Duke University Health System (Durham) is in line to receive more than a half-billion dollars in financing after the Local Government Commission (LGC) approved bond issues in that amount at the LGC’s Tuesday, May 6, meeting.
The North Carolina Medical Care Commission, which finances construction projects for nonprofit and public hospitals, requested $540 million in conduit revenue bonds. That type of financial instrument allows the Medical Care Commission to loan proceeds of the bonds to Duke University Health System (DUHS). The system would use the money to refund/refinance prior bonds, reimburse itself for paying part of the cost to acquire, build and equip a new medical office building and supporting infrastructure on the system’s Cary campus. That campus will have a freestanding emergency department, ambulatory surgery center, specialty clinics and other medical facilities. DUHS facilities involved in the prior bond issues are Duke University Hospital, Duke Raleigh Hospital and Duke Regional Hospital.
The Medical Care Commission also received LGC approval to issue $50 million in conduit revenue bonds and loan the proceeds to Maryfield, Incorporated, (Guilford County) doing business as Pennybyrn at Maryfield. Proceeds could be used to refund prior bonds and to pay for mechanical system improvements, paving and roof projects, storage/maintenance building construction, vehicle acquisition and other work at the 173-bed independent living apartment campus.
State Treasurer Brad Briner chairs the LGC. The commission is staffed by the Department of State Treasurer (DST) and has a statutory duty to approve most debt issued by units of local government and public authorities in the state. The commission examines whether the amount of money units borrow is adequate and reasonable for proposed projects and confirms the governmental units can reasonably afford to repay the debt. It also monitors the financial well-being of more than 1,100 local government units.
Another big-ticket item on the agenda that received a thumbs up from LGC members was a request by the city of Charlotte (Mecklenburg County) to issue $330 million in revenue bonds. Bond proceeds would be used to refund a prior bond issue at a net present value savings estimated at $3.5 million, and to pay to acquire, rehabilitate and renovate, expand and build facilities at the airport. A fourth parallel runway with a taxiway system necessary to accommodate increasing flight traffic, expected to be completed in the fall of 2027, and upgrades to Concourse D at Charlotte Douglass International Airport would be undertaken. The airport is the seventh busiest worldwide for the number of arrivals and departures.
LGC members gave a green light to the Greenville Utilities Commission (Pitt County) to issue $70 million in revenue bonds for Combined Enterprise System projects. The work could include electrical transmission line and infrastructure upgrades, substation additions, a community solar system addition, sewer plant upgrades and sewer system extensions, liquified natural gas plant additions and upgrades, and property acquisitions. The Combined Enterprise System is managed by a government-owned utility providing residential and commercial services to Greenville and surrounding areas. The system encompasses water, wastewater, natural gas and electric utilities.
The Raleigh Housing Authority (Wake County) received authorization to issue a $43 million conduit revenue bond. Proceeds will be loaned to WCO Tryon, LP, a North Carolina limited partnership, to finance a portion of costs to acquire, build and equip a 220-unit low- and moderate-income, multifamily residential rental facility called Tryon Flats on Tryon Road.
LGC members approved $33.6 million in two-thirds general obligation bonds requested by Forsyth County. The bonds could fund capital maintenance repairs at various schools and parks. Proceeds also will pay for a portion of the costs to build a new Ashley Elementary School to replace the current building in Winston-Salem, which was erected in 1970. The bond proceeds could further be used for Forsyth Technical Community College roof replacements and other campus upgrades, work on the Law Enforcement Detention Center and two libraries. A two-thirds bond allows a local government to issue a general obligation bond without voter approval with a value up to two-thirds of the amount by which its outstanding general obligation debt was reduced in the preceding year.
Camden County’s request for a private sale of a $31 million general obligation bond anticipation note received a favorable vote. Proceeds will be used to pay for costs to build a new Camden County High School and Camden Early College High School. A bond anticipation note is issued with the understanding funds will be forthcoming to pay it off. The county anticipates receiving a loan commitment from the U.S. Department of Agriculture Rural Development division. The LGC previously approved $33 million in general obligation bonds for the project, and the state awarded a $62 million grant for the work.
The LGC gave its consent to Oak Island (Brunswick County) to issue $29.5 million in revenue bonds to refund prior bond issues for sewer work. The town expects an estimated $1.2 million of net present value savings as a result.
The city of Eden (Rockingham County) received the LGC’s stamp of approval for a $9 million State Revolving Fund loan to replace an aeration basin and perform other work in its wastewater treatment system. The existing basin — which is a large holding tank in which oxygen is introduced to help bacteria break down organic pollutants — is inefficient. The new basin would create energy savings and increase efficiency at significant savings.
In other action, the LGC approved applications from:
- Hendersonville (Henderson County), $4.5 million State Revolving Fund loan for water and sewer line replacement.
- Pasquotank County, $1 million financing arrangement to lease four transfer trucks to replace aged vehicles in its solid waste fleet, to haul its solid waste to Waverly, Va.
- Stanley (Gaston County), $637,519 for an installment purchase of a fire pumper truck with specialized aerial capabilities.
- Wilkesboro (Wilkes County), $594,703 for a lease agreement for 11 vehicles to replace aging fleet vehicles.
- Wilkesboro, $578,409 for a lease agreement for 13 vehicles.
- Norwood (Stanly County), $360,000 for a lease agreement for seven police vehicles.
- Lumberton (Robeson County), $100,000 loan from the N.C. Department of Environmental Quality to conduct a required inventory of water lines to determine if lead is present.