MINUTES OF

THE INDIANAPOLIS LOCAL PUBLIC IMPROVEMENT BOND BANK

 

Minutes of the Special Meeting of the Board of Directors

 

June 29, 2009

 

 

MEMBERS PRESENT:           Briane House                                       

            Sahara Williams

                                               Jim Carr

                                               Justin Christian

 

MEMBERS ABSENT:           Fred Miller

                                              

                                                BOND BANK PRESENT:

                                    Kevin Taylor

                                    Deron Kintner

                                    Jacqui Coe

                                    Laurie Canatsey

 

Isaiah Kuch                          

Kyle Willis

Monica Durrett

Dario Requiz

 

                                   

                                                     OTHERS PRESENT:

                                               

          Sharon Karst, Bank NY Mellon              John Kirkwood, Kreig DeVault                                                             Kim Wilson, UMB Bank                                  Molly Williams, IDI                                                                  Brenda Horn, Ice Miller, LLP                           Julie Bolling, Kreig DeVault

          Hans Steck, Bingham McHale                            Bob Kocher, Bank of NY Mellon

          Brian Shaw, Hilliard Lyons                                  Jay Ryals, Fifth Third Bank

          Steve Meno, Fifth Third Bank                             Clayton Graham, Graham & Hurley

          Curt Fritsch, CRF Group                                    Maria Quintana, Chase

          Eric Green, Backstrom, McCarley& Berry          Terry Leffew, Raymond James

          Jim Merten, City Securities                                 Diana Hamilton, Sycamore Advisors

          Dennis Otten, Bose, McKinney & Evans Eric Rockhold, J.P. Morgan

          Emily Loehr, Sycamore Advisors                       

                                               


            A Special Meeting of the Indianapolis Local Public Improvement Bond Bank (“Bond Bank”) convened at 12:00 noon, Monday, June 29, 2009 in the City-County Building, 200 East Washington Street, Suite 107, Indianapolis, Indiana, pursuant to notice given in accordance with IC 5-14-1.5. Mr. House called the meeting to order after determining that a quorum was present.

           

             Mr. House first asked Mr. Kintner to give a brief summary on Resolution No. 9 – Waterworks Bond Anticipation Note. Mr. Kintner stated that since the IURC did not issue its order for the rate increase on June 24th as anticipated, DEPFA, as the liquidity provider for the Waterworks variable-rate bonds, was requiring a collateral deposit for the approximately $20 million payment due to them on July 1, 2009. The Bond Bank contacted J.P. Morgan Securities to look at some options. J.P. Morgan provided a proposal that would loan the Bond Bank the money for the July 1st payment in the form of a bond anticipation note. The Bond Bank would then pay back the loan from the final bond issue. Mr. Kintner introduced Eric Rockhold of J.P. Morgan and thanked him for all of his hard work. He then stated that the Bond Bank is working with DEPFA on how to best handle the payment since the Bond Bank is in the process of refunding the Bank Bonds. He stated that J.P. Morgan will loan the Bond Bank $35 million upon the approval from the Board, and the Bond Bank will deposit the proceeds with DEPFA to cover both the January 1 and July 1 payments.

 

            Mr. Carr asked what the interest rate will be. Mr. Kintner stated that it will be 7% through August 15, 2009 and thereafter it would increase to 8.5% through October 31, 2009. Mr. House voiced a concern over the IURC keeping its schedule to issue its order regarding the increase as indicated. Mr. Kintner stated that there is more flexibility since the Bond Bank now has the bond anticipation note from J.P. Morgan.

 

            Mr. House asked for a motion to approve Resolution No.9. Mr. Christian made the motion to approve, seconded by Ms. Williams. All voted in favor and the motion passed.

 

            Mr. Kintner next discussed Resolution No. 10 – Regions Bank Line-of-Credit   Extension. He stated that the Bond Bank is asking for approval for an extension of the $15 million line-of-credit until March 31, 2010. The proceeds from the line-of-credit were originally used as collateral for the January 1, 2009 payment to DEPFA. However, the J.P. Morgan BAN will now be used to provide that collateral. He then stated that if the Waterworks Department should experience a cash flow shortfall issue in the second-half of 2009, the Bond Bank could use the line-of-credit to assist the Waterworks Department. He stated that the interest rate is 5%, through March 31, 2010. Ms. Williams asked if it was appropriate for the Bond Bank to take out a line-of-credit. Mr. Kintner stated that the Bond Bank was in a better position in such matters due to its relationships with banks. She then asked about risk and if there would be an underlying Q.E. agreement. Mr. Kintner stated that the risk was minimal and there would be an agreement if the Bond Bank would partake in any borrowing. Mr. Taylor thanked Regions for their flexibility and professionalism in helping the Bond Bank and Waterworks at a critical time.

 

            Mr. House asked for a motion to approve Resolution No. 10. Ms. Williams made the motion to approve, seconded by Mr. Carr. All voted in favor and the motion passed.              

 

            There being no further questions, Mr. House for a motion to adjourn. Mr. Carr made the motion to adjourn, seconded by Ms. Williams. All voted in favor and the motion passed. The meeting was adjourned at 12:15p.m.