TITLE
Title
PUBLIC HEARING: APPROVAL OF $50,000,000 IN STUDENT HOUSING REVENUE BONDS (NCA&T UNIVERSITY FOUNDATION, LLC)
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SPONSOR
Sponsor
Robert A. Walsh, Attorney, Parker Poe
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BACKGROUND
Background
The Public Finance Authority (PFA) is a governmental unit of the State of Wisconsin created for the purpose of issuing tax-exempt and taxable conduit bonds for public and private entities nationwide. PFA is sponsored by the National Association of Counties, the National League of Cities, the Wisconsin Counties Association and the League of Wisconsin Municipalities. Any debt issued is not debt of the County or PFA, but rather is payable solely from debt service payments received from the borrowing entity.
PFA has been requested to issue student housing revenue bonds in an aggregate principal amount not to exceed $50,000,000 to the NCA&T University Foundation, LLC. The proceeds of the bonds will be used to: finance renovations and related capital improvements to student housing, the Alumni-Foundation Event Center and Childhood Development Laboratory; refinance prior bonds (North Carolina Capital Facilities Finance Agency's Student Housing Revenue Bonds Series 2004B and Series 2015A); fund a debt service reserve account for the benefit of the NCA&T University Foundation, LLC; and pay certain expenses incurred in connection with the authorization and issuance of the bonds. Please reference the following resolution for a full description of the projects to be financed or refinanced.
Federal law requires that tax exempt bonds issued to finance or, in certain circumstances, refinance facilities owned by nonprofit organizations be approved by the elected legislative body (or highest elected representative) of the governmental unit that has jurisdiction over the area in which the facility is to be located. Prior to this approval, Internal Revenue Code Section 147(f) required that a public hearing be held, at which hearing the public is given the opportunity to comment on the projects.
Because the proceeds of the bonds will be used to finance and refinance projects located in Guilford County, the Board of Commissioners is the appropriate governing body to approve the use of tax-exempt bonds to finance and refinance the projects, for the purposes of Section 147(f) of the Internal Revenue Code.
Neither the PFA, nor the County, will have any liability whatsoever for the payment of principal or interest on the bonds. The NCA&T University Foundation, LLC will be responsible for repayment of the bonds. The bonds will not be deemed to constitute a debt of the County or a pledge of the faith and credit of the County, and will not affect its debt ratios or legal debt limit. Because no taxes or other revenues of the County are pledged to pay these bonds, County staff have made no financial analysis of the bonds and the County has no responsibility, whatsoever.
The notice of public hearing was published on the Guilford County Electronic Legal notices website on January 29, 2025. The form of resolution to be adopted is listed below.
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RESOLUTION
Resolution
RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE COUNTY OF GUILFORD, NORTH CAROLINA, APPROVING THE ISSUANCE BY THE PUBLIC FINANCE AUTHORITY OF ITS STUDENT HOUSING REVENUE BONDS IN ONE OR MORE SERIES IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $50,000,000
WHEREAS, The NCA&T University Foundation, LLC, a limited liability company duly organized under the laws of the State of North Carolina (the “Borrower”), the sole member of which is The North Carolina A&T Real Estate Foundation, Inc., a North Carolina nonprofit corporation described in Section 501(c)(3) of the Code (the “Foundation”), has requested that the Public Finance Authority, a public authority existing under the laws of the State of Wisconsin (the “Authority”), issue its student housing revenue bonds (the “Bonds”), in one or more series in an aggregate principal amount not to exceed $50,000,000, to (a) finance renovations and related capital improvements to (i) student housing facilities known as Aggie Suites E & F and Pride Hall, (ii) the Alumni-Foundation Event Center, and (iii) the Child Development Laboratory (formerly the fitness facility), each located on the campus of North Carolina Agricultural and Technical State University (collectively, the “Projects”), (b) refinance existing debt of the Borrower that previously acquired, constructed and developed the Projects, including the North Carolina Capital Facilities Finance Agency’s Student Housing Revenue Bonds (The NCA&T University Foundation, LLC Project), Series 2004B and the North Carolina Capital Facilities Agency's Student Housing Revenue Refunding Bonds (The NCA&T University Foundation, LLC Project), Series 2015A (the “Prior Bonds”), (c) fund a debt service reserve account for the benefit of the owners of the Bonds, and (d) pay certain expenses incurred in connection with the authorization and issuance of the Bonds (collectively, the “Bond Project”);
