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Home My WebLink AboutR-87-0152ok J-87-150(b) 2/12/87 RESOLUTION NO. 13 7"1#rZ' "' A RESOLUTION SELECTING AND APPOINTING DREXEL DURHAM LAMBERT AS UNDERWRITERS TO THE CITY OF MIAMI FOR THE CITY OF MIAMI CONVENTION CENTER - PARKING GARAGE REFUNDING BONDS, REFUNDING ALL OR A PORTION OF THE CURRENTLY OUTSTANDING $60,000,000 CITY OF MIAMI CONVENTION CENTER - PARKING GARAGE REVENUE BONDS AND AUTHORIZING THE CITY MANAGER TO NEGOTIATE A CONTRACT FOR SAID UNDERWRITING SERVICES. WHEREAS, the City of Miami, Florida, has outstanding on the date hereof, its $60,000,000 Convention Center and Parking Garage Revenue Bonds, dated July 1, 1980, (the 1980 Bonds); and WHEREAS, it is in the best financial interest of the City to refund all or a portion of the 1980 Bonds by issuing new bonds at a lower interest rate; and WHEREAS, the economic savings to the City from this proposed refinancing are projected to be in the range of $3.0 to $3.5 million in present value savings; and WHEREAS, the City's financial advisors, James J. Lowrey & Co., prepared and distributed a RFP for underwriting services; and WHEREAS, a selection committee appointed by the City Manager reviewed all the proposals and ranked the top three proposals; and WHEREAS, it is to the City's financial benefit to take advantage of the currently favorable interest rates available in the tax exempt capital market; NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. This Resolution is adopted pursuant to the Charter of the City, and Chapter 166, Section 218.385, of the Florida Statutes, and other applicable provisions of the law. 'y- COMMISSION MEETING OF FEB 12 1987 IN No, 15I -15 Section 2. It is hereby ascertained, determined and declared that it is in the best financial interest of the City to accept the proposal of Drexel Burnham Lambert to serve as underwriters to the City of Miami for the issuance of bonds to advance refund the outstanding 1980 bonds. Section 3. The City Manager is hereby authorized to negotiate a contract with the above underwriters for underwriting services to be provided for this transaction with the further provision that said underwriters shall themselves negotiate with Daniels and Bell and the firm of M. Securities, Inc. for acceptable management participation by the latter two firms which would take into consideration all of the y= bono work in regard to this matter which has heretofore been performed by said firms. PASSED AND ADOPTED this 12th day of February 1987. Z�Z� �' 67 - XAVIER L. S EZ, MAYOR AT S MA TY HIRAI CITY CLERK PREPARED AND APPROVED BY: ROBERT F. CLARK CHIEF DEPUTY CITY ATTORNEY TO FORM AND CORRECTNESS: LIEDMA A. DOUGHERTY CITY ATTORNEY RFC:bss:M353 -2- $7'-.15.2 so CITY OF MIAMI, FLORIDA INTER -OFFICE MEMORANDUM To Honorable Mayor and Members DATE January 29, 1987 FILE: of the City Commission SUSUECT Underwriter Selection for the Convention Center - Garage Refinancing FROM REFERENCES. Cesar H. Odio For City Commission City Manager ENCLOSURES. Meeting of 2-12-87 RECOMMENDATION: It is respectfully recommended that the attached Resolution selecting and . appointing underwriters for the City of Miami Convention Center - Parking Garage Refunding Bonds, refunding all or a portion of the City's outstanding $60,000,000 Convention Center and Parking Garage Revenue Bonds, and authorizing the City Manager to negotiate a contract for said underwriting services, be approved. BACKGROUND: At the City Commission meeting of December 11, -1986, the Commission instructed the City Manager to initiate a Request for Proposal (RFP) process, for the possible refinancing of outstanding City of Miami Convention Center - Parking Garage Bonds. The Finance Department, in con junction with the City's financial advisory firm, James J. Lowrey & Co., prepared and distributed a RFP for th•e underwriting services for this bond refinancing. A Selection Committee was appointed by the City Manager, as follows: Diane Cook - Treasurer, University of Miami Carlos E. Garcia - Director of Finance Ray E. Good, Chairman, Finance & Audit Committee, University of Miami Tony Pa j ares - Executive Director, Conference & Conventions Department Waiter Pierce - Assistant City Manager 8 7~1.5Z. f; r. Honorable Mayor and Members of the City Commission Page - 2 - The review committee met on January 21, 1987 and reviewed the proposals submitted, based upon the following criteria: 1. Proposed structure of the financing and projected fees and expenses. 2. Experience in the issuance of advance refunding bonds in Florida within the past two years. 3. Structure of the Firm and Capital base. 4. Indivi.duals who will be assigned to this transaction. 5. Minority participation and compliance with the City's Minority Procurement Ordinance. 