Prepayment of the University of Virginia’s share of the 800 MHz Radio System Financing
Requesting authorization for County Executive to accept the University of Virginia’s request to prepay their pro-rata share of the 800 MHz Radio System Financing.
Messrs. Tucker, Breeden; Ms. White
LEGAL REVIEW: Yes
July 7, 2004
ACTION: X INFORMATION:
An agreement entered into in June 2003 between the County of Albemarle, City of Charlottesville and the University of Virginia provided for the financing, funding and repayment of costs associated with the implementation of the joint 800 MHz Radio System. The County as fiscal agent agreed to finance $7 million of this project using a lease purchase agreement with the Bank of America, and the City and University agreed to reimburse the County for their pro-rata share of the annual repayments.
4.2. Fund County services in a fair, efficient manner and provide needed public facilities and infrastructure.
The University's share of the project was 15.03% with their pro-rata share of the financing being $1,052,100. Based on the repayment schedule the University has reimbursed the County for their share of the first payment made in May 2004 in the amount of $44,884.92 leaving a balance due of $1,007,215.08. The University has recently expressed a desire to pay off their remaining balance.
After reviewing the County's planned financings in FY 04/05 and the unanticipated Levy property acquisition it would appear to be in the County's best interest to allow the University to prepay this portion of their obligation and retain this amount for the County's current capital plans. Since the total financing was by the County, the only action required to accomplish this would be notification to the University of the County's agreement and acknowledgement of their payment. This amount along with the additional state revenue would provide approximately the amount needed for the Levy property purchase. In addition, the interest rate of 3.2755% on this financing was much better than we can anticipate now or on financings in the near future.
If the Board is in agreement with this plan, staff is requesting authorization for the County Executive to notify the University of approval of their request along with the total amount due including interest from May 2004 to the date of payment. Staff will also prepare an appropriation request for future action covering the County's increased share of the debt service payments. The annual increase in debt service payments for the 10 year term will be $124,232.
Staff recommends the Board of Supervisors authorize the County Executive to accept the University of Virginia’s request as detailed above.
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