Agenda - City of Dallas

KEY FOCUS AREA:
Economic Vibrancy
AGENDA ITEM # 53
AGENDA DATE: February 22, 2012
COUNCIL DISTRICT(S):
DEPARTMENT:
All
City Controller
CMO: Jeanne Chipperfield, 670-7804
MAPSCO:
SUBJECT
N/A
________________________________________________________________
Authorize (1) establishment of a non-profit corporation, the City of Dallas Education
Finance Corporation, for the purpose of financing or refinancing of educational facilities
and/or housing facilities incidental to education facilities; (2) approval of the
Corporation's certificate of formation and bylaws; (3) appointment of the Corporation's
initial Board of Directors; (4) the Mayor to execute and deliver a certificate approving the
bonds to be issued for the benefit of Uplift Education, a Texas non-profit corporation,
and the facilities to be financed with the proceeds of the bonds for the purpose of
satisfying the requirements of Section 147(f) of the Internal Revenue Code of 1986, as
amended; and (5) the City Manager to file the Corporation's certificate of formation with
the Secretary of State - Financing: No cost consideration to the City
BACKGROUND
Uplift Education, a Texas non-profit corporation that currently operates nine charter
schools in the DFW Metroplex, has requested the City of Dallas create an Education
Finance Corporation's (“EFC”) in order to issue obligations (“bonds”) and loan the
proceeds to Uplift Education (“Uplift”) so it can expand its existing campuses and
develop additional schools. Uplift anticipates pursuing bond financing of approximately
$70-90 million for these purposes within Dallas and Fort Worth. Of the total amount to
be financed, approximately $36 million is expected to be used for projects within the
Dallas city limits. Further, Uplift’s finance plan includes approximately $15 million of
Qualified School Construction Bonds (“QSCBs”) necessitating the creation of an EFC.
In order to issue QSCBs, the user must have a jurisdictional nexus with the EFC – i.e.,
the user must be located within the legal boundaries of the “Sponsoring Entity” such as
the City of Dallas in this case. Otherwise, EFCs generally have statewide issuing
authority – i.e., an EFC created by the City of Houston could issue tax-exempt bonds for
a user in Dallas.