WHEREAS, the Projects financed and refinanced by the Bonds include: the renovations and related capital improvements of (a) Aggie Suites E & F, an on-campus student housing complex, (b) Pride Hall, an on-campus student housing facility, (c) the Alumni-Foundation Event Center, an approximately 30,000 square foot event center, and (d) the Child Development Laboratory (formerly the fitness facility), an early childhood education facility on the North Carolina Agricultural and Technical State University (the “University”) campus;
WHEREAS, all of the facilities to be financed or refinanced with the proceeds of the Bonds are or will be owned and operated by the Borrower or the Foundation and are located on the campus of the University as follows: (a) Aggie Suites E & F at 100 and 102 North Booker Street, Greensboro, NC 27401, (b) Pride Hall at 414 North Benbow Road, Greensboro, NC 27401, (c) the Alumni-Foundation Event Center at 200 North Benbow Road, Greensboro, NC 27411, and (d) the Child Development Laboratory at 114 Luther Street, Greensboro, NC 27411;
WHEREAS, in connection with the financing, the Borrower intends to change its name to “Campus Real Estate Holding Corporation, LLC”, the sole member of which will remain the Foundation;
WHEREAS, pursuant to Section 147(f) of the Code, prior to their issuance, the Bonds are required to be approved by the “applicable elected representative” of a governmental unit having jurisdiction over the area in which the Projects are located, after a public hearing held following reasonable public notice;
WHEREAS, the Board is the “applicable elected representative” of the County for the Projects located within the County;
WHEREAS, the Borrower has requested that the Board approve the Authority’s issuance of the Bonds and the financing of the Projects located within the County in order to satisfy the requirements of Section 147(f) of the Code;
WHEREAS, pursuant to Section 66.0304(11)(a) of the Wisconsin Statutes, prior to their issuance, bonds issued by the Authority must be approved by the governing body or highest ranking executive or administrator of the political jurisdiction within whose boundaries the project is to be located;
WHEREAS, the Board, following notice duly given in the form attached hereto as Exhibit A (the “TEFRA Notice”), held a public hearing today regarding the Authority’s issuance of the Bonds and the financing of the Projects and now desires to approve the Authority’s issuance of the Bonds and the financing and refinancing of the Projects in accordance with the Code;
BE IT RESOLVED by the Board as follows:
Section 1. Pursuant to and in satisfaction of the requirements of Section 147(f) of the Code and in accordance with Section 66.0304(11)(a) of the Wisconsin Statutes, the Board hereby approves (a) the Authority’s issuance of the Bonds in an aggregate principal amount not to exceed $50,000,000 and (b) the financing and refinancing of the Projects located in the County.
Section 2. The County has no responsibility for the payment of the principal of or interest on the Bonds or for any costs incurred by the Borrower with respect to the Bonds or the Projects.
Section 3. This resolution is effective immediately on its passage.
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BUDGET IMPACT
Budget Impact
NO COUNTY FUNDS REQUIRED
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REQUESTED ACTION
Requested Action
Hold a public hearing on the proposed issuance of not to exceed $50,000,000 in student housing revenue bonds to be issued by the Public Finance Authority of Wisconsin for the following purposes: (a) to finance renovations and related capital improvements to the Aggie Suites E & F, an on-campus student housing complex, Pride Hall, an on-campus student housing facility, the Alumni-Foundation Event Center, an approximately 30,000 square foot event center, and (d) the Child Development Laboratory (formerly the fitness facility), an early childhood education facility on the North Carolina Agricultural and Technical State University (the “University”) campus; (b) to refinance prior bonds (North Carolina Capital Facilities Finance Agency's Student Housing Revenue Bonds Series 2004B and Series 2015A); (c) to fund a debt service reserve account for the benefit of the owners of the bonds the NCA&T University Foundation, LLC; and (d) to pay certain expenses incurred in connection with the authorization and issuance of the bonds. At the conclusion of the public hearing, the Board is requested to adopt the previously referenced resolution, which finds:
That the $50,000,000 in student housing revenue bonds do not constitute a debt of the County; nor require a tax levy or a pledge of the faith and credit of the County; nor will the bonds affect the County's debt ratios or legal debt limit; and
That the County has made no financial analysis of the bonds or projects financed; and approves, solely for the purpose of meeting the requirements of Section 147(f) of the Internal Revenue Code and in accordance with Section 66.0304(11)(a) of Wisconsin Statutes, the Public Finance Authority's issuance of student housing revenue bonds in an aggregate principal amount not to exceed $50,000,000 and the financing and refinancing of projects located in Guilford County for the benefit of the NCA&T University Foundation, LLC.
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