HomeMy WebLinkAboutSEOPW-CRA-2002-12-16-Discussion Item 07DATE: December 16, 2002
TO: Arthur E. Teele, Jr., Chairman
Johnny L. Winton, Vice -Chairman and
Members of the Board of Directors of the
FROM: Annette Lewis, Chief Financial Officer
SUBJECT: Draft Loan/Line of Credit Policy for discussion purposes
At the Board Meeting of November 25, 2002 tentative loan/line of credit policy was
requested by Vice -Chairman Winton. Attached please find a copy in draft form of the
pending loan policy for the CRA.
is
300 Biscayne Boulevard Way 0 Suite 430 • Miami, Florida 33131 • Phone (305) 579-3324 • Fax (305) 372-4646
� - DRAFT 1-tfR DISCUSSION ONLY
LOAN/LINE OF CREDIT POLICY OUTLINE:
Eligibility:
Loans from the CRA will be provided to private for -profit businesses located or
to -be -located within the boundaries of the SEOPW and OMNI Redevelopment agencies.
Loans will be on a first come first served basis based on its relationship with the mission
and objectives of the existing Redevelopment Plan within the respective CRA.
Loans are subject approval by Board of Directors of the CRA, for each CRA, after
a review and recommendation to be conducted by CRA staff. The total amounts of loans
awarded will be subject the annual budgeted amounts authorized within each
redevelopment area for a given fiscal year.
Loan/Line of Credit:
Upper Limit 25% of project amount not to exceed $55,000
Lower Limit $15,000
Equity requirements:
Leverage ration of 3:1 i.e. CRA will finance up to 25% of project costs up to
stated limits. Business and/or property owners, as appropriate, will be required to
contribute at least 75% of project costs in the form of cash, property and/or equipment.
Term:
Construction over 20 years for property that is owner by the borrower
1) Construction over the remaining life of existing lease for lessee with
specific approval for property owner for the performance of the
improvement(s) to the property. Additionally setting requesting from said
owners that the CRA place requirements that there will be no substantial
changes in the lease agreement resulting from the upgrade/betterment to
the detriment of the lessee.
Interest rate/Finance Charees:
Fixed Municipal Market Data for Rates "Low" rate with a cap of 4.0%
(Source MMD) -copy of the December 6t' 2002 data sheet is
attached. For instances where interest only is being paid for a
specific period, average interest rates will apply for that period
only, for subsequent periods the actual "Low" for that period will
apply for the remaining life of the loan.
Collateral:
Property and/or equipment whose fair market value is equivalent to or higher than the
value of the improvements will be required. Property and equipment should not
experience substantial depreciation over the life of the loan.
1D
Municipal Market *,,,,,,a - December 6, 2002
[ Municipals On -Line ]
On Thursday, initial claims provided a temporary jolt to bonds, falling to
355K. The weeks of down trending data is seasonal but it did raise concerns
about tomorrow forecasts on Nov employment data. At the open, treasuries gave
up the gains of the past several sessions. The tsy 10yr traded to 4.25% before
the market stabilized. But, it was concerns that Bush would not accept Iraq's
denial of owning weapons of mass destruction that raised the probability of war
and proved to be the demise of an early Dow rally. The Dow would close off
114pts (8623). Treasuries would rebound sharply before settling with gains of
2-4bps on the day. Munis reacted little to the initial dip in treasuries but
managed to show an average of 2-4bp gains as buying continues to improve and
munis remain relatively cheap to treasuries. Aggressive bidding on (MBIA)
$243min FBE's underscored that point, re -offered through the AAA curve in many
spots. Its January maturities provided additional incentive for buyer
participation in anticipation of the year-end roll. Currently, we are tracking
