Explanation
Background
The purpose of this legislation is to authorize the substitution of a Letter of Credit (LOC) providing liquidity enhancement to the Series 1996-1 Various Purpose Adjustable Rate Unlimited Tax Bonds that the City issued in 1996. The current provider of the LOC is West LB AG, New York Branch (WestLB AG). WestLB AG, however, is in the process of exiting the business of providing LOCs for municipal debt. This ordinance will not only allow the City to continue providing the liquidity enhancement but will also make it possible to significantly reduce the costs of the LOC. It is estimated that over the next five years this ordinance will make it possible for the City to reduce the applicable fees of this LOC by $63,000.00, net of replacement costs.
This ordinance is made possible under Section 55(B) of the Columbus City Charter. The City Auditor requests, therefore, that the second reading of the ordinance be waived and that the ordinance be approved as submitted.
Fiscal Impact
Funding of this legislation will provide an estimated savings to the City of Columbus in the amount of $63,000.00, net of replacement costs.
Title
To authorize and direct the Director of Finance and Management and the City Auditor, and either of them individually, to enter into an agreement with JPMorgan Chase Bank, National Association, for the purpose of obtaining an Alternate Liquidity Facility for the City's Various Purpose Adjustable Rate Unlimited Tax Bonds, Series 1996-1 ($70,000.00)
Section 55(B) of the City Charter
Body
WHEREAS, pursuant to ordinances 2731-96, 2732-96, 2733-96, 2734-96, 2735-96, 2736-96 and 2737-96 (collectively, the "1996 Bond Ordinances") adopted by this Council on November 18, 1996, the City of Columbus, Ohio (the "Municipality") issued its Various Purpose Adjustable Rate Unlimited Tax Bonds, Series 1996-1 (the "Bonds") and obtained a Liquidity Facility (as defined in the 1996 Bond Ordinances) for the Bonds...
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