HomeMy WebLinkAboutExhibit 1 - Bank Loan RFPThe PFM Group
Public Financial Management, Inc.
PFM Asset Management LLC
PFM Advisors
Memorandum
Suite 404 305-448-6992
255 Alhambra Circle 305-448-7131 fax
Coral Gables, FL 33146 www.pfm.com
April 3, 2014
To: Prospective Bond Providers
Frorn: Public Financial Management on behalf of the City of Miami
Re: City of Miami, Florida: Request for Bank Bond Proposals — Special Obligation Bonds
As financial advisor to the City of Miami, Florida (the "City") Public Financial Management, Inc.
(PFM) is seeking proposals on behalf of the City in order to refund outstanding bonds through a
privately placed bond (the "Bond"). The Bond will be awarded based on overall borrowing cost and
terms most favorable to the City, based on the City's sole discretion. The financing will be a private
placement structured as Refunding Bonds issued under a City resolution for special obligation
bonds. The City will not be preparing an offering statement with respect to the Bond.
The Bond will be issued in an amount not to exceed $22,000,000. The payment of the principal and
interest on the Bond are limited obligations of the City payable solely from and secured by the
Pledged Revenues. Pledged Revenues consist of (1) Covenant Revenues deposited into the Sinking
Fund established by Resolution, and (2) income received from the investment of moneys deposited
in the funds and accounts established under the Resolution. Covenant Revenues are a defined term
in the City's prior series resolutions, and will be identical for purposes of this Bond. Covenant
Revenues are effectively defined to mean legally available non -ad valorem revenues budgeted and
appropriated to pay the principal of, premium, if any, and interest on the Bonds. Please read the full
definition of the Pledged Revenues in the prior documents provided as a link to this RFP.
The proceeds of the Bond will be used to current refund all of the outstanding Special Obligation
Bonds, Series 2002A (Special Obligation Non -Ad Valorem Revenue Refunding Bonds) and a
portion of the Series 2002C (Special Obligation Non -Ad Valorem Revenue Refunding Bonds). The
Series 2002A Bonds being refunded are currently outstanding in the amount of $13,255,000 and
mature on September 1s` in years 2015-2025. The Series 2002C Bonds being refunded are currently
outstanding in the amount of $7,430,000, and mature and October 1" in years 2015-2017.
The City has other Special Obligation Bonds outstanding (most recently the Series 2012). The City's
Special Obligation Bonds currently maintain credit ratings of "A3," "BBB-" and "BBB+" from
Moody's, Standard & Poor's, and Fitch Ratings, respectively.
Below are links to additional financial information regarding the City:
2013 CAFR
Series 2002A: Official Statement
Series 2002C: Official Statement
Other key terms as follows:
• Interest Payment Dates: April 1 and October 1, commencing October 1, 2014
• Principal Payment Dates: October of each year, commencing October 1, 2014
• Final Maturity Date of October 1, 2025
• 30/360 Day Count Basis
• Bond Closing: Approximately July 1, 2014
• Preliminary Amortization:
Preliminary Amortization
Date Principal
10/1/2015 3,450,000
10/1/2016 3,570,000
10/1/2017 3,690,000
10/1/2018 1,130,000
10/1/2019 1,165,000
10/ 1 /2020 1,205,000
10/1/2021 1,250,000
10/1/2022 1,285,000
10/ 1 / 2023 1,330,000
10/ 1 /2024 1,375,000
10/ 1 / 2025 1,420,000
The City is requesting proposals be submitted by Friday, May 2, 2014 at 2:00 PM Eastern Time
to the City's Financial Advisor (PFM) at the following email address: masvi.dals@pfm.com. Each
proposal shall include the interest rate, prepayment provisions, fees, and other terms/conditions.
The Bond will be issued under the current covenants detailed in the City's prior resolutions.
The 2014 Refunding Bond does not contemplate funding a debt service reserve fund. Please
keep in mind when submitting proposals that the City will not accept any offer with capital
adequacy or other interest rate adjustment language. The only interest rate adjustment
provision the City will accept will be a covenant related to an interest rate adjustment upon
a final determination from the IRS that a City -caused taxability event occurred which affects
the after-tax yield on the Bond. If the Bond is outstanding and is deemed taxable during its
term, the purchaser may adjust the interest rate, starting after such determination, to
maintain the same after-tax yield as originally accepted by the City.
The successful bidder will be required to deliver certain certificates at closing including one to the
effect that they are a sophisticated investor having knowledge and experience in financial and
business matters and are capable of evaluating the merits and risks of the Bond, that they have had
access to and have reviewed such information concerning the City as they have deemed necessary,
that they understand the Bond is not a general obligation of the City, but is payable solely by the
revenues to be described in the series resolution, that they are not relying on disclosures from the
City and that they are buying the Bond for their own accounts and not with a view for resale or
redistribution. The Bond may be assigned in whole but not in part and only to sophisticated
investors.
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The City's Bond Counsel, will prepare all financing documents and render the approving opinion,
and bank counsel's role will be review only. PFM will serve in the sole capacity of financial advisor
to the City and not in the role as placement agent for the Bond. Any inquiries or requests
concerning clarification or solicitation for additional information shall be submitted to PFM at the
email address above.
THE CITY RESERVES THE RIGHT TO REJECT ANY OR ALL BIDS AND RESERVES
THE RIGHT TO WAIVE, IF PERMI'FI ED BY LAW, ANY IRREGULARITY OR
INFORMALITY IN ANY PROPOSAL.
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