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7. F. <br />DATE: July 17, 2001 <br />SUBJECT: Interest Rate Change on All County Financing <br />(Petition Paving, Utility Assessment Projects, Utility Impact Fee, etc.) <br />Description and Conditions <br />Fixed interest rates charged by the County for financing utility assessments, utility impact fees, petition <br />paving assessments and any other financing are adjusted on an annual basis in January of each year. <br />On January 2, 2001, the Board of Commissioners approved an interest rate of 8.5% for calendar year <br />2001. Since interest rates were dropping substantially during this time period, the Board requested that <br />staff revisit this issue after six (6) months. <br />During the current calendar year, the Federal Reserve has continued to lower key interest rates. This <br />has resulted in a change in the prime rate from 9.5% on December 20, 2000 to 6.75% on July 16, 20011 <br />as published in the Wall Street Journal. Past policy has been to set the County rate equal to the current <br />prime rate. In accordance with this policy, staff recommends adjusting the interest rate charged by the <br />County to 6.75%. This represents a 1.75% decrease from the current rate. The only exception to this <br />interest rate would be if the project was directly affiliated with a bond issue and the requirements dictated <br />a different interest rate. <br />Staff Recommendation <br />Staff recommends that the Board of Commissioners approve the proposed fixed interest rate of 6.75% <br />(or 6 3/4%) for the remainder of calendar year 2001. The only exception to this interest rate would be <br />if the project was directly affiliated with a bond issue and the requirements dictated a different interest <br />rate. <br />ON MOTION by Vice Chairman Stanbridge, SECONDED BY <br />Commissioner Tippin, the Board unanimously approved the <br />proposed fixed interest rate of 6.75% (or 6 3/4%) for the <br />remainder of calendar year 2001, as recommended in the <br />memorandum. The only exception to this interest rate would be <br />if the project was directly affiliated with a bond issue and the <br />requirements dictated a different interest rate. <br />wes R <br />The Board reviewed a memorandum of July 18, 2001: <br />July 24, 2001 <br />16 <br />�'r 10 <br />n <br />