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OCII approves three financial-advisory contracts to support Transbay and housing bond sales
Summary
The Commission on Community Investment and Infrastructure approved three personal services contracts on Oct. 4 to secure financial advisory services for upcoming Transbay infrastructure and housing bond financings and a housing refunding, citing a target of roughly 3% net-present-value savings on refundings and an expected spring 2017 financing timetable.
The Commission on Community Investment and Infrastructure on Oct. 4 authorized three personal services contracts to support upcoming bond financings for Transbay infrastructure and new housing projects and a housing refunding.
Staff said the contracts are technical steps required to prepare and execute planned bond sales. John Daigle, OCII senior financial analyst, told commissioners the package includes a $37,000,000 Transbay infrastructure bond, roughly $113,000,000 in new-money housing bonds and a refunding of outstanding housing bonds. "Our general target is 3% net present value savings," Daigle said when describing the refunding objective.
An evaluation panel recommended Public Financial Management (PFM) as lead advisor for Transbay and housing new-money issuances, Kitahata and Company as a co-financial advisor focused on process administration and scheduling, and CSG Advisors as financial advisor for the housing refunding. Staff said the contracts would remain in effect until the financings are complete, currently expected in spring 2017.
Contract not-to-exceed amounts presented to the commission were $226,000 for the PFM engagement (which staff said breaks down into fees for Transbay and new-money housing tasks, expenses not to exceed a few thousand dollars per issue and an executive-director contingency allowance), $79,960 for Kitahata and Company, and $41,350 for CSG Advisors. Staff said contingency allowances were included to allow flexibility for unexpected technical needs during complex, multi-project financings.
Commissioners asked about housing set-asides and the pipeline of units targeted for homeless households; staff described existing practices (typically 20–30% set-asides on multifamily developments), cited Mission Bay and other project set-asides, and said OCII and city service partners coordinate referrals and supportive services. After discussion, a motion to approve the three personal services contracts passed on a roll call vote of three ayes and two absent.
What happens next: OCII staff will execute the contracts and proceed with procurement and financing steps; bond issuances will be scheduled and underwritten with the selected advisors, and staff expect to return with financing plans and timetable details before the anticipated spring 2017 closings.
