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Special Meeting 9-05-12
Agenda Item #31


Title
FM3: Tax Anticipation Notes

Description
  • The resolution authorizes the issuance of the 2012 TAN.
  • The Tax Anticipation Note, or TAN, is a short term financing instrument used to alleviate cash shortfalls in the general fund each year.  Current estimates show that additional cash will be required for the Operating Fund in November 2012.
  • The Ad Valorem millage levy provides the majority of the revenues for the School District, especially in the general fund.  As the first receipt of property taxes is expected in late November, it is necessary to borrow money for cash flow purposes until the tax revenues are received.
  • Based on the District's cash needs, the District plans to issue $115 million in Tax Anticipation Notes (TANs).
  • The TAN issuance in 2011 was also for $115 million.
  • The sale is tentatively planned for September 19, 2012 from 9 am to 11 am in the Board Room.  Students from the Finance Academies will be invited to participate.
  • The transaction is planned to closed on or about September 27, 2012 and will mature no later than February 1, 2013.
  • The Finance Committee reviewed and approved the transaction at their meeting on August 31, 2012.  A draft of the minutes as well as the video recording are available on the Finance Committee website:  http://www.palmbeachschools.org/treasury/FinanceCommittee.asp

 



Recommendation
I recommend the School Board approve the Resolution authorizing the issuance of Tax Anticipation Notes, Series 2012 and authorize the Chairman and Superintendent to sign the necessary documents.

My Contact

Michael J. Burke (Mike.Burke@palmbeachschools.org)

Leanne Evans (Leanne.Evans@palmbeachschools.org)

 



Financial Impact
The proceeds of this financing transaction will be used to meet the cash flow needs of the general fund.  Costs associated with the issuance of this debt instrument are estimated to be $76,000.


Attachment:  2012 TAN Resolution.pdf