HomeMy WebLinkAboutCFW__DFW_-_55_and_56_SBOAug. 27, 2019DFW Bond Ordinance and PFIC Debt Project
222Interim financing program• Lowers interest rates saving money during construction• Periodically take-out interim financing with long-term debt• Requires 55thSBO to establish the programRecommend taxable commercial paper• CP obligations are sold at a fixed interest rate • Maturities of up to 270 days• Provides for self-liquidity• Requires 56thSBO for funding authorization• Expecting rating of A1/P1 Interim financing / commercial paper program56thSBO – Commercial Paper• Issue up to $750 million of taxable CP• Interest rates not to exceed the maximum allowed under state law• 7 year program 55thSBO – Parameters• Establish ability to use commercial paper as interim financing tool• Subordinate to other DFW bonds• Coverage ratio of 1.10x
3DFW has about $6.2 billion of debt outstanding, and about $500 million in annual debt service. PFIC net revenues are not a Gross Revenue of the Airport and not currently pledged to pay debt service. It is highly unlikely that the Airport would not be able to pay future debt service. However, this approval provides investors and rating agencies more clarity that the Airport would use the PFIC’s unencumbered cash, if necessary, to pay DFW’s debt service.Debt Service as an Approved PFIC ProjectRequest DFW Revenue bond debt as an approved PFIC project