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Miscellaneous InformationPFM WHY HIRE A FINANCIAL ADVISOR? by Samuel P. Katz Managing Director Public Financial Management, Inc. PFM Introduction Several years ago, before the general acceptance by state and municipal bond issuers of financial advisors that exists today, the response to the question why use a financial advisor" was a more difficult one to fashion than perhaps it is today. In the mid— 1970's the best arguments for using an advisor were the ones developed by the sellers of this service, the banks and independent firms who were in this business. Better and more sophisticated competitive bidding techniques, more complete disclosure and an experienced and professional guide to bond issuing were the principal calling cards of the trade. Today, the reasons for retaining a municipal financial advisor are more likely to emanate from the trends and conditions characterizing the tax exempt market than from a particular argument which the vendors can raise. Interest rate volatility coupled with a major shift in the perception of this market as "risk —free", shifts away from competitive sales and general obligation banked financing to negotiated issues supported by more limited tax or project derived revenue streams, increasing regulatory constraints imposed by Congress, the U. S. Treasury Department and, in many cases, the states, proliferation of financing alternatives resulting from an increasing sophistication of the municipal bond market, segmentation of markets creating new opportunities and increasing risks for issuers, and tougher and more selective credit decisions by bond rating services and investors, are but a few of the trends that issuers of securities are confronted with as they develop and implement their respective debt management policies. Ten years ago the argument advanced by some that the advice one needed could be readily delivered by the underwriter is one that is rarely made today. Events and education have broadened the public sector's acceptance of financial advisor as well as a recognition that a separation between underwriter and advisor is generally a prudent strategy. Despite the widespread acceptance of the advisor's role in debt management the question "why hire a financial advisor" is an interesting one particularly in light of current capital market characteristics and is an appropriate starting place for GFOA's examination of this important service. • Why Use a Financial Advisor In today's complex environment of municipal finance, the chief financial officers, management officials and the elected or appointed decision makers of state and local government are confronted with a myriad of financial choices that ultimately affect their respective constituencies in ways that often have a profound economic, social or political impact. In the give and take of the policy making process there are normally a broad array of interests represented in the process each with their own agenda. The same is true in the financial markets where rating services, underwriters and investors make decisions reflective of their own standards, market expectations and investment preferences. In respect to capital financing issues, the balancing of these disparate interests, those of imparted local constituencies and the PFM requirements of investors and their intermediaries, is a challenge in the finance department of any governmental organization. It is in this context and in respect to negotiating these interests that a financial advisor can often make a meaningful contribution to the financial policy making process. A number of other important reasons exist for retaining the services of a municipal financial advisor, each of which is briefly discussed below. • Capital Markets: Experience and Expertise Most issuers of municipal securities are in the market no more frequently than once a year, some even less often. Larger communities and levels of government may access the markets for general obligation and revenue bond purposes more frequently. In both situations and in most cases, the cost and efficacy of hiring full time staff to monitor the tax-exempt markets mitigates against this route. The frequency of activity, the complexity and rapidity of market changes, and the general non-competitive nature of public sector salaries for this type of expertise have led most public units to contract for this help. Even in many of the most financially sophisticated communities (New York, Chicago, Los Angeles, for instance) the existence of a debt management officer, staff or coordinating (multi -department) committee, has not precluded the use of an outside financial advisor. For the smaller issuers of competitively sold debt, the financial advisor is generally responsible for all transaction execution procedures including structuring maturities, drafting the official statement and notice of sale, providing documentation to the rating agencies, and analyzing bid results to determine the winning bid. For both large and small issuers, the advisor can also be expected to provide advice about market conditions and trends, interest rate implications and on the most appropriate timing for the bond sale. Notwithstanding all the modern public finance innovations which make the finance officer's job more interesting and difficult, the most important reason for hiring a financial advisor has remained constant over the years and that is assure that the capital market experience and technical expertise residing in a financial institution or professional firm is available to provide advice, assistance and staff support to the debt management process. • Independent Perspective Of increasing importance in the consideration of retaining a financial advisor is the desire to assure advice and input to the financing process, that is, independent from that provided by the investment or commercial banking organizations which might underwrite and distribute the securities. The impetus for this separation of functions grew out of the 1975 New York City fiscal crisis after which Federal investigators found that conflicts of interest resulted from having underwriters also serving as the city's financial advisor. The Municipal Securities Rulemaking Board (MSRB) in its rule G-23 has recognized these potential conflicts though its regulations and enforcement procedures are relatively toothless. PFM However, MSRB policy has heightened issuer awareness of the advantage of making the advisory function independent from the underwriting function. The argument for using independent (i.e. non -underwriting) firms as opposed to investment or commercial bankers seeking to provide this service is somewhat more controversial. On the one hand it is argued that without a daily capital market presence (such as a bond trading debt) an independent cannot hope to stay current on the markets and that the bigger institutions assure their advisory clients a deeper pool of resources from which to draw. On the other hand, the economics of banking versus advising provide strong impetus for the notion that bankers seeking to advise ultimately will try to shift to an underwriting position to maximize profits and that such profitability variations inhibit a broad resource commitment. Moreover, it is extremely difficult to argue that any dealer bank or securities firm can be truly independent of other dealers since they are all so relatively dependent upon each other in the underwriting and distribution business. Irrespective of which side one takes on this question, it is now widely recognized that using a financial advisor to review and independently evaluate the proposals and recommendations of underwriters is a desirable posture for finance officers to be in. • Specialized Skills and Technical Resources New financing methods developed in response to changing investor preferences, regulatory constraints and the overwhelming need for infrastructure capital has spawned a highly specialized oriented public finance industry. State and local government finance officers, even if they hire capable in-house debt management staff, still need to retain outside advisors to assist in the more complex and specialized financial transactions and in the planning and analysis that precedes the implementation of such transactions. Advance refundings and other types of debt restructuring require highly sophisticated mathematical and computing power which was once solely domiciled in Wall Street firms. Today, however, major financial advisory organizations possess these skills and technical resources and can provide an issuer with a high level of analysis and alternative financing approaches prior to making a decision to proceed with a bond issue and engaging a banking team. In addition, as public agencies continue to shift their dependence for capital dollars from federal to local and in some cases private sources, the sophistication in project finance, tax oriented private finance and structuring new types of municipal credits are areas generally beyond the staff capability of most entities. The conditions which have made these new financing approaches so prominent have also helped to broaden the number and scope of players with whom the finance officer must now interact. Where once his or her principal focus was rating services and bankers, the capital investment process may now require the finance officer to negotiate with vendors of resource recovery technologies, advisors and bankers to foreign governments looking to assist foreign companies in arranging expanded credits PFM for equipment, or with developers and their financial consultants seeking to merge investor equity, IDB's with a UDAG grant for a downtown shopping center. To be in a position to deal with this array of investment partners, financial advisors with experience in these types of specialized transactions are normally retained and charged with responsibilities for measuring the fiscal (budgetary) impact of various negotiating options as well as to assist directly in such negotiations and in the eventual execution of a bond transaction. New forms of financings, such as variable rate demand bonds, have introduced a wide range of financial agreements to the municipal bond market. In addition to bond resolutions or trust indentures official statements and bond purchase agreements, issuers may have to execute letters of credit, bank reimbursement and remarketing agency agreement, each of which require time and experience to assure that local public interests are protected and appropriate financial controls are exercised. • Transaction Management and Cost Reduction Another area where the use of a financial advisor can be highly valuable is in the area of "deal control". Bond issues have the tendency to become both capital and time intensive, that is they can be very fee heavy and take an inordinate amount of management time away from the day to day business of running the government. On both counts the financial advisor has an important role to play. First as the "point man" for the issuer, the financial advisor should be the manager of the issuer's agenda in the financing (just as in a negotiated sale, the investment banker must deliver a deal which his sales force can sell to investors). The advisor must help to define and articulate the objectives which the issuer expects to achieve and assure that during the financing process, these objectives do not become subordinate to those of other parties. These objectives may relate to the level of user fees which capital structure will require, the bond ratings to be sought, the timing of delivery of funds, the covenants which the issuer is prepared to make and the flexibility to pursue other transactions or issue additional debt, among others. In these and other financing issues, the issuer really needs to have a clear focus prior to commencing the process, a position which can be best achieved with the help of an outside consultant, so as to avoid constantly having to react to underwriter demands. Implicit in bringing a prepared and well informed issuer to the table, is the need to conclude the transaction and the numerous steps along the way in a timely and efficient manner. To the degree that deadlines are permitted to slip and that excessive time is spent debating major as well as miner points, the financing process will undoubtedly get more expensive. No where is the expression "time is money" more apropos than in the financial community. Of equal significance, is the financial advisor's role in establishing and maintaining the financing's cost of issuance budget and in assisting in the procurement of additional financing related services. Some fees and charges which a municipal bond issuer must pay (e.g. rating agency fees, bond printing charges, etc.) are readily predictable. Others such as trustee/registrar fees, legal and advisory fees, official statement printing and, for negotiated sales, the fees associated with underwriting the debt are generally flexible and subject to some negotiations. To the maximum degree possible, the firms. selected to provide these services should be chosen through a competitive bid or request for proposed process in which, among other factors considered in the selection process, fees are required to be proposed. The financial advisor should be the first professional selection made by the issuer (perhaps in conjunction with bond counsel) so that all other selections will benefit from the advisor's input and evaluative skills. The advisor should ensure that fee proposals are realistic and reflect a thorough understanding of the services which the issuer expects to be delivered. This approach is particularly valuable in respect to bond registration services, printing and investment banking services, so that the changes which might occur in the course of executing the financing that would necessitate cost increases can be clearly identified. In many instances, the advisor can negotiate fixed fees (on a not -to -exceed bans) with other service providers, depending on the nature and scope of the transaction and the particular service. The advisor's ability to effectively represent the issuer in a negotiated underwriting is addressed more fully in Chapter However, this is an area where an issuer must depend heavily on the financial advisor for advice, information and negotiating skills. Prior to the day on which bonds are to be priced, the advisor will need to furnish his client with data on comparable financings to help evaluate the appropriateness or the reoffering yields and interest rate scale as well as the underwriting spreads, particularly the competitiveness of the sales commissions. Through this level of participation, an advisor can be expected to provide (i) management control, (ii) control and monitoring of issuance expenses, and when appropriate, (iii) effective and experienced negotiation of debt structure and bond pricing terms. While, it is ill advised to measure an advisor's contribution to a transaction solely in terms of "savings", an issuer should expect some calculable benefits in this category from the involvement of a financial advisor. • Enhancing Financial Management Techniques Many practices that characterize governments financial management too often survive their utility simply because "that's the way its always been done". Organization like GFOA have greatly accelerated the dissemination and implementation of modern financial management practices, but continued reinforcement of the need for review and upgrading of budgeting, accounting, cash management, pension system operations and internal control systems to name a few, is needed to assure steady progress. Many financial advisors represent a broad cross-section of governmental units and can provide an added source of information and advice about what other jurisdictions are doing and what is effective. PFM7 The rating agencies and financial guarantors (credit support banks and municipal bond insurors) are increasingly concerned about the quality of financial management of the credits they rate and insure. This concern emanates from the long term perspective that these organizations attempt to bring to their respective tasks. A financial advisor who is regularly in touch with these agencies can be an important conduit for communicating these credit concerns and for providing advice on the types of strategies and specific improvements that will be meaningful, at least from the credit perspective. • Raising the Public Comfort Level For most public officials, the municipal borrowing transaction, on which they will be asked to make a number of important decisions, will be the biggest financial transaction they will ever be involved. As trustees of the public interest, these officials have an interest in assuring that their financing is done appropriately and on the best terms possible. For far too many individuals, including elected officials, financial matters, particularly public finance, are seen as a confusing black box that they can never understand. This is a field that is best left to the experts --bankers, bond lawyers and accountants. While clearly a myopic and erroneous view, this unfortunate attitude provides another valuable role for the municipal financial advisor. First and foremost, the financial advisor should be viewed as a resource for informing the board or governing body of the issuing entity regarding the wide array of factors affecting the structure, rating and pricing of any particular debt transaction. By exposing the board to the "expert", potential problems can be deflected and the finance officer can avoid being directly put into a position where he or she might not have the requested information or be totally comfortable with the rationale for a specific course of action. Furthermore, the financial advisor carries little baggage to his trip before the governing body. Unlike the finance officer, who has probably run into controversy or budget matters, personnel or taxes in his or her routine interaction with the governing body, the financial advisor can generally come before that body with the dual advantage of being a recognized expert who has no axes to grind. Although using a financial advisor in this fashion will not avoid controversey where it is warranted, bringing the advisor into the very public aspects of the debt issuance process can be an effective device for dissipating some of the petty issues that arise and raising the level of comfort that the public will have with the capital formation process. • Providing Assistance Beyond Debt Management The final reason, creating new business opportunities for financial advisors, is the desire of many finance officers to have ongoing financial advice which integrates the overall financial policy and capital planning activities of a jurisdiction with the somewhat more routine aspects of managing its debt issuance process. This participation can be as diverse as PFM the government's needs suggests and might include assistance in the capital budget making process, routine reporting on Federal regulatory trends and their impact on the jurisdiction, development of an on -going communication's strategy to enhance investor relations, project feasibility analysis, assistance in obtaining the GFOA Certificate of Conformance for the annual financial report, and advice on funding pension liabilities and improving the treasury management function. The degree to which a finance officer might utilize the financial advisor to assist in these and other areas will depend on the community's needs, the advisors technical capabilities and expertise, and the ability of the issuer and advisor to structure a mutually satisfactory contracted arrangement to provide compensation to the advisor for services provided beyond those delivered in respect to the debt transaction. Clearly, the experience of many finance officers has been rewarding and beneficial where they have been able to depend on a single financial advisor to assist them in a broad range of public finance issues. Conclusions The use