STRATEGIC PRIORITY: Government Performance & Financial Management
AGENDA DATE: April 26, 2023
COUNCIL DISTRICT(S): N/A
DEPARTMENT: City Controller's Office
EXECUTIVE: Jack Ireland
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SUBJECT
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A resolution approving notes issued pursuant to a commercial paper program to finance improvements at Dallas Love Field - Financing: No cost consideration to the City
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BACKGROUND
On December 9, 2020, City Council authorized the Love Field Airport Modernization Corporation (LFAMC) to establish an Airport System Commercial Paper Program, effectively, the Love Field Airport Modernization Corporation Airport System Commercial Paper Notes, AMT Series (the "Notes"), in an aggregate principal amount not to exceed $150,000,000.
Commercial paper provides interim financing for capital projects. The use of commercial paper permits more cost-efficient use of capital as short-term debt is issued to closely match the amount and timing of the award of capital project contracts. Commercial paper notes are normally sold at rates of interest that are lower than rates available at the same time on long-term debt. Outstanding commercial paper is periodically reduced by refinancing it with long-term debt.
Pursuant to the provisions of section 147(f) of the Internal Revenue Code of 1986 (the "Code"), it is necessary for City Council, on a periodic basis, to approve the Notes and the projects to be financed and refinanced with the proceeds thereof, in order to enable the Notes to qualify as tax-exempt obligations under the Code. On March 27, 2023, a designated hearing officer of the LFAMC conducted a precursory public hearing with respect to the Notes and the Eligible Projects, in compliance with the provisions of section 147(f) of the Code.
The City's bond counsel with respect to the LFAMC, McCall, Parkhurst & Horton LLP, recommend annual City Council approval by Resolution to ensure compliance as it relates to t...
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