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HomeMy WebLinkAbout(0005) IR 22-050 - DFW Internation Airport Bond Financing PackageINFORMAL REPORT TO CITY COUNCIL MEMBERS No. 22-050 To the Mayor and Members of the City Council March 22, 2022 �d Page 1 of 1 �`o s SUBJECT: DALLAS FORT WORTH INTERNATIONAL AIRPORT BOND kr ye'?OL FINANCING PACKAGE Dallas Fort Worth International Airport (DFW) is seeking approval of two new bond ordinances from the Owner Cities of Dallas and Fort Worth to refinance some debt, and position DFW to fund certain capital projects. DFW expects a robust return of travel this summer and plans to take action in preparation for increased customer loads. The Board is seeking authority to: (i) refund existing bonds, Subordinate Lien Bonds and outstanding commercial paper; and (ii) issue new money bonds to finance Terminal C and other aging infrastructure, assuming rates are good as shown in the table below. Action Item Amount Summar, 63rd Supplemental $3.65 This is DFW's annual debt financing request for the Bond Ordinance billion following items: (1) refund bond series 2013B, 2013E, 2014A, 2014D and 2014E, Subordinate Lien Drawdown Bonds, outstanding commercial paper and issue $1 billion of new money bonds for a total of $1.96 billion; (2) potentially refund bond series 2013D, 2013F, 2013G and 2014C totaling $690 million, assuming market conditions are favorable; and (3) issue up to an addition $1 billion in new money bonds, assuming market conditions are favorable. 64t' Supplemental $750 This is the annual request to provide DFW with the ability Bond Ordinances million to refund commercial paper with long term bonds. The program approved by the Owner Cities in 2019 requires the Airport to request this authorization annually. These items were briefed to the Airport Board on February 3, 2022. The Airport Board approved the two ordinances at its March 3, 2022 meeting. The Owner City Approval schedule is below: March 22 — Fort Worth City Council Work Session Briefing (via Informal Report) March 28 — Briefing to the Government Performance and Financial Management Committee of the Dallas City Council March 29 — Fort Worth City Council Agenda Meeting April 13 — Dallas City Council Agenda Meeting For more information, please contact John Samford, Fort Worth City Treasurer, at 817-392-2318 or Chris Poinsatte, DFW Airport Executive Vice President and Chief Financial Officer at 972-973-5210 or via email at capoinsatte(a-)dfwairport.com David Cooke City Manager ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS DFW International Airport 63rd and 64th Supplemental Bond Ordhan March 22, 2022 Fort Worth City Council MrrlA/ yr vv Capital Improvement Program — FY22 to FY27 DFW's Capital Program is currently projected at $5.9 billion through FY 2027. $1,600 $1,200 $132 $90 o $800 � $80 $470 $110 `,� ## 414 $414 $0 VT FY22 FY23 u , Central Terminal Area (CTA) Expansion $141 $93 $62 $535 FY24 FY25 Infrastructure Capital Program $50 $46 $247 M. FY26 ■ Commercial Development S�1 $264 $239 FY27 Other 11�1A/ 2 Source: DFW Finance and Planning Departments, internal records LmW V V Central Terminal Area Expansion Program Currently programmed at $2.3 billion through FY 2027. A: j High C dates U1 CT,AEKpensivnTermina,l C Pier i Terminal E Gate Swap ® CTAExpi rnsion Terminal A Pier IWlo,IE073 © ,airfield Ramp Efficiencies Terminal C Renovations ARFIELR EFFICIENCY NOT 4� B Is `OR Utilidor (utililyCorridor & BoiiQFHouse) Terminal C Ca rage and Roadways TURNM 0 CTAEx:pansion P M 0 Building MID & G-EI la,...- I I I^ rup I I L 9 UA I �I! f 1 i s GY.UkCY � YEYI.MKAL E GAIV-SWAFI MOY VISIkE FOR 1"1 \ A / V YY 3 Sixty -Third Supplemental Bond Ordinance PURPOSE Approve the Sixty -Third Supplemental Bond Ordinance allowing the Authorized Officer to issue up to $3.65 billion of bonds and take other necessary actions for one year. DESCRIPTION • Purpose is to refund Series 2013B, 2013E, 2014A, 2014D, and 2014E bonds, Subordinate Lien Drawdown Bonds and outstanding Commercial Paper Notes • Total estimated savings is in excess of $179 million, over 20% • Potential advanced refundings of Series 2013D, 2013F, 2013G and 2014C bonds • Potential issuance of up to $2 billion of new money bonds, possibly in several different transactions, to lock in lower interest rates if determined beneficial by the Airport 1"1C\ A / Vr r♦ Sixty -Third Supplemental Bond Ordinance Total request of approximately $960 million, plus additional authority of $2.69 billion, assuming market conditions are favorable Tax -Exempt Tax -Exempt Taxable/Tax-Exempt Refund non-AMT Bonds Callable 11 /22 Advance Refund AMT Bonds Callable 11 /23 Refund Subordinate Lien Bonds Advance Refund AMT Bonds Callable (various) Fund capital projects Fund capital projects Fund capital projects $1,000M* * Assuming market conditions are favorable ^�X A 5 E. r r Sixty- Fourth Supplemental Bond Ordinance PURPOSE Approve the Sixty -Fourth Supplemental Bond Ordinance allowing the Authorized Officer to issue up to $750 million of refunding bonds and take other necessary actions. DESCRIPTION • Annual request per DFW's debt policy. • Section 8.2.2.7, "Annually, the Airport will request standby authorization from the Owner Cities to issue refunding bonds in an amount sufficient to refund all anticipated outstanding self -liquidity VRDs" (Variable Rate Debt, which includes commercial paper) • Provide for issuance of multiple series of bonds in an amount not to exceed $750 million over a one-year period 1"1 \ A / V YY Academy Securities* Bank of America Securities Barclays Cabrera Capital* Citigroup Goldman Sachs Jefferies JP Morgan Loop Capital Markets* Morgan Stanley Piper Sandler *MWDVBE qualified firm Underwriting Pool Ramirez & Co* Raymond James RBC Capital Rice Financial* Siebert Williams Shank* Stern Brothers* Em Wells Fargo 11r\A/ L.J r Y Y HYATT ;eei OF ele !. _ �..■,-- -- I - Financing Team Co -Financial Advisors Hilltop Securities Estrada Hinojosa Bond Counsel McCall, Parkhurst & Horton, LLP West and Associates, LLP Co -Disclosure Counsel Bracewell, LLP Hardwick Law Firm, LLC s ,a Co -Underwriters' Counsel Kelly Hart & Hallman LLP Escamilla Poneck, LLP r%r lA/ yr vv