Title
Ordinance in the Amount of $1,392,000 Amending FY 14-15 Community Development Fund and in the Amount of $2,186,000 Amending FY 14-15 S. Elm Street Redevelopment Fund for HUD Section 108 Certificates, Series 2015
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Department: Financial and Administrative Services
Meeting Date: June 16, 2015
Council District: N/A
Public Hearing: N/A
Advertising Date/By: N/A
Contact 1 and Phone: Richard Lusk, Finance Director, 373-2077
Contact 2 and Phone: Marlene Druga, Deputy Finance Director, 373-2077
PURPOSE: To appropriate funds to account for the refinancing of two HUD Section 108 notes outstanding (Series 2002A-$1,015,000 and Series 2003A -$377,000), (Willow Oaks) and to convert an interim variable rate HUD Section 108 note outstanding to permanent financing, ($2,186,000), (S. Elm Street Redevelopment). The transactions were included in a HUD public offering of trust certificates guaranteed under Section 108 of the Housing and Community Development Act of 1974, as amended. The City's notes were accumulated in a trust created by HUD (together with other Section 108 Notes issued by other borrowers) and Series 2015A certificates were issued by HUD on May 28,2015, resulting in reduced debt service payments for the City approximating $159,000 in relation to the refinancing of the Series 2002A and 2003A notes.
BACKGROUND: Beginning in 2002, the City began borrowing up to $7,461,000 in authorized HUD Section 108 notes to fund a portion of the Willow Oaks project in southeast Greensboro as construction progressed, in partnership with the Greensboro Housing Authority. Certain of the notes (2002A and 2003A) were eligible for refinancing in 2015. Due to the current favorable interest rate environment, the City chose to participate in the 2015 HUD refinancing transaction, resulting in estimated savings of $159,000. In addition, beginning in FY 2006, a variable rate interim Section 108 note was issued to fund the City's $3 million commitment to the S....
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