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Staff: bonds and iBank loans offer different timetables; county co-borrower could lower costs
Summary
Staff compared bond funding, iBank loans and grant-bond combinations, noting bonds can be faster with grants while iBank loans take longer; staff said county co-borrowing or guarantor arrangements could improve interest rates.
Staff summarized financing alternatives for the project: bonds coupled with grants, iBank loans and other state revolving funds. "If we go with a bond coupled with grants or grants coupled with bonds, it's actually a shorter process. If we go with the iBank, they actually require a little longer time length," the presenter said, explaining trade-offs between speed and underwriting requirements.
The presenter said loan pricing will reflect the district's lack of credit rating and collateral but suggested the county acting as co-borrower or guarantor could secure better rates: "if since you don't have any collateral... the county said you're gonna do it, yeah, property tax anyway, which is being the borrower... you're gonna get a much better rate by doing that." Board members also discussed that equipment located on private property is generally ineligible for loan funding unless the district owns and maintains it; staff said, "unless you're gonna own it and maintain it, we're not gonna give you money for it."
The committee asked staff to explore co-borrower structures and to request formal rate/term examples from bond counsel and iBank representatives to compare net costs and timeline impacts before the next board meeting.
Provenance: topicintro SEG 401; topfinish SEG 656
