1. Department of Finance 1 Refunding Certificates of Participation, Series 2015A October 26, 2015 Finance Committee/City Council

2. Department of Finance 2 2015 Refunding COPs – Background In 2003, the City issued $73.79 million VRDB – City Hall and Public Improvement Project Entered into an interest rate swap with Ambac – Fixed the interest rate Bonds were insured by Ambac In 2008, the subprime mortgage crisis caused major interest rate dislocations City liquidated the swap and refunded the 2003 bonds with fixed rate COPs (2008C)

3. Department of Finance 3 2015 Refunding COPs – Background The 2008C COPs were issued in the principal amount of $71.45 million Current outstanding balance is $60.455 million City is currently paying an average interest rate of 4.82% Current market interest cost is 3.5% $55.335 million could be advanced refunded

4. Department of Finance 4 Refunding Plan Refund $55.335 million of the outstanding 2008C series Issued at fixed interest rates Same terms as current outstanding bonds – No extension of maturities Pure refinancing – no new money Estimated savings = $4.46 million Estimated NPV savings = 5.69%

5. Department of Finance 5 Refunding Plan Annual Savings Estimated average annual debt service savings under current interest rates is $194,000 (10/7/15) $128,000 from 2016 – 2018 $207,000 from 2019 – 2038

6. Department of Finance 6 Interest Rate Risk/Sensitivity Total NPV Savings Savings % NPV Annual Ave in Millions in Millions Savings D/S savings Current Rates $4.46 $3.15 5.69% $194,000 Rates increase $2.92 $2.02 3.65% $127,000 By 0.20% Rates decrease $5.78 $4.15 7.51% $251,000 By 0.20%

7. Department of Finance Schedule October 28, 2015 – Obtain ratings from Fitch and S&P October 28, 2015 – Print and distribute the Preliminary Official Statement (POS) By November 5, 2015 – Expected pricing November 19, 2015 – Close the financing 7

8. Department of Finance Recommendation Authorize the resolution approving the execution and delivery of not-to-exceed $60 million aggregate initial principal amount of Refunding Certificates of Participation, Series 2015A 8