6. Additional relevant qualifications and experience. Attachment A, summarizes the seventeen proposals received from various underwriting firms, or teams of firms. The Review Committee selected three firms/teams, in the following ranking of preference: Shearson Lehman Brothers, Grigsby Bran dford (B1 ack firm) , AIBC Investments (Hispanic firm). Drexel Burnham Lambert Merrill Lynch - Both Drexel Burnham Lambert, and Merrill Lynch, indicated in their proposals that they will comply with the City's Minority requirement if selected as Managing Underwriters. Approval of this transaction will appoint the Managing Underwriters and will authorize the City Manager to negotiate a contract for underwriting services. The purpose of this advance refunding transaction is to allow the City to take advantage of the low interest rates available in the tax-exempt capital market at present. It is estimated by the City's financial advisor, James J. Lowrey & Company, that this refinancing would save the City approximately $3:0 - $3.5 million in present value dollars. cc: City Attorney Z 87-15a1 i 87-153► Follows is a short summary of the respon a, answers to Questio, �o. 1 in the Request For Underwrites Proposal. The question read as follows: Provide any ideas that you say have on the specific structure of the financing and the sale of bonds for the City's requiresients. The respondents are listed in alphabetical order. Bear Stearns o submitted standard refunding analysis Dean Witter/Metro Equities o discussed various refunding strategies including the use of TEDBs, CABS and variable rate Dillon Read o discussed various refunding strategies including use of surety bond and subordinate obligations Drexel Burnham Lambert o discussed the use of a debt service reserve surety bond First Boston o discussed the use of CABS and insurance First Equity o did not answer question Goldman Sachs/Daniels i Bell/M Securities o discussed the use of CABS and a surety bond William R. Hough/WR Lazard/United Daniels/Southwestern Capital o discussed options for the debt service reserve fund EF Hutton o discussed various refunding strategies using insurance and issuing warrants Lazard Freres o submitted standard refunding analysis Merrill Lynch o discussed various refunding strategies including the use of insurance, variable rate debt and automatic calla Morgan Stanley o. discussed various refunding strategies including the use of GICs, cross-overs, ARROS and insurance PaineWebber o submitted standard refunding analysis Prudential Bache o discussed structuring of issue and the use of OIDs and a crossover refunding LF Rothchild/Pyror, Govan o submitted standard refunding analysis Salomon Brothers o discussed various refunding strategies including use of surety bond and subordinate obligations Shearson Lehman/Grigsby Brandford/AIBC o discussed the use of CABS S'7-154-1 8 7-153 3 ASSUMED TOTAL EXPERIENCE SIZE OF INTEREST RATE/ ESTIMATED ESTIMATED IN FLORIDA CAPITAL PROPOSED ESTIMATED PRES. MANAGEMENT FEE TAKEDOWN ADVANCE STRUCTURE PROPOSER ISSUE VALUE SAVINGS ($ MILLIONS) EXPENSES/BASED ON SIZE OF ISSUE AND RISK/BASED ON SIZE OF ISSUE REFUNDINrS # (.In. Billions) OF THE FIRM ($ Billions) PERSONNEL ASSIGNED MINORITY PARTICIPATION Bear Stearns $51,585,000 NIC 7.06% $128,962 $438,473 19 $1.7 $.920 Hayden Will Comply TIC 7.275% Institutional Melvin $3.45 and Retail Alvarez Arone Dean Witter/ Metro Equities Not Provided TIC 6.938% $150,000 Not Provided 32 $1.4 $1.3 Dunlap Metro Equi- $3.3 - $4.2 (Based on Institutional Jordan ties (Black $60,000,000) and Retail Moorhead Firm) Seaton, Etc. Dillon Read $51,710,000 NIC 6.95% $193,913 - $478,317 - 4 $ .6 $.110 Faupl Will Comply $251,343 $619,918 Institutional Traudt Imhoff Schmitt,Etc. Drexel Burnham $65,905,000 NIC 6.96% $15,715 $572,055 12 $1.1 $1.8 Burnett Will Comply Lambert $4.6 Institutional Middlemas and Retail Maisio Christenson Ang � First Boston $61,523,690 TIC 6:76% Total Grdss 8 $1.42 $1.2 Spread Hall Will Comply $5.649 $922,229 Institutional LaMaita Penney Urheim First Equity Not Provided Not Provided Not Provided Not Provided 3 $.i41 $.002 Will Comply �j Retail Parera Schubert . Fernandez ASSUMED INTEREST RATE/ TOTAL ESTIMATED ESTIMATED SIZE OF ESTIMATED PRES. MANAGEMENT FEE TAKEDOWN PROPOSED VALUE SAVINGS ($ MILLIONS) EXPENSES/BASED ON SIZE OF ISSUE AND RISK/BASED ON SIZE OF ISSUE PROPOSER ISSUE Goldman Sachs $59,775,000 - Not Provided $179,325 $537,975 - Daniels & Bell $66,110,000 $314,022 $677,627 M Securities $3.4 - $3.5 EXPERIENCE IN FLORIDA CAPITAL ADVANCE STRUCTURE REFUNDINGS OF THE FIRM PERSONNEL MINORITY N (In Billions) ($ Billions) ASSIGNED PARTICIPATION 26 $2.6 Spector, Schott Daniels & Bell $1.2 Fagan, Montes (Black Firm) Institutional Gomez, Gary M Securities Scott, Ourlict (Hispanic Firm) W.R. Hough Not Provided 33 $3.06 W. R. Lazard Not Provided Not Provided $130,000 United Daniels (Based on Southwestern $6.0 $60,000,000) Capital Mkts. • 30 $3.6 E. F. Hutton $60,000,000 NIC 6.754% $117,000 $495,000 $6.178 Lazard Freres . TIC 6.948 . $67,258,840 $235,403 - $470,906 - 5 $.74 $437,177 $554,878 $5.16 --- 768 Gross Spread 40 --- 53.25 Merrill.Lynch $12,768,229 �IIC 7.17a Co- IC$Fee Not Broken Down $3.78 - $4.7 $873,216 $.007 Bennett Daniels Lazard & Daniels Institutional McDonald Moss (Black Firm) Lazard Keller Southwestern Rodriguez Capital Mkts. Dimas (Hispanic Firm) $1.1 Cahalan Institutional Schuit and Retail Connaughten Aeekin $.70 Tamaain Institutional $2.4 Frasca Institutional Jahnes and Retail Wendt Press 3 $.063 — $1.5 Mabon Bellamy Morgan Stanley $65,610,000 - 7.107% $64,025 $492,075 Institutional Musca $66,600,000 $66,500 $666;000 ------------------_-- Yee — $3.7 - $10.9 1 CA IvJ N • Will Comply Will Comply Will C00101V 44 Will Comply ASSUMED TOTAL EXPERIENCE INTEREST RATE/ ESTIMATED ESTIMATED IN FLORIDA CAPITAL SIZE OF ESTIMATED PRES. MANAGEMENT FEE TAKEDOWN ADVANCE STRUCTURE PROPOSED VALUE SAVINGS EXPENSES/BASED AND RISK/BASED REFUNDINGS OF THE FIRM PERSONNEL PROPOSER ISSUE ($ MILLIONS) ON SIZE OF ISSUE ON SIZE OF ISSUE # (In Billions) ($ Billions) ASSIGNED Paine Webber $55,505,000 7.074% 17 $1.4 $1.03 Pellegrini $138,762 Institutional Denton Rein $5.48 $416,287 & Retail Olson Paret Prud::ptiai Gache $64,370,000- Not Provided $543,926 - 37 $2.6 $4.21 Pairer$g0,118 Mace ' $66,335,000 $5.36 - $5.37 $92,869 $560,530 Institutional Soviero and Retail Bryant Salomon Brothers NIC 7.182 20 $2.7 $3.1 Spraggins $50,665,000 - TIC 7.25% $179,354 $426,092 Institutional Strauss $51,650,000 $182,841 Amundson $2.58 - $3.74 O'Brien Mashoff L. F. Rothschild $67,725,000 TIC 6.98% 3 $.254 $.350 Berenyi Prior, Govan $118,518 $778,837 Institutional Singer $3.826 Vereen Counts Pryor, etc. Shearson Lehman NIC 7.006% $113,000 1 $577,080 - 11 $2.34 $2.74 Greenfield IF Grigsby Brnadford $63,000,000 $653,940 Institutional Montalbano i"& AIBC $3.5 - $3.8 and Retail Cordell Borys 1Subsequent to the receipt of the proposal, the proposer provided information indicating that the Management fee would apply only -to the Co -Manager at a rate of $1.00 per bond. CA N MINORITY PARTICIPATION Will Comply Will Comply Will Comply Pryor, Govan (Black Firm) Grigsby Branford (Black Firm) AIBC (Hispanic Firm) SELECTION OF UNDERWRITERS "� if''1S CITY OF MIAMI 0./ `' f � CO MENTION CENTER b PARKING GARAGE 0-0"�'C1Le� "` �i '-'' REFUNDING BONIS FIRM NAME F'rs /` �o tP11 JA - y QUESTION S Yes or No TOTAL POINTS L Dean Witter ,D411--a Reed Drexel Burnham 04 First -Boston rtY� 3►3�1 3-;3 Goldman Sachs �*.A. Hough 1 E.F. Hutton 8 eres Ila Merrill Lynch R gan Stanley Paine Webber Prudential Bach i 4 �1 u L : F : Rb-T i3T?M d Salomoa- Bras, �SJ y.0 Shearson Lehman 87-153 87-152, SELECTION OF UNDERWRITEi:. CITY OF MIAMI CONVENTION CENTER 6 PARKING GARAGE REFUNDING BONDS i FIRM NAME QUESTION QUESTION QUESTION QUESTION 1 2 3 4 QUESTION POTAL OINTS cs� /*60% 110(11) 10% 10% iul Yes or no Bear Sterns ,�^ 7 7 4r G Dean Witter Dillon Reed @Drexel 'Ys 7 9 is + Burnham First Boston i First Equity ),' 3 � i � -s" Goldman Sachs W.R. Hough .30 E.F. Hutton �� % ho 7 '� Lazard Freres Merrill Lynch �s g Morgan Stanley Paine Webber 30 7 7 " Prudential Bachi 3 / 7 L.F. Rothschild 3C `f'44 Salomon Bros. 7$ (�hearson Lehman S'7-153► 8'7-1S2► SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONDS FIRM NAME Q STION QUESTION QUESTION QUESTION QUESTION TOTAL 10 2 3 4 POINTS n, KhIL An i n% 10t 10% Yes or No — Bear Sterns I —,•-- S .� 9. F Dean Witter 3 46 y I Dillon Reed Drexel Burnham ,3� 6 5 63 (I) First Boston First Equity Goldman Sachs 5 N.R. Hough O E.F. Hutton S 7 Z 7 Lazard Freres S d Merrill Lynch 3jr 5 ` ( S 3 5r Morgan Stanley Paine Webber �' 6- Pruden � 1 Bachi 110 7� L.F. Rothschild 7 0 6 Salomon Bros. Shearson Lehman 3s S .S ✓ I a �S 137ri53 61:;C -✓" G► SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONDS FIRM NAME QUESTIONQUESTION QUESTION QUESTION - I I! (4 2 3 4 3OAr FA 100 I QV 100 QUESTION TOTAL 5 /o POINTS Bear Sterns 3 y Dean Witter 3 Z Dillon Reed Drexel Burnham (� C> First Boston L/ 3 �„ First Equity Goldman Sachs 3 S N.R. Hough L/ d E.F. Hutton L� 7 % Z, Freres SLazard Merrill Lynch Morgan Stanley t� .3 1; <70 3 Paine Webber Prudential Bach L.F. Rothschild 3, 7 1 z V G Salomon Bros. `/�� l J Shearson Lehman w SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONDS FIRM NAME QUUEESTIDI QUESTION QUESTION QUESTION f erbf&p# QUESTION TOTAL 511c1.) POINTS Bear Sterns lcggS _b icy 10% 10% 10% �' �e Yes or No )�o 5 Dean Witter .0 101 q a , Dillon Reed 7D 3 V ,� 3 Drexel Burnham Iv y g First Boston S First Equity }-� Goldman Sachs �� /� l M.R. Hough /(� %•� �� , E.F. Hutton Lazard Freres OMerrill Lynch Morgan Stanley Paine Webber ?Prudential Bach C% L.F. Rothschild p 7 Salomon Bros. .. " Shearson Lehman - dw � 1 SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GAk.AGE REFUNOING BONDS FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL 14 is 2 3 4 A 5 fi POINTS Bear Sterns 2s F//� Dean Witter 3' 3 S r (r7 Dillon Reed Drexel Burnham 3� �0 g g J G8 First Boston First Equity 123 Goldman Sachs N' '` 4d 80 W.R. Hough 3` Q 10 76 C E.F. Hutton 73 Lazard Freres I Merrill Lynch Morgan Stanley � Paine Webber J Prudential Bach 1 7 Q L c�2 1 L.F. Rothschild d� i0 p G r� 6 67 Salomon Bros, 3� 3 a Shearson Lehman y5 y 7 g �' �v �.2 1 SELECTION OF UNDERWRITERS P700 � CITY OF MIAMI��'`�1"; CONVENTION CENTER b PARKING GAP E '� REFUNDING BONDS FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL 5 POINTS 3 q ON in* In11 10% Yes or No vve •moo -- - �A Q 4J (..4-C. 7r. �r- A Bear Sterns 7V lob4 8 Dean Witter Oj r /y Dillon Reed 4 A A Pr.