2021-09-01 City Council Item No. 12.3 - Refinance of the 2019 Streetlight Financing Agreement with Banc of America Leasing & Capital Presentation Regular MEETING - Additional Meeting MaterialsItem #12.3: Refinance of the
Streetlight Financing Agreement
with Banc of America Leasing &
Capital
Wendy Preece –Deputy Finance Director
Nicolas Fidler –Public Works Director
Ron Puccinelli –IT Director
September 1, 2021
DISCUSSION
•At the June 19, 2019 City Council Meeting, council approved the purchase
from SCE, and the LED retrofit, of City streetlight poles
•Original amount financed was $6,550,000 at 4.3%
•Payments were due from June 2020 through June 2034 with principal and
interest totaling $9,030,489 over the life of the agreement
•The current outstanding principal balance is approximately $6,309,001
with remaining payments of $8,096,300, including interest, through June
2034
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DISCUSSION (cont.)
•With this refinancing, the interest rate will be lowered to 2.99% with an
estimated annual savings of $30,826 and total savings of $400,738 over
the life of the loan
•This item was reviewed and supported by the Finance Committee at its
meeting held on August 16, 2021
•The General Fund will not be responsible for making payments on
this refinancing of the Streetlight debt
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DISCUSSION (cont.)
Taxable
(2.99%)
Tax-Exempt
(2.36%)Savings
Interest:1,299,308 1,015,217 (284,091)
5G Small Cell*
Possible Revenue:Fiscal Year
# of Poles
(+10%/Year)
Annual
Revenue
($270/Pole)
Cumulative
Total
FY 22/23 100 27,000 27,000
FY 23/24 110 29,700 56,700
FY 24/25 121 32,670 89,370
FY 25/26 133 35,937 125,307
FY 26/27 146 39,531 164,838
FY 27/28 161 43,484 208,321
FY 28/29 177 47,832 256,154
(break-even point)FY 29/30 195 52,615 308,769
FY 30/31 214 57,877 366,646
FY 31/32 236 63,665 430,310
FY 32/33 259 70,031 500,342
FY 33/34 285 77,034 577,376
577,376
*Verizon, AT&T, T-Mobile
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The City of Menifee has opted for
Taxable financing rates instead of
Tax -Exempt financing rates, so that
in the future there will be the ability
to use the poles for various revenue
generating endeavors. One such
revenue generating plan could be to
charge annual leases for the
placement of 5G small cells to the
mobile telephone companies.
DISCUSSION (cont.)
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Additional
Attachment
Revenue
Opportunities
FISCAL IMPACT:
•With this refinancing, savings will be recognized in the following special
revenue funds:Fund #Fund Description
Count of
Streetlights % of Total
Annual
Savings
Total
Savings
200 Gas Tax 624 9.47%2,918 37,939
387 LMD 89-1C ZONE 118 12 0.18%56 728
391 LMD 89-1C ZONE 133 45 0.68%210 2,735
394 LMD 89-1C ZONE 176 5 0.08%23 302
395 LMD 89-1C Group 4 37 0.56%173 2,253
420 CSA 33 11 0.17%52 673
430 CSA 43 50 0.76%234 3,037
450 CSA 84 3325 50.45%15,551 202,169
460 CSA 86 146 2.22%683 8,877
470 CSA 138 42 0.64%197 2,556
480 CSA 145 1850 28.07%8,652 112,482
490 CFD 2012-2 313 4.75%1,464 19,031
493 CFD 2014-2 4 0.06%19 247
494 CFD 2017-1 24 0.36%112 1,457
641 CFD 2015-2 Zone #12 92 1.40%430 5,593
642 CFD 2015-2 Zone #13 6 0.09%29 371
644 CFD 2015-2 Zone #15 1 0.02%4 55
646 CFD 2015-2 Zone #17 1 0.02%4 55
662 CFD 2015-2 Zone #32 3 0.05%14 179
6591 100.00%30,826$ 400,738$
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RECOMMENDED ACTION:
Adopt a resolution of the City Council of the City of Menifee,
California, authorizing the execution and delivery of an
Amended and Restated Equipment Lease/Purchase
Agreement with Banc of America Leasing & Capital, LLC and
an Amended and Restated Paying Agent Agreement; and
authorizing certain actions in connection therewith.
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Thank you
Questions?