The Crackerneck Creek TIF financing includes five outstanding debt issues.
Working together, the financing team has developed a long-term plan to make Crackerneck Creek related debt service payments. This can be accomplished by refunding the Series 2006B; 2013A; and 2013B bonds, and developing a TIF Sinking Fund Policy that appropriates revenues into a sinking fund. When the City's TIF projects reach the end of their life, the City portion of the increment will be deposited into a Sinking Fund in amounts – together with pledged project revenues – necessary to make debt service payments on TIF related obligations. The City will use this Fund to appropriate for Crackerneck Creek and other TIF district shortfalls. This approach provides for proactive, planned appropriates while giving the purchasers of City debt more confidence debt payments will be made.
The refunding debt will be a long-term obligation of the City and considered a debt security. The financing team has developed the Preliminary Official Statement (POS). The POS is the document used by the issuer to give information about the price of the bond, the maturity date, interest rate, and all other important information to potential buyers.
The City is responsible for including information within the POS that reasonable investors would consider to be important in making an investment decision. This information includes relevant financial and operating information as well as legal and tax considerations. The POS includes how the City plans to repay the debt.
As part of the transaction, the City will be making disclosers in compliance with the antifraud provisions of the Securities Act of 1933 and Rule 10b-5 of the Securities Act of 1934. Primary market disclosure practices for municipal securities have developed as a result of these antifraud provisions, federal regulation of broker-dealers through the Securities and Exchange Commission (SEC) Rule 15(c)2-12, and other regulations of market participants by the Municipal Securities Rulemaking Board (MSRB).
The governing body is urged to review the POS and be aware that Federal antifraud laws prohibit making material misstatements or omissions of material facts if those facts are necessary to avoid a misleading statement. If the City fails to comply with these disclosure requirements the City may be subject to regulatory actions and/or monetary fines.