THE PORT EVERGLADES DEPARTMENT RECOMMENDS APPROVAL.
This item supports the Broward County Board of County Commissioners Value of "Ensuring economic opportunities for all people and businesses in Broward" and Goal to "Increase the economic strength and impact of revenue-generating County enterprises balancing economic, environmental, and community needs."
On May 23, 2017 (Item No. 66), the Board approved an Agreement for the Managing General Contractor for the Southport Turning Notch Expansion and Southport Crane Infrastructure Improvements projects at Port Everglades. The fiscal impact section of this item indicated staff's intent to bring a future item to the Board to authorize submittal of a Letter of Interest (LOI) to the USDOT for a Transportation Infrastructure Finance and Innovation Act (TIFIA) direct loan to partially fund the project. This LOI (Exhibit 1) is titled the Intermodal Freight Connector Project for the purpose of the application and has been packaged to meet project eligibility requirements of the TIFIA loan program. The LOI is on the Fiscal Year 2016 Form since USDOT has not released the Fiscal Year 2017 Form.
The total amount of TIFIA program funding to be requested is $132,755,442, representing 33% of total estimated eligible project costs (maximum allowable). The interest rate on a TIFIA direct loan is equal to or greater than the U.S. Treasury securities yield of comparable maturity on the credit agreement's date of execution, expected to result in interest cost savings for the County when compared to a traditional municipal bond financing. Based on interest rates as of May 11, 2017, the estimated average savings associated with the TIFIA loan compared to both non-AMT and AMT municipal bonds issued in the same amount ranges between $855,000 to $1,041,000 annually, or between $25,645,080 to $31,233,280 over the 30 year period of the loan (see Exhibit 2).
Submittal of the LOI is the first step in the TIFIA loan application process, which is followed by a creditworthiness and application review. USDOT will require the $250,000 fee payment to cover the cost of financial and/or legal advisors for that review process. If the application is approved, credit and business terms for the financing are negotiated directly with USDOT and a loan agreement is drafted. The loan agreement will be brought back to the Board for approval once the terms are established. |