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Davis County approves bond parameters to fund South Davis County Library project
Summary
The Davis County Commission approved a parameters resolution allowing up to $6.2 million in bonds for the South Davis County Library, set limits on terms and interest rates, and directed a public hearing before final sale.
The Davis County Commission on May 27 approved a parameters resolution that allows the county to issue bonds of up to $6,200,000 to finance the South Davis County Library project.
The resolution sets a maximum term of 21 years, caps fixed interest rates at 6% and variable-rate structures at 15%, and authorizes a direct-purchase sale process. Curtis Koch, Davis County controller, and Jonathan Ward of SCI Public Finance briefed the commission on the financing method and next steps.
Koch said the parameters give the county “a set of parameters, to operate within as we, move forward to look to issue bonds, for the South Davis County Library project,” and noted the county has been saving for the project since 2017. Jonathan Ward described the planned sale as a direct purchase to investors: “we would sell these directly to investors who wanna buy them. We will offer it to no more than 35 specific investors as per SEC regulations,” he said, adding that direct purchases can include more flexible prepayment features.
Ward told commissioners that direct purchase pricing typically runs a bit higher than a public sale in current market conditions — “probably about a half a point difference” — and that bids are expected back in roughly two weeks. He also recommended a public hearing be scheduled no sooner than June 17 to meet the minimum 14-day notice required by the bond process. “My my recommendation is just wait. Let's just make sure we get a full 14 days notice in there,” Ward said.
Controller Koch said a capital reserve fund established in 2017 has accumulated about $4,000,000 toward the project and that the county does not anticipate needing an additional tax increase to cover the debt service. The commission approved the resolution by voice vote after a motion from Commissioner Bob Stevenson and a second by Commissioner Lorraine Kamalu.
Next steps described by staff include soliciting direct-purchase bids within the approved parameters, receiving and evaluating bids, holding the required public hearing, and then returning to the commission to award and close the bond sale.
