DeKalb County: refunds eight bond series in less than five months, complete with rating upgrades.

• Author: Jaskulak, Stefan

It was August 1, 2013, and DeKalb County, Georgia, needed to refinance, or refund, eight series of bonds before December 31, the end of the county's fiscal year--a component of the county's 2013 budget assumptions. The county had less than five months to select underwriters and form syndicates, finalize its financial statements, obtain ratings, complete the financing documents and the preliminary official statements, market and sell the bonds, and validate and close.

Most of these steps are usually done in sequence, ensuring that the county leadership is ready to proceed to the next step in the event of delays or unforeseen circumstances. Following the traditional sequencing, however, would have taken the county well into the following fiscal year for just one bond issue. But the mandate was clear: Close on all eight before December 31.

DeKalb County had eight series of bonds eligible for refunding, each with significant savings potential:

* General Obligation Bond Series 1998, 2003A and 2003B

* DeKalb County Building Authority Bond Series 2003A

* Association of County Commissioners of Georgia (ACCG) Certificate of Participation Series 2003

* Fulton-DeKalb Hospital Authority Series 2003

* Water & Sewer Series 2003A and 2003B

Only the General Obligation and the Water & Sewer Bonds were issued directly by DeKalb County. The Building Authority, Fulton-DeKalb Hospital Authority, and the ACCG Certificate of Participation Bonds were issued by separate entities. While the county is responsible for the debt service, it did not issue these bonds directly, so approvals for refunding all of the bonds needed to be obtained from four separate boards.

TWO IMPORTANT DECISIONS

Two simple decisions made it possible for DeKalb County to achieve its goal: implementing a steering committee and collapsing the sequence of events.

Establishing a steering committee with weekly meetings should be the standard approach for any bond refunding, and this step is usually implemented in varying degrees. (For the GFOA's best practices, see Analyzing and Issuing Refunding Bonds at www.gfoa.org.) DeKalb County's steering committee was comprehensive and included the finance and legal departments, financial advisor, bond counsel, and disclosure counsel, as well as the senior managers of the syndicates, once selected, with their counsel. This lineup filled the conference room at every meeting, but it achieved the goals of direct communication, open discussion, quick decision...