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CONSENT AGENDA <br />Indian River County <br />Inter -Office Memorandum <br />Office of Management and Budget <br />TO: Members of the Board <br />of County Commissioners <br />FROM: Kristin Daniels <br />Director, Office of Management & Budget <br />DATE: December 27, 2019 <br />SUBJECT: Interest Rate Change on All County Financing <br />(Petition Paving, Utility Assessment Projects, <br />Utility Impact Fees, etc.) <br />DESCRIPTIONS AND CONDITIONS <br />In January of each year the Board of Commissioners adjusts the fixed interest rates charged by the <br />County for financing utility assessments, utility impact fees, petition paving assessments and any other <br />financing. County policy has been to set this rate equivalent to the prime interest rate as published in the <br />Wall Street Journal and other financial news outlets, with the exception that the rate will not be set lower <br />than 5.00% for County financing, as approved by the Board of County Commissioners on December 15, <br />2015. The 5.00% interest rate was equivalent to the maximum interest rate on County utility revenue <br />bonds, and was established to prevent the County from lending at lower rates than our own borrowing <br />costs. <br />On July 9, 2019 the Board approved early payoff of the Series 2009 Water & Sewer Revenue Bonds. <br />The remaining Series 2015 Water & Sewer Revenue Bonds carry a true interest rate of 1.80%, thus staff <br />recommends waiving the minimum interest rate previously set at 5.00%. <br />The prime interest rate listed on Bloomberg on Monday, December 27, 2019, was 4.75%. Staff <br />recommends decreasing the current interest rate of 5.50% charged by the County, down to 4.75%. The <br />only exception to this interest rate would be for projects directly affiliated with a bond issue for which the <br />bond covenants dictate a different interest rate. <br />RECOMMENDATION <br />Staff recommends that the Board of County Commissioners approve the fixed interest rate of 4.75%. <br />Staff further recommends that this rate remain in effect for calendar year 2020 for all County financing <br />with the exception of projects directly affiliated with a bond issue for which the bond covenants dictate a <br />different interest rate. <br />ATTACHMENT <br />County Financing Interest Rate History <br />Meeting Date January 7, 2020 <br />77 <br />