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Indianapolis bond board approves refunding of 2010 Build America bonds
Summary
At its Aug. 25 meeting the Board of Indianapolis Local Public Improvement Bond approved two resolutions authorizing issuance of 2025 bonds to refund 2010 Build America bonds, allowing the Health and Hospital Corporation to replace a cash debt-service reserve with a surety and access held funds.
The Board of Indianapolis Local Public Improvement Bond voted Aug. 25 to approve two resolutions authorizing the issuance of 2025 bonds to refund Build America bonds issued in 2010 for Eskenazi Hospital.
Bond counsel Joe said the two refundings are intended to provide more certainty for debt service after federal subsidy reductions related to sequestration. He told the board the 2010 bonds were issued under the American Recovery and Reinvestment Act of 2009 as taxable “Build America” bonds with a federal interest subsidy. Joe said reductions in that federal subsidy have increased annual debt service costs and that the refundings will allow the Health and Hospital Corporation to replace a cash-funded debt-service reserve with a surety and to access the roughly “30 plus million dollars in that reserve.”
The board approved Resolution No. 2, authorizing issuance of 2025 C bonds to refund the 2010 A-2 Build America bonds in an aggregate principal amount not to exceed $150,000,000 with a maximum interest rate of 6.5 percent. Member Case moved to pass Resolution No. 2; a second was recorded on the record; the motion passed.
The board also approved Resolution No. 3, authorizing issuance of 2025 D bonds to refund the 2010 B-2 Build America bonds in an aggregate principal amount not to exceed $345,000,000 with a maximum interest rate of 6.5 percent. A member moved and another seconded Resolution No. 3; the motion passed.
Joe said the two refundings had already received approvals from the City-County Council, the Health and Hospital Corporation board and the Indianapolis-Marion County Building Authority board, and that the bond board’s votes were the final local approvals required at this meeting.
Separately, staff member Mr. Glass updated the board on anticipated general-obligation bond authorizations the city-county council has introduced. He said council resolutions would finance a new tornado-warning system, a replacement Indianapolis Fire Department station and street-improvement equipment in an amount not to exceed $21,000,000; he said the bond bank board would likely see a request for approval in October. Glass also said the board would likely be asked in September or October to consider bonds related to reconstruction of Old City Hall as part of the TWG development at that site.
The board adjourned following the updates.
Votes at a glance: Resolution No. 2 (2025 C bonds to refund 2010 A-2 Build America bonds): approved. Resolution No. 3 (2025 D bonds to refund 2010 B-2 Build America bonds): approved. The transcript records recorded “aye” votes and the chair’s announcement that motions passed; specific vote tallies by name were not specified in the meeting record.