where the roll through 2010 would resemble from day to day on. Given
the steepness of the curve, early dated paper still remains a great value.
Municipal Yield Curves as of 12/05/2002
[
General Obligations
] [ "AAA"
Coupon
Range
"AAA"
PRE RE
INSURED
"AA"
"A"
"BAA"
"LOW"
"HIGH"
1
2003
1.28
1.28
1.31
1.31
1.53
1.85
2.50
3.55
2
2004
1.66
1.66
1.74
1.72
1.89
2.31
3.00
4.50
3
2005
2.01
2.01
2.10
2.08
2.35
2.81
3.50
5.00
4
2006
2.37
2.37
2.46
2.45
2.76
3.21
3.60
5.00
5
2007
2.73
2.73
2.84
2.83
3.14
3.68
3.75
5.00
6
2008
3.05
3.05
3.16
3.15
3.43
4.03
3.85
5.00
7
2009
3.29
3.29
3.42
3.39
3.71
4.29
4.05
5.00
8
2010
3.52
3.52
3.65
3.62
3.97
4.52
4.15
5.25
9
2011
3.71
3.84
3.81
4.16
4.72
4.25
5.25
10
2012
3.81
3.94
3.91
4.26
4.82
4.35
5.25
11
2013
3.94
4.06
4.04
4.39
4.94
4.50
5.40
12
2014
4.07
4.18
4.17
4.49
5.04
4.35
5.15
13
2015
4.19
4.30
4.29
4.59
5.14
4.20
4.80
14
2016
4.29
4.40
4.39
4.69
5.24
4.25
4.85
15
2017
4.39
4.49
4.49
4.78
5.33
4.35
4._80-511
16
2018
4.47
4.57
4.57
4.86
5.41
4.45
4.90
17
2019
4.55
4.65
4.65
4.94
5.48
4.50
4.90
18
2020
4.63
4.73
4.72
5.00
5.56
4.60
4.90
19
2021
4.71
4.81
4.80
5.04
5.63
4.70
4.90
0
2022
4.79
4.89
4.88
5.06
5.68
4.75
4.90
21
2023
4.83
4.93
4.92
5.08
5.71
4.75
4.90
22
2024
4.85
4.95
4.94
5.11
5.74
4.75
4.90
23
2025
4.87
4.97
4.96
5.13
5.75
4.75
4.90
24
2026
4.88
4.98
4.97
5.14
5.76
4.75
4.95
5
2027
4.89
4.99
4.98
5.15
5.77
4.75
4.9-511
26
2028
4.90
5.00
4.99
5.16
5.78
4.75
4.95
27
2029
4.91
5.01
5.00
5.17
5.79
4.75
4.95
28
2030
4.92
5.02
5.01
5.18
5.80
4.75
4.95
29
2031
4.93
5.02
5.01
5.18
5.80
4.75
4.95
30
2032
4.93
5.02
5.01
5.18
5.80
4.75
4.__0_511
[ Municipal Market Data -Line: Summary ]
12/05/02 12/04/02 12/03/02 12/02/02 11/29/02
Active $: Index(14916) [156.7061 [156.2181 (155.2961 [154.9091 [155.1031
30-day Vis Supply(14919) 7857 MIL 8192 MIL 8368 MIL 7578 MIL 4270 MIL
'AAA' Slope (1 vs 30 yr) 365 BP 365 BP 366 BP 368 BP 368 BP
'AAA' % Treas: 30-yr 99.1% 98.6% 98.6% 99.4% 99.4%
�mv��
✓P
( "AAA"
Muni
Yield Curve
Slope Analysis
]
BASIS
POINT
CURB
[09/05/2002
to
12/05/20021
[12/06/1999 to
12/05/2002]
Maturities
RATIO
SLOPE
AVG
STEEPEST FLATTEST
AVG
STEEPEST
FLATTEST
Syr -
lyr
4.60
145
116
145
95
96
210
01/04/02
10
12/26/00
10yr -
Syr
1.80
108
96
112
89
57
112
11/29/02
19
12/06/00
15yr -
10yr
1.31
58
64
71
56
50
71
11/12/02
31
05/01/00
20yr -
15yr
1.17
40
47
50
40
28
50
11/04/02
18
01/09/02
25yr -
20yr
1.12
10
11
15
6
8
15
09/25/02
4
11/29/01
30yr -
25yr
1.09
4
3
4
1
3
4
12/02/02
1
09/05/02
10yr -
lyr
8.30
253
212
254
185
154
280
01/04/02
31
12/19/00
20yr -
lyr
12.80
351
324
354
302
232
354
12/03/02
98
12/19/00
30yr -
lyr
15.60
365
338
368
317
243
368
12/02/02
109
12/19/00
[ Municipal Market
Data -Line
]
[ Revenue
Yield Curves
as of 12/05/2002 ]
"A" HOS
HOS Ins
"A" ELEC
ELEC Ins
"A" HSG
HSG Ins
1
2003
1.98
1.44
1.55
1.40
1.55
1.40
2
2004
2.52
1.86
1.95
1.82
2.00
1.80
3
2005
2.95
2.22
2.40
2.16
2.40
2.20
4
2006
3.38
2.59
2.84
2.56
2.75
2.55
5
2007
3.68
2.96
3.24
2.92
3.15
2.95
6
2008
3.98
3.32
3.52
3.24
3.48
3.28
7
2009
4.27
3.60
3.80
3.52
3.63
3.53
8
2010
4.52
3.84
4.06
3.76
4.05
3.75
9
2011
4.71
4.01
4.26
3.94
4.20
4.00
10
2012
4.81
4.11
4.36
4.04
4.30
4.10
11
2013
4.94
4.24
4.48
4.17
4.45
4.25
12
2014
5.06
4.35
4.59
4.26
4.58
4.38
13
2015
5.17
4.45
4.69
4.38
4.68
4.48
14
2016
5.27
4.55
4.79
4.48
4.78
4.58
15
2017
5.37
4.65
4.89
4.58
4.88
4.68
16
2018
5.46
4.75
4.97
4.67
4.96
4.77
17
2019
5.53
4.82
5.04
4.74
5.04
4.86
18
2020
5.61
4.90
5.11
4.82
5.13
4.94
19
2021
5.66
4.94
5.16
4.90
5.15
4.99
20
2022
5.68
4.96
5.20
4.95
5.17
5.02
21
2023
5.70
4.98
5.22
4.98
5.19
5.04
22
2024
5.72
5.00
5.24
5.00
5.21
5.06
23
2025
5.73
5.02
5.26
5.02
5.23
5.08
24
2026
5.74
5.03
5.27
5.03
5.24
5.09
25
2027
5.75
5.04
5.28
5.04
5.25
5.10
26
2028
5.76
5.05
5.29
5.05
5.26
5.11
27
2029
5.77
5.06
5.30
5.06
5.27
5.12
28
2030
5.78
5.07
5.31
5.07
5.28
5.13
29
2031
5.78
5.07
5.31
5.07
5.28
5.13
30
2032
5.78
5.07
5.31
5.07
5.28
5.13
BUD
ITEM 7
REPORT FROM EXECUTIVE DIRECTOR
ON
CRA LOAN TERMS