�. � u Drexel Burnham First Boston y,4-fig Equity 5/�,•Ifrw'� S First :7V / iul&l i�) Goldman Sachs 1u ti M.R. Hough v 3 Po«.�►.^Is E.F. Hutton 2 I Lazard Freres i Cac t- Merrill Lynch 3 PA-"Ja4be Morgan Stanley 3 Paine Webber ' Prudential Bach 7U w 8 L.F. Rothschild Salomon Bros. W ism Shearson L ma 137 r FIRM NAME A V SELECTION OF UNDERWR1TEicS S�togrL.isr _ yYr Jqs-rc-X. CITY OF' MIAMI CONVENTION CENTER b PARKING GARAGE s��v�•�� 1 v t� REFUNDING BON7S QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL 1 2 3 4 6 POINTS 601 101 101 lot Vet nr un dF3 r`'S FFK s-- I E:1 F F Dean Witter OHlor, Reed Aha m First Boston _Ei.r_&.t q y— Goldman Sachs W. R .—"UTjt-• E.F. Hutton 3 -Laz a-r-6 F reres Merrill Lynch i L /� Morgan —Stanley Paine Webber 3 Prudential Bach L . F . ' R o'i tFS*Chjj d' Salomon Bros—.-- Shearson Lehman :E 'r,-sor ......... r-z�:� 87-152► SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONIS FIRM NAME QUESTION QUESTION QUESTION QUESTION • A I r1 q. r �• i QUESTION`' TOTAL 5 POINT. Yac nr No 60%--- Dean Witter F1 do F i rs L--$ast on F j &z—E11447— Goldman Sachs E.F. Hutton Merrill Lynch {J Morgair-Stan iey Paine Webber Prudential Bach L . F . " ro ft S'C1'i 1-T Salomon -BrDs. Shearson Lehman �'�-1S2► 87-1:53 SELECTION OF UNDERWRITtka (CITY OF MIAMI CONVENTION CENTER & PARKING GARAGE REFUNDING BONIS FIRM NAME QUESTION QUESTION QUESTION QUESTION i .?. end Int QUESTION TOTAL 0INT5 Vat hr Nn ONb --- ave •�•• -- - -- Dean Witter Dean Dillon RC-C-d Goldman Sachs E.F. Hutton 4"+F4--F-re Fes Merrill Lynch Morgan —Stanley Paine Webber Prudential Bach �- L.F. 'Ro'Cii "1-T Salomon , Bros: Shearson Lehman I1 � J 87-153 WrI52► 1 5 SELECTION OF UNDERWRITERS / Ca CITY OF MIAMI C� CONVENTION CENTER A PARKING GARAGE REFUNDING BONS FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL q 5 POINT: .0% Sna i )q. Yae nr No s=-- Dean Witter Goldman Sachs E.F. Hutton z 4,&4 af4--F-rre res - Merrill Lynch M o r g an— Start I ey Paine Webber Prudential Bach L.F. 'Ro1rtis'C'"11r Salomon BrD . Shearson Lehman 3 87-153 87-152► SELECTION OF UNDERWRITERS kz CITY OF MIAMI �j CONVENTION CENTER & PARKING GARAGE REFUNDING BONDS FIRM NAME QUESTION QUESTION QUESTION QUESSTION QUESTION TOTAL p0INT5 1 iA& Ina, Vet nr Nn Dean Witter D +4 i a.. R e•ed-- Goldman Sachs �. W. R . Ncra'"-• E.F. Hutton ,4a.�af-d-•�reres Merrill Lynch i M o r g arr—Mart } ey Paine Webber Prudential Bach L.F. 'R-6 5'C"1V' Salomon Bross-. Shearson Lehman -6 8'7--152r 87r153 SELECTION OF UNDERWRITER)fit CITY OF MIAMI CONVENTION CENTER & PARKING GARAGE REFUNDING 8005 FIRM NAME QUESTION QUESTION QUESTION QUESSTION QUESTION TOTAL POINTS _i_ .... ine 1nut Yoe nr No Dean Witter D iF-H Goldman Sachs E.F. Hutton ...k� s Merrill Lynch ' y Paine Webber Prudential Bach S Shearson Lehman 87-152, 87-153, 11 SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE RrF UNO I NG g0►0S, FIRM NAME QUESTION QUESTION QUESTION QUESTION 1 2 3 4 Ant ]AS 101 in% QUESTION TOTAL 5 POINTS Ypt er No Dean Witter Dillon Reed First Boston Gol dman Sachs E.F. Hutton )Ell errill Lynch l ,IJ Morgan —Stanley Paine Webber Pruden tial Bach L.F. ROLNCM-1-T Salomon Bros: Shearson Lehman l� James,]. Lourrey & Co. 190 MAIDEN LANE NEW YORK. NEW YORK 10038 (212) 363.2000 December 15, 1986 < name > <company> <address> Dear <salutation>: The City of Miami, Florida (the "City') is soliciting proposals from you and certain other qualified Investment Banking Firms in order to select managing underwriters for the sale of bonds to advance refund a portion or all of the $60,000,000 Convention Center and Parking Garage Revenue Bonds dated July 1, 1980. The City is interested in accomplishing this financing to maximize present value savings. Preliminary legal research by a well known law firm indicates that these bonds are refundable and the proposed refunding is not sensitive to the end of the year sunset of the recently enacted tax legislation. The City requests the following information which should be included in the proposal in substantially the same order as outlined below: 1. Provide any ideas that you may have on the specific structure of the financing and the sale of bonds for the City's requirements. Indicate the estimated management fee and expenses that your firm would request. Final pricing on all elements of gross spread will be based upon prevailing market conditions and will be subject to negotiation by the City. 2. Provide the following information regarding your firm's experience in the issuance of advance refunding bond in Florida within the last two years: (i) issue name, (ii) dollar amount, and (iii) gross spread and its components. List the transactions according to the role your firm served. 