SETON SCHOOLS 2024 - SUMMARY LETTER.PDF
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8687 East Via de Ventura, Suite 306 Scottsdale, Arizona 85258 www.mcida.com September 9, 2024 To: Board of Supervisors Board of Directors Maricopa County, Arizona The Industrial Development Authority of the County of Maricopa Re: Not to Exceed $18,000,000 The Industrial Development Authority of the County of Maricopa Education Tax-Exempt Revenue Bond (Seton High School Project), Series 2024 Ladies and Gentlemen: At the meeting of the Board of Directors (the “Board”) of The Industrial Development Authority of the County of Maricopa (the “Authority”) on September 17, 2024, the Board will be asked to grant final approval and adopt a resolution authorizing the issuance and sale of the Bond described above (the “Bonds”). This letter provides a summary of the proposed financing. AUTHORITY The Authority is an Arizona nonprofit corporation designated by law as a political subdivision of the State of Arizona. The Authority was formed with the permission of Maricopa County, Arizona (“Maricopa County”), and incorporated under and pursuant to the Arizona Industrial Development Financing Act, Title 35, Chapter 5, Arizona Revised Statutes, as amended (the “Act”). APPLICANT/BORROWER The Applicant/Borrower, Seton Roman Catholic High School Chandler (the “Borrower”), is an Arizona nonprofit corporation and an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”). The Borrower operates a college preparatory high school and has 560 students enrolled. The Borrower has been serving Arizona students since 1954. PROJECT The Borrower will use the proceeds of the Bonds to pay a portion of the costs (1) to currently refund and refinance all or a portion of a taxable loan to the Borrower the proceeds of which were used to refinance the cost of acquiring, constructing, improving, and equipping a 55,000 square foot building for classrooms and related infrastructure located on the Borrower’s campus at 1150 N. Dobson Road, Chandler, Arizona 85224 (the “Property”); and (2) to finance certain costs of acquiring, constructing, improving, and equipping the renovation of the boys and girls locker rooms and the construction of a new event center to be located on the Property, including reimbursement of certain costs (collectively, the “Project”); and (3) to pay the costs of issuing the Bonds. The Project is in Supervisorial District No. 1. Board of Supervisors Board of Directors September 9, 2024 Page 2 NOTIFICATION TO ARIZONA ATTORNEY GENERAL As required by the provisions of Arizona Revised Statutes, Section 35-721.F, the Authority will notify the Arizona Attorney General of its intention to issue the Bonds. TAX EXEMPT FINANCING Pursuant to Section 147(f) of the Internal Revenue Code of 1986, as amended (the “Code”), the Maricopa County Board of Supervisors must approve the issuance of the Bonds after a public hearing following reasonable public notice. A representative of the Authority conducted a public hearing regarding issuance of the Bonds on August 12, 2024. On or prior to closing, the Authority will receive an opinion from, as bond counsel, to the effect that interest on any tax-exempt series of the Bonds will be exempt from federal and State income taxes. FINANCING PARTICIPANTS The major participants in the financing are as follows: Authority: The Industrial Development Authority of the County of Maricopa Authority Counsel: General Counsel Bond Counsel: Croke Fairchild Duarte & Beres Applicant/Borrower: Seton Roman Catholic High School Chandler Applicant/Borrower Counsel: General Counsel, Diocese of Phoenix Municipal Advisor: Colorado Financial Service Corp. Lender: Zions Bancorporation, N.A., dba National Bank of Arizona Lender’s Counsel: Sherman & Howard LLC PRINCIPAL FINANCING DOCUMENTS Document Parties Financing Agreement Authority and Borrower Promissory Note Borrower Deed of Trust, with Assignment of Leases and Rents, Security Agreement and Fixture Filing Borrower Tax Agreement Authority and Borrower Board of Supervisors Board of Directors September 9, 2024 Page 3 PLAN OF FINANCING The Authority will issue the Bonds under and pursuant to the terms and provisions of the Financing Agreement in one or more tax-exempt or taxable series in the aggregate principal amount of not to exceed $18,000,000 and will loan the proceeds to the Borrower pursuant thereto. The Borrower will be obligated to make loan repayments in amounts and at such times as required to pay principal and interest on the Bonds on their due dates under the Promissory Note. The obligations of the Borrower to make payments under the Financing Agreement will be secured by the Deed of Trust that will encumber the Project. The Bonds will be purchased by National Bank of Arizona in a private placement. The Bonds will not receive a rating from any rating agency. Finally, a tax certificate and agreement will be executed by the Authority and Borrower to evidence various representations and agreements aimed at establishing and preserving the tax-exempt status of the Bonds. FINAL APPROVAL At its meeting on September 17, 2024, the Authority Board will be asked to grant final approval and adopt a resolution authorizing the issuance and sale of the Bonds and related matters. BOARD OF SUPERVISORS APPROVAL Under the provisions of A.R.S. § 35-721.B., the Bonds to be issued by the Authority require the approval of the Maricopa County Board of Supervisors. The Maricopa County Board of Supervisors is being requested, at its meeting on September 25, 2024, to act as required by law to adopt a resolution approving the issuance of the Bonds under the Act. Under the provisions of the Act, specifically A.R.S. § 35-742, Maricopa County is not in any event liable for the payment of principal or interest on any bonds, notes or other obligations issued by the Authority or for the performance of any pledge, mortgage, obligation or agreement of any kind undertaken by the Authority, and none of the bonds, notes or other obligations, or any of its obligations thereunder, shall be construed to constitute an indebtedness of Maricopa County within the meaning of any constitutional or statutory provision. LEGAL COUNSEL RECOMMENDATION General Counsel to the Authority has reviewed drafts of the principal financing documents and, based upon her review of such and her review of the proceedings of the Authority to date relating to the proposed issuance of the Bonds, she believes the principal financing documents are now in substantially final form, adequately meet the requirements of the Act, and are in both form and substance acceptable for the Authority Board to act upon, and that the Resolution of the Authority Board authorizing the issuance and sale of the Bonds and related matters and the Resolution of the Maricopa County Board of Supervisors approving the Bonds to be issued and related matters, are in form and substance acceptable for adoption.