Presentation on theme: "Mello-Roos Community Facilities District 98-01 Rate and Method of Apportionment Proposed Amendment December 13, 2013."— Presentation transcript:
Mello-Roos Community Facilities District 98-01 Rate and Method of Apportionment Proposed Amendment December 13, 2013
Mello-Roos Community Facilities District formed in 1998 to fund $6.2M in improvements to Wastewater Treatment Plant. essentially a “prepaid” connection fee for specific areas of Kirkwood. At the time the bond was approved there were a few large parcels comprising of both ski and development acreage. Planned to redo boundaries once Specific Plan approved, never accomplished Vail condition of purchasing Kirkwood was to remove the encumbrance from “ski” land (where there is no plan for development or wastewater connection)
KMPUD Board agreed to work on this subject to: No other CFD members, besides KCP and Vail, being adversely impacted. That the District is financially secure with this change That KCP provide proper Indemnification to protect the District from future suits District not exposed to out of pocket costs All outstanding KCP receivables paid in full District consulting team: Dick Shanahan (general counsel), David Fama (bond counsel) and Victor Irzyk (bond administrator).
Methodology changed from an acreage based allocation to a residential dwelling unit allocation: Better alignment with rationale of CFD (prepaid tap fee) Acreage replaced with undeveloped parcels Improved collateral position for bondholders (assessment levy “matched” to parcel value) Ties into Specific Plan Developable units tied to parcels but can be moved “Backup tax” concept applies in the event of large default KCP / future development shoulders this risk, consistent with the prior structure
Cross-Collateralize all undeveloped KCP property Delinquency on any single property puts all property in default Cash Collateral Two years of incremental assessments on all undeveloped (relative to today): $472K. Collateral released upon CO Full Indemnification, based on security of cash collateral
How the Cash Collateral of $472K was Arrived at: Total Undeveloped Liability (KCP and Vail) = $283,370 Less Current KCP Liability = $47,010 Multiplied by Two (Based on the 18 month period it takes to foreclose on a delinquent property) Equals $472,720, Cash Collateral
Opportunity to modernize / update RMA to current best practice Alignment of assessment with original intent Within authority of existing CFD documents and specifically envisioned during zoning changes (2003) Fairness and Materiality Considerations No impact to existing owners in the CFD Reduced or mitigated risks to bondholders and the District Conservative credit enhancements