Bond Sale Successful!

The District successfully sold $24,000,000 of the Series 2019 Bonds at a 3.3% interest rate on Wednesday November 13, 2019.

Sale Produced Superior Results Compared to What was Expected

The bond sale produced results better than originally projected.  As shown in the “Expected” column of the table below, the RD anticipated selling the bonds last year at a rate of 4%.  Based on an average assessment of $1,200 per home per year, the District projected to sell $23,310,000 of total bonds.  After, deducting the costs to issue the bonds, the proceeds were estimated at $21,162,568 to be used to purchase the Recreational Facilities and to provide a renewal/rehab fund of $3,187,568.

The column labeled “Final” in the table shows the results of the bond sale.  The District was able to obtain insurance for the bonds which supported a successful competitive bond sale at an interest rate of 3.3%.  As a result, the supportable, bond size based on the adopted average assessment level of $1,200 per home per year, increased to $24,000,000.  After deducting the costs to issue the bonds, the sale generated proceeds of $20,811,234 for an increase of $648,666.  The District also obtained a discount of $475,000 on the purchase price of the recreation facilities.  This resulted in an increase from the Expected Rehab/Renewal fund of $3,187,568 to $4,311,234 for a total increase of $1,123,666.

Furthermore, the annual debt service for the Series 2019 Bonds is $71,188 lower than adopted assessment level which provides a benefit totaling $1,342,727 measured on a present value basis over the 30-year term of the bonds.  In Summary, the sale of the Series 2019 Bonds provides $2,466,393 in additional financial benefits compared to the Expected results.

Category Expected Final Change
 Total Bonds  $23,310,000  $24,000,000  $690,000
 Rate  4.0%  3.3%  -0.7%
 Term  30  30  
 Dated Date  12/30/2018  11/21/2019  
 Total Proceeds  $20,162,568  $20,811,234  $648,666
 Purchase Price  $16,975,000  $16,500,000  -$475,000
 Rehab/Renew  $3,187,568  $4,311,234  $1,123,666
 Required Debt Service  $1,341,432  $1,270,244  -$71,188
 Present Value of Lower Debt Service      $1,342,727
 Total Change from Original      $2,466,393

The bond sale will:

  • Fund the acquisition of the Recreational Facilities
  • Provide a Rehab/Renewal fund of $4,311,234
  • Result in lower debt service payments with a present value of $1,342,727.

With lower debt service required on the Series 2019 Bonds, the Board can increase the Rehab/Renewal fund, lower the annual assessments, or some combination of the two.

Closing on the Bonds and on the Purchase of the Club, Recreational Faculties, and the Land

Now that the Series 2019 are sold, the District anticipates a pre-closing on the transaction, including the bond sale, purchase and sale agreement, management agreement and mutual cooperation agreement, along with all other documents, on November 21st or earlier with closing to follow promptly thereafter.

Closing Celebration on December 4, 2019 at about 4:00 PM EST

The District will celebrate the closing of the bonds and the purchase of the Recreational Facilities with a casual, celebratory, gathering immediately following the December 4th Recreation District Workshop at 4 pm in The Lakeside Room.

Upcoming Meetings

Workshop                       December 4   4:00 PM               Lakeside Room

Regular Meeting             December 13 1:00 PM              Card Room


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