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OCII authorizes BLX Group contract for arbitrage rebate consulting, not to exceed $116,390
Summary
OCII approved a personal services contract with BLX Group LLC to provide bond arbitrage rebate consulting services (not to exceed $116,390) and set a contract term through 12/31/2021; staff said the work ensures compliance with IRS arbitrage rebate rules.
The Commission on Community Investment and Infrastructure unanimously authorized a personal services contract with BLX Group LLC on April 2 to provide bond arbitrage rebate consulting services for OCII, with a not‑to‑exceed budget of $116,390 and a contract term to 12/31/2021.
John Daigle, OCII senior financial analyst and debt manager, described arbitrage rebate as an IRS requirement that compares the interest rate paid on tax‑exempt bonds to the investment return on bond proceeds. "Bond arbitrage earnings occur when funds are invested at a higher interest rate than that at which they're borrowed," Daigle explained, and said calculations and legal/regulatory analysis will be required periodically and at certain bond maturities. The contract scope includes document review, data‑collection support from staff and computational rebate analyses.
Daigle said BLX was selected via a competitive panel established by the Office of Public Finance and was chosen for prior performance and regulatory expertise; staff noted the contractor could consult with bond and tax counsel as needed. The commission moved and approved the contract on a 5–0 vote. Staff said BLX will assist OCII with required rebate calculations and reporting to ensure compliance with IRS rules.
