bond issue for which the bond covenants dictate a different interest rate. ATTACHMENT County Financing Interest Rate History Meeting Date January 8, 2019 135