8 7-152► Writ' V <name> December 15, 1986 Page 2 3. Please describe the structure of your Firm and its capital base. 4. Provide the names and brief resumes of the individuals with whom the City will work. 5. The City has a minority participation requirement of 501 (25% Black, 25% Hispanic) on all contracts. Your response should indicate how you will respond to this requirement. Any questions should be addressed to Adrienne McBeth, Minority Procurement Officer at (305) 579-6395. Since the City frequently issues bonds and is very familiar with investment banking firms, it would be appreciated if the proposals specifically answer questions 1) - 5) above in the first part of the proposal, limiting such section to approximately 10 typewritten pages. All other information which you consider necessary in your presentation should follow in separate appendices. Copies of the proposals should be distributed as follows no later than 12:00 noon on Wednesday, December 31, 1986. Number of of Copies Individual 5 Carlos Garcia Director of Finance City of Miami 3500 Pan American Drive Miami, FL 33133 2 Michael W. Geffrard James J. Lowrey 6 Co. 180 Maiden Lane New York, NY 10038 If there are any questions regarding this Request for Proposals, please contact either Carlos Garcia at (305) 579-6350 or Michael Geffrard at (212) 363-2000 Very truly yours, Michael W. Geffrard MWG:dm 8►7-152► 87--153 so CITY OF MIAMI, FLORIDA INTER -OFFICE MEMORANDUM To Honorable Mayor and Members DATE January 29, 1987 FILE: of the City Commission SUSUECT Underwriter Selection for the Convention Center - Garage Refinancing FROM REFERENCES. Cesar H. Odio For City Commission City Manager ENCLOSURES Meeting of 2-12-87 RECOMMENDATION: It is respectfully recommended that the attached Resolution selecting and . appointing underwriters for the City of Miami Convention Center - Parking Garage Refunding Bonds, refunding all or a portion of the City's outstanding $60,000,000 Convention Center and Parking Garage Revenue Bonds, and authorizing the City Manager to negotiate a contract for said underwriting services, be approved. BACKGROUND: At the City Commission meeting of December 11, -1986, the Commission instructed the City Manager to initiate a Request for Proposal (RFP) process, for the possible refinancing of outstanding City of Miami Convention Center - Parking Garage Bonds. The Finance Department, in con junction with the City's financial advisory firm, James J. Lowrey & Co., prepared and distributed a RFP for th•e underwriting services for this bond refinancing. A Selection Committee was appointed by the City Manager, as follows: Diane Cook - Treasurer, University of Miami Carlos E. Garcia - Director of Finance Ray E. Good, Chairman, Finance & Audit Committee, University of Miami Tony Pa j ares - Executive Director, Conference & Conventions Department Waiter Pierce - Assistant City Manager 8 7~1.5Z. f; r. Honorable Mayor and Members of the City Commission Page - 2 - The review committee met on January 21, 1987 and reviewed the proposals submitted, based upon the following criteria: 1. Proposed structure of the financing and projected fees and expenses. 2. Experience in the issuance of advance refunding bonds in Florida within the past two years. 3. Structure of the Firm and Capital base. 4. Indivi.duals who will be assigned to this transaction. 5. Minority participation and compliance with the City's Minority Procurement Ordinance. 6. Additional relevant qualifications and experience. Attachment A, summarizes the seventeen proposals received from various underwriting firms, or teams of firms. The Review Committee selected three firms/teams, in the following ranking of preference: Shearson Lehman Brothers, Grigsby Bran dford (B1 ack firm) , AIBC Investments (Hispanic firm). Drexel Burnham Lambert Merrill Lynch - Both Drexel Burnham Lambert, and Merrill Lynch, indicated in their proposals that they will comply with the City's Minority requirement if selected as Managing Underwriters. Approval of this transaction will appoint the Managing Underwriters and will authorize the City Manager to negotiate a contract for underwriting services. The purpose of this advance refunding transaction is to allow the City to take advantage of the low interest rates available in the tax-exempt capital market at present. It is estimated by the City's financial advisor, James J. Lowrey & Company, that this refinancing would save the City approximately $3:0 - $3.5 million in present value dollars. cc: City Attorney Z 87-15a1 i 87-153► Follows is a short summary of the respon a, answers to Questio, �o. 1 in the Request For Underwrites Proposal. The question read as follows: Provide any ideas that you may have on the specific structure of the financing and the sale of bonds for the City's requiresiehts. The respondents are listed in alphabetical order. Bear Stearns o submitted standard refunding analysis Dean Witter/Metro Equities o discussed various refunding strategies including the use of TEDBs, CABS and variable rate Dillon Read o discussed various refunding strategies including use of surety bond and subordinate obligations Drexel Burnham Lambert o discussed the use of a debt service reserve surety bond First Boston o discussed the use of CABS and insurance First Equity o did not answer question Goldman Sachs/Daniels i Bell/M Securities o discussed the use of CABS and a surety bond William R. Hough/WR Lazard/United Daniels/Southwestern Capital o discussed options for the debt service reserve fund EF Hutton o discussed various refunding strategies using insurance and issuing warrants Lazard Freres o submitted standard refunding analysis Merrill Lynch o discussed various refunding strategies including the use of insurance, variable rate debt and automatic calla Morgan Stanley o. discussed various refunding strategies including the use of GICs, cross-overs, ARROS and insurance PaineWebber o submitted standard refunding analysis Prudential Bache o discussed structuring of issue and the use of OIDs and a crossover refunding LF Rothchild/Pyror, Govan o submitted standard refunding analysis Salomon Brothers o discussed various refunding strategies including use of surety bond and subordinate obligations Shearson Lehman/Grigsby Brandford/AIBC o discussed the use of CABS S'7-154-1 8 7-153 3 ASSUMED TOTAL EXPERIENCE SIZE OF INTEREST RATE/ ESTIMATED ESTIMATED IN FLORIDA CAPITAL PROPOSED ESTIMATED PRES. MANAGEMENT FEE TAKEDOWN ADVANCE STRUCTURE PROPOSER ISSUE VALUE SAVINGS ($ MILLIONS) EXPENSES/BASED ON SIZE OF ISSUE AND RISK/BASED ON SIZE OF ISSUE REFUNDINrS # (In Billions) OF THE FIRM ($ Billions) PERSONNEL ASSIGNED MINORITY PARTICIPATION Bear Stearns $51,585,000 NIC 7.06% $128,962 $438,473 19 $1.7 $.920 Hayden Will Comply TIC 7.275% Institutional Melvin $3.45 and Retail Alvarez Arone Dean Witter/ Metro Equities Not Provided TIC 6.938% $150,000 Not Provided 32 $1.4 $1.3 Dunlap Metro Equi- $3.3 - $4.2 (Based on Institutional Jordan ties (Black $60,000,000) and Retail Moorhead Firm) Seaton, Etc. Dillon Read $51,710,000 NIC 6.95% $193,913 - $478,317 - 4 $ .6 $.110 Faupl Will Comply $251,343 $619,918 Institutional Traudt Imhoff Schmitt,Etc. Drexel Burnham $65,905,000 NIC 6.96% $15,715 $572,055 12 $1.1 $1.8 Burnett Will Comply Lambert $4.6 Institutional Middlemas and Retail Maisio Christenson Ang � First Boston $61,523,690 TIC 6:76% Total Grdss 8 $1.42 $1.2 Spread Hall Will Comply $5.649 $922,229 Institutional LaMaita Penney Urheim First Equity Not Provided Not Provided Not Provided Not Provided 3 $.i41 $.002 Will Comply �j Retail Parera Schubert . Fernandez ASSUMED INTEREST RATE/ TOTAL ESTIMATED ESTIMATED SIZE OF ESTIMATED PRES. MANAGEMENT FEE TAKEDOWN PROPOSED VALUE SAVINGS ($ MILLIONS) EXPENSES/BASED ON SIZE OF ISSUE AND RISK/BASED ON SIZE OF ISSUE PROPOSER ISSUE Goldman Sachs $59,775,000 - Not Provided $179,325 $537,975 - Daniels & Bell $66,110,000 $314,022 $677,627 M Securities $3.4 - $3.5 EXPERIENCE IN FLORIDA CAPITAL ADVANCE STRUCTURE REFUNDINGS OF THE FIRM PERSONNEL MINORITY N (In Billions) ($ Billions) ASSIGNED PARTICIPATION 26 $2.6 Spector, Schott Daniels & Bell $1.2 Fagan, Montes (Black Firm) Institutional Gomez, Gary M Securities Scott, Ourlict (Hispanic Firm) W.R. Hough Not Provided 33 $3.06 W. R. Lazard Not Provided Not Provided $130,000 United Daniels (Based on Southwestern $6.0 $60,000,000) Capital Mkts. • 30 $3.6 E. F. Hutton $60,000,000 NIC 6.754% $117,000 $495,000 $6.178 Lazard Freres . TIC 6.948 . $67,258,840 $235,403 - $470,906 - 5 $.74 $437,177 $554,878 $5.16 --- 768 Gross Spread 40 --- 53.25 Merrill.Lynch $12,768,229 MIIC 7.17a Co- IC$Fee Not Broken Down $3.78 - $4.7 $873,216 $.007 Bennett Daniels Lazard & Daniels Institutional McDonald Moss (Black Firm) Lazard Keller Southwestern Rodriguez Capital Mkts. Dimas (Hispanic Firm) $1.1 Cahalan Institutional Schuit and Retail Connaughten Aeekin $.70 Tamagin Institutional $2.4 Frasca Institutional Jahnes and Retail Wendt Press 3 $.063 — $1.5 Mabon Morgan Stanley $65,610,000 - 7.107% Bellamy $64,025 $492,075 Institutional Musca W . $66,600,000 $3.7 - $10.9 $66,500 $666;000--------------------_--- Yee — 1 i CC71 CAN Will Comply Will Comply Will C00101V Will Comply L) ASSUMED TOTAL EXPERIENCE INTEREST RATE/ ESTIMATED ESTIMATED IN FLORIDA CAPITAL SIZE OF ESTIMATED PRES. MANAGEMENT FEE TAKEDOWN ADVANCE STRUCTURE PROPOSED VALUE SAVINGS EXPENSES/BASED AND RISK/BASED REFUNDINGS OF THE FIRM PERSONNEL PROPOSER ISSUE ($ MILLIONS) ON SIZE OF ISSUE ON SIZE OF ISSUE # (In Billions) ($ Billions) ASSIGNED Paine Webber $55,505,000 7.074% 17 $1.4 $1.03 Pellegrini $138,762 Institutional Denton Rein $5.48 $416,287 & Retail Olson Paret Prud::ptiai Gache $64,370,000- Not Provided $543,926 - 37 $2.6 $4.21 Pairer$g0,118 Mace ' $66,335,000 $5.36 - $5.37 $92,869 $560,530 Institutional Soviero and Retail Bryant Salomon Brothers NIC 7.182 20 $2.7 $3.1 Spraggins $50,665,000 - TIC 7.25% $179,354 $426,092 Institutional Strauss $51,650,000 $182,841 Amundson $2.58 - $3.74 O'Brien Mashoff L. F. Rothschild $67,725,000 TIC 6.98% 3 $.254 $.350 Berenyi Prior, Govan $118,518 $778,837 Institutional Singer $3.826 Vereen Counts Pryor, etc. Shearson Lehman NIC 7.006% $113,000 1 $577,080 - 11 $2.34 $2.74 Greenfield IF Grigsby Brnadford $63,000,000 $653,940 Institutional Montalbano i"& AIBC $3.5 - $3.8 and Retail Cordell Borys 1Subsequent to the receipt of the proposal, the proposer provided information indicating that the Management fee would apply only -to the Co -Manager at a rate of $1.00 per bond. CA N MINORITY PARTICIPATION Will Comply Will Comply Will Comply Pryor, Govan (Black Firm) Grigsby Branford (Black Firm) AIBC (Hispanic Firm) / f b ��- SELECTION OF UNDERWRITERS "� if''1S CITY OF MIAMI 0./ `' f � CO MENTION CENTER b PARKING GARAGE *�Ldt REFUNDING BONI�S FIRM NAME F'rs /` /o tP f , y QUESTION S Yes or No TOTAL POINTS t Dean Witter ,D411--a Reed Drexel Burnham 04 First -Boston rtY� 3►3�1 3-;3 Goldman Sachs C`3 �*.A. Hough 1 E.F. Hutton 8 eres I Merrill Lynch y R gan Stanley Paine Webber Prudential Bach i 4 �1 u L : F : Rb-Tr r?M d Salomoa- Bras, SJ y.� Shearson Lehman 87-153 87-152, SELECTION OF UNDERWRITEi:. CITY OF MIAMI CONVENTION CENTER 6 PARKING GARAGE REFUNDING BONDS i FIRM NAME QUESTION QUESTION QUESTION QUESTION 1 2 3 4 QUESTION POTAL OINTS cs� /-j*60% 110(11) 10% 10% iul Yes or no Bear Sterns 1 '?, 7 7 4r G Dean Witter Dillon Reed @Drexel 'Ys 7 9 is + Burnham First Boston i First Equity ),' 3 � i � -s" Goldman Sachs W.R. Hough .30 E.F. Hutton �� %p 7 Lazard Freres Merrill Lynch �s g Morgan Stanley Paine Webber 30 C.. / " Prudential Bachi 3 / 7 �0 L.F. Rothschild F Salomon Bros. 7$ (�hearson Lehman S'7-153► 8'7-1S2► SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONDS FIRM NAME Q STION QUESTION QUESTION QUESTION QUESTION TOTAL 10 2 3 4 POINTS n, KhIL An i n% 10t 10% Yes or No — Bear Sterns I —,.-- S .� 9. F Dean Witter 3 46 y I Dillon Reed Drexel Burnham ,3� 6 5 63 (I) First Boston First Equity Goldman Sachs 5 N.R. Hough O E.F. Hutton S 7 Z 7 Lazard Freres S d Merrill Lynch 3jr 5 ` ( S 3 5r Morgan Stanley Paine Webber �' 6- Pruden � 1 Bachi 110 7� L.F. Rothschild 7 0 6 Salomon Bros. Shearson Lehman 3s S .S ✓ / a �S 87-153 g7-15' 61:;C -✓" G► SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONDS FIRM NAME QUESTIONQUESTION QUESTION QUESTION I (4 2 3 4 3OAr Fes' 100 I QV 100 QUESTION TOTAL 5 /o POINTS Bear Sterns 3 y 5 5 C, Dean Witter 3 CIO Z Dillon Reed 3 -� 3 Drexel Burnham �� 7 d- c6> First Boston L/ 3 �„ First Equity Goldman Sachs J 3 J (� N.R. Hough L/ E.F. Hutton L/ 7 7 % q q 21 Freres 3 SLazard Merrill Lynch `1 7 J iv G Morgan Stanley t� 1-31 1; <70 3 Paine Webber Prudential Bach L.F. Rothschild 3, 7 1 z V G Salomon Bros. `/ ? �% u l 7 v J Shearson Lehman w SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONDS FIRM NAME QUESTION QUESTION QUESTION QUESTION 1 .,-�. f erbf&p# QUESTION TOTAL 5 (jol.) POINTS xL Bear Sterns�- Icgq 1 IM 10% 10% IU% Yes o , No Dean Witter 10 9 a, Dillon Reed 7D Drexel Burnham Iv y g First Boston S First Equity PGoldman Sachs M.R. Hough /(� %•� �� , E.F. Hutton Lazard Freres OMerrill Lynch Morgan Stanley Paine Webber ?Prudential Bach C% L.F. Rothschild p Salomon Bros. .. Shearson Lehman - � 1 SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GAk.AGE REFUNOING BONDS FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL 14 is 2 3 4 � A 5 fi POINTS Bear Sterns 2c /07 g 1 9 7 -- - F/// Dean Witter Dillon Reed Drexel Burnham 3� �0 g g J G8 First Boston First Equity 123 Goldman Sachs N' '` 4d 80 W.R. Hough 3` Q 10 76 C E.F. Hutton 73 Lazard Freres I Merrill Lynch to Morgan Stanley Paine Webber J Prudential Bach 1 7 Q L c�2 1 L.F. Rothschild d� i0 p r� Salomon Bros. Shearson Lehman Y5 y 7 ... _ 3 SELECTION OF UNDERWRITERS P700 � CITY OF MIAMI��'`�1"; CONVENTION CENTER b PARKING GAP REFUNDING BONDS FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL 5 POINTS 3 q ON in* In11 10% Yes or No vve •moo -- - �A Q 4J (..4-C. 7r. �r- A Bear Sterns 7V lob4 8 Dean Witter Oj r /y Dillon Reed 4 A A Pr.�. � u Drexel Burnham First Boston y,4-fig Equity 5/�,•Ifrw'� S First :7V / iul&l i�) Goldman Sachs 1u ti M.R. Hough v 3 Po«.�►.^Is E.F. Hutton 2 I Lazard Freres i Cac t- Merrill Lynch 3 PA-"Ja4be Morgan Stanley 3 Paine Webber ' Prudential Bach 7U w 8 L.F. Rothschild Salomon Bros. W ism Shearson L ma 137 r A V SELECTION OF UNDERWR1TEicS S�togrL.isr _ _ yYr Jqs-rc-X. CITY OE' MIAMI CONVENTION CENTER b PARKING GARAGE s��v�•�� 1 v t� REFUNDING BON7S FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL 1 2 3 4 6 POINTS 601 101 10% lot Vet nr un dF3 FFK s-- I E:1 F F Dean Witter OHlor, Reed Aha m First Boston _Ei.r_&.t q y— Goldman Sachs W. R .—"UTjt-• E.F. Hutton 3 -Laz a-r-6 F reres Merrill Lynch i L /� Morgan —Stanley Paine Webber 3 Prudential Bach L . F . ' R o'i tFS*Chjj d' Salomon Bros—.-- Shearson Lehman :E 'r,-sor ......... r-z�:� 87-152► SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONIS FIRM NAME QUESTION QUESTION QUESTION QUESTION • A I r1 q. �- i QUESTION`' TOTAL 5 POINT. Yac nr No 60%--- Dean Witter F1 do F i rs L--$ast on F j &z—E11447— Goldman Sachs E.F. Hutton Merrill Lynch {J Morgair-Stan iey Paine Webber Prudential Bach L . F . " ro ft S'C1'i 1-T Salomon -BrDs. Shearson Lehman �'�-1S2► 87-1:53 0 0 SELECTION OF UNDERWRITtka (CITY OF MIAMI CONVENTION CENTER & PARKING GARAGE REFUNDING BONIS FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL 0INT5 Vat hr Nn ONb s--- ave •�•• -- - -- Dean Witter Dillon RC-C-d Goldman Sachs E.F. Hutton 4"+F4--F-re Fes Merrill Lynch Morgan —Stanley Paine Webber Prudential Bach �- L.F. 'Ro'Cii "1-T Salomon , Bros: Shearson Lehman I1 � J 87-153 WrI52► 1 5 SELECTION OF UNDERWRITERS /'" Ca CITY OF MIAMI C� CONVENTION CENTER A PARKING GARAGE REFUNDING BONS FIRM NAME QUESTION QUESTION QUESTION QUESTION QUESTION TOTAL q 5 POINT! 101. ,Aa inct In% Yot or No _- wwo-- Dean Witter Goldman Sachs E.F. Hutton z 4,&4 af4--F-rre res - Merrill Lynch M o r g an— Start I ey Paine Webber Prudential Bach L.F. 'Ro1rtis'C'"11r Salomon BrD . Shearson Lehman 3 87-153 87-152► SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER & PARKING GARAGE REFUNDING BONDS FIRM NAME QUESTION QUESTION QUESTION QUESSTION QUESTION TOTAL 1 iA& 1nR Vet nr Nn Dean Witter D +4 i a.. R e•ed-- Goldman Sachs �. W. R . Ncra'"-• E.F. Hutton ,4a.�af-d-•�reres Merrill Lynch i M o r g arr—Mart } ey Paine Webber Prudential Bach L.F. 'R-6 5'C"1V' Salomon Bross-. Shearson Lehman -6 8'7--152r 87r153 SELECTION OF UNDERWRITER)fit CITY OF MIAMI- CONVENTION CENTER & PARKING GARAGE REFUNDING BOOS FIRM NAME QUESTION QUESTION QUESTION QUESSTION QUESTION TOTAL POINTS .... ine 1nut Yae nr No Dean Witter D Goldman Sachs E.F. Hutton ..k�peep ps Merrill Lynch ' y Paine Webber Prudential Bach S Shearson Lehman 87-152, 87-153, 11 SELECTION OF UNDERWRITERS CITY OF MIAMI CONVENTION CENTER A PARKING GARAGE REFUNDING BONDS, FIRM NAME QUESTION QUESTION QUESTION QUESTION 1 2 3 4 60% 101 10% 10% QUESTION TOTAL 5 POINTS Yes or No Dean Witter Dillon Reed Aham First Boston Gol dman Sachs E.F. Hutton )Ell -4al ofd s errill Lynch l ,1j Morgan —Stanley Paine Webber Pruden tial Bach L.F. ROLNCM-1-T Salomon Bros: Shearson Lehman l� James,]. Lourrey & Co. 190 MAIDEN LANE NEW YORK. NEW YORK 10038 (212) 363.2000 December 15, 1986 < name > <company> <address> Dear <salutation>: The City of Miami, Florida (the "City') is soliciting proposals from you and certain other qualified Investment Banking Firms in order to select managing underwriters for the sale of bonds to advance refund a portion or all of the $60,000,000 Convention Center and Parking Garage Revenue Bonds dated July 1, 1980. The City is interested in accomplishing this financing to maximize present value savings. Preliminary legal research by a well known law firm indicates that these bonds are refundable and the proposed refunding is not sensitive to the end of the year sunset of the recently enacted tax legislation. The City requests the following information which should be included in the proposal in substantially the same order as outlined below: 1. Provide any ideas that you may have on the specific structure of the financing and the sale of bonds for the City's requirements. Indicate the estimated management fee and expenses that your firm would request. Final pricing on all elements of gross spread will be based upon prevailing market conditions and will be subject to negotiation by the City. 2. Provide the following information regarding your firm's experience in the issuance of advance refunding bond in Florida within the last two years: (i) issue name, (ii) dollar amount, and (iii) gross spread and its components. List the transactions according to the role your firm served. 8 7-152► Writ' V <name> December 15, 1986 Page 2 3. Please describe the structure of your Firm and its capital base. 4. Provide the names and brief resumes of the individuals with whom the City will work. 5. The City has a minority participation requirement of 501 (25% Black, 25% Hispanic) on all contracts. Your response should indicate how you will respond to this requirement. Any questions should be addressed to Adrienne McBeth, Minority Procurement Officer at (305) 579-6395. Since the City frequently issues bonds and is very familiar with investment banking firms, it would be appreciated if the proposals specifically answer questions 1) - 5) above in the first part of the proposal, limiting such section to approximately 10 typewritten pages. All other information which you consider necessary in your presentation should follow in separate appendices. Copies of the proposals should be distributed as follows no later than 12:00 noon on Wednesday, December 31, 1986. Number of of Copies Individual 5 Carlos Garcia Director of Finance City of Miami 3500 Pan American Drive Miami, FL 33133 2 Michael W. Geffrard James J. Lowrey 6 Co. 180 Maiden Lane New York, NY 10038 If there are any questions regarding this Request for Proposals, please contact either Carlos Garcia at (305) 579-6350 or Michael Geffrard at (212) 363-2000 Very truly yours, Michael W. Geffrard MWG:dm 8►7-152► 87--153