$12M Awarded: TD Bank Takes the Helm of Mesa County’s Energy Project
Mesa County, Colorado has completed its competitive bidding process for tax-exempt lease purchase financing to support its Energy Improvement Project. The Facilities Department invited qualified companies to participate in this solicitation.
TD Bank has been selected as the awarded bidder for this project, thanks to its extensive experience in large-scale international project financing and its strong track record of innovative financial solutions.
The Benefits of Tax-Exempt Lease Purchase Financing for Mesa County Communities
In today’s unpredictable economic environment, it is essential for local agencies to utilize the most effective tools to obtain necessary financing. With shrinking budgets, meeting both immediate and long-term needs of local governments becomes increasingly challenging.
As a result, local agencies are exploring more flexible and efficient funding options. Tax-exempt lease-purchase financing is a strategy that local agencies utilize to optimize their time and resources.
For example, in a lease structure, a third party purchases the property and then leases it back to the local agency. The agency makes payments that cover both the principal and interest on the acquisition.
Once the lease terms are completely fulfilled, the local agency acquires the property free and clear of any restrictions, and without needing to make any additional residual value payment.
The key financial components of the lease, including the term length, interest rate, and prepayment conditions, are established through an agreement between the lender and the local agency. The interest rate is influenced by current market conditions and the creditworthiness of the local agency.
Although the lease term is typically limited by the expected useful life of the financed property, the restrictions on prepayment are negotiated between the agency and the lender.
Moreover, the project is expected to have a positive impact on the local economy. The construction and implementation phases will create jobs, providing employment opportunities for local residents.
Additionally, the improved infrastructure and energy efficiency can attract new businesses and investments to the area, stimulating economic growth.
Mesa County Advances Energy Efficiency with Tax-Exempt Lease-Purchase Financing
Mesa County is making strides toward enhancing energy efficiency and fiscal responsibility through a recent decision to modernize its utilities in County facilities.
During a public hearing on July 2, 2024, the County Commissioners approved an $11.5 million contract amendment with Schneider Electric.
To finance this ambitious project, the County will utilize a tax-exempt lease-purchase agreement, also approved during the hearing. The agreement will allow the County to secure up to $12 million, which will be paid off over a 20-year period.
Mesa County needs companies to provide tax-exempt lease purchase financing for its Energy Improvement Project to effectively manage the substantial financial requirements associated with this initiative.
Tax-exempt lease purchase financing offers a cost-effective solution by allowing the County to secure necessary funding with favorable tax-exempt conditions, which can result in lower interest rates compared to traditional financing methods.
This approach helps the County to spread out the financial impact over time, aligning with its budgetary constraints while advancing its energy efficiency and infrastructure goals.
By obtaining this financing, Mesa County aims to enhance its energy infrastructure, reduce operational costs, and achieve long-term sustainability objectives without incurring immediate large expenditures.
The Hot Race to Secure the Best Value: Evaluating Criteria
To ensure a successful outcome for the Mesa County Energy Improvement Project, respondents must meet specific qualification criteria. The proposals must clearly demonstrate the Offeror’s ability to provide the required services.
Prospective Offerors are expected to meet several minimal standards, including submitting the signed Solicitation Response Form and other required documents, demonstrating adequate financial resources, adhering to the proposed completion schedule, and maintaining a satisfactory record of performance, integrity, and ethics.
Besides, Offerors must be qualified to enter into a contract with the Owner.
The evaluation of proposals will focus on several key criteria: cost effectiveness and flexibility, interest rate lock period, qualifications and prior experience with Tax-Exempt Lease Purchase Financing, and ease of documentation.
The Owner seeks to maximize the value of public funds by selecting the most responsive, responsible, and best-value Offeror, considering overall quality, safety, service, innovation, and reliability, rather than simply choosing the lowest price.
The Owner reserves the right to reject any or all proposals, or portions thereof. An evaluation team will review all submissions to identify the proposal that best meets the project’s requirements and demonstrates the necessary integrity and reliability.
The top-rated Offerors may be invited for oral interviews and site visits to further assess their qualifications.
Negotiations will be conducted with the leading Offeror(s), and the final award decision will take into account all submitted information, selection criteria, oral presentations, and site visits.
The Board of County Commissioners may override the evaluation team’s decision, if necessary, in accordance with purchasing policy limits.
In the competitive bidding process for Mesa County’s Energy Improvement Project, four vendors emerged as finalists, each presenting strong proposals for tax-exempt lease purchase financing.
Among the contenders were The Huntington National Bank, TD Bank, Webster Bank, and BofA Global Leasing. Each institution presented compelling proposals, showcasing their strengths and commitment to delivering value.
The Huntington National Bank, located at 525 Vine St, Cincinnati, Ohio, offered a robust financing solution Along with that, TD Bank, based at 1006 Astoria Blvd, Cherry Hill, New Jersey, distinguished itself with a comprehensive approach and a strong commitment to customer service.
Webster Bank, situated at 999 Corporate Drive, Suite 100, Ladera Ranch, California, presented a solid proposal focused on competitive pricing and innovative financing options.
And finally, BofA Global Leasing, located at 312 Walnut St, Ste 2200, Cincinnati, Ohio, also showcased their extensive resources and experience in large-scale financing projects.
TD Bank Selected as the Winner for Mesa County’s Energy Improvement Project
After a meticulous evaluation process, the hot race to secure the financing for Mesa County’s Energy Improvement Project concluded with TD Bank as the chosen winner.
TD Bank’s roots trace back to 1855 with the founding of The Bank of Toronto by a group of millers and merchants, establishing itself as a cornerstone in Canada’s emerging grain industry.
Over the years, TD Bank, originally known as The Bank of Toronto and later The Dominion Bank, has expanded its financial services and expertise.
The Dominion Bank, chartered in 1869, played an important role in financing Canada’s development and extended its reach to central Canada by opening branches as far west as Winnipeg and British Columbia.
Throughout the 20th century, TD Bank ventured into new business lines, including large international project financing, mutual funds, and the VISA card (Chargex). The iconic Toronto-Dominion Tower, completed in 1967, symbolized its global vision and modernization.
In the 1980s, TD Bank continued to innovate with moves into international money market trading, commercial real estate developments like the Toronto Eaton Centre, and discount brokerage services through Green Line Investor Services.
By establishing Toronto Dominion Securities Inc. in 1987, TD Bank further solidified its commitment to providing comprehensive corporate, treasury, and investment banking services.
This rich legacy of innovation and extensive experience makes TD Bank the ideal partner for Mesa County’s ambitious energy project.
How TD Bank Will Serve the Mesa County Energy Improvement Project
TD Bank is poised to effectively serve the Mesa County Energy Improvement Project through a tailored tax-exempt lease purchase financing solution.
As the selected Lessor, TD Bank will establish a Tax-Exempt Lease Purchase Agreement with Mesa County, ensuring compliance with Colorado statutes and incorporating all necessary exhibits for clarity and transparency.
This agreement will secure the financing by the County’s obligation to make lease payments, which are subject to annual appropriation.
Throughout the financing term, TD Bank will hold title to the energy-saving equipment installed by the Energy Service Company (ESCO), allowing for its salvage without damage to County facilities.
TD Bank will offer a fixed interest rate for the entire term of the financing, providing Mesa County with predictable budgeting.
The payment structure will adhere strictly to Colorado statutes, utilizing the guidelines provided in the financing bid package to ensure compliance and avoid disqualification.
To enhance flexibility, the final agreement will include prepayment provisions that can be tailored to a mutually agreed-upon schedule.
Additionally, TD Bank will retain the right to assign its rights to receive lease payments and its security interest in the equipment, but only with the advance written consent of Mesa County, ensuring that the County’s rights regarding prepayment are protected.
TD Bank will provide a comprehensive breakdown of all costs associated with the transaction, including commitment fees, legal counsel, and trustee fees, ensuring that Mesa County is fully aware of its financial obligations.
Lastly, TD Bank will clearly outline any requirements imposed on the ESCO as a result of this financing arrangement, ensuring a seamless integration of all parties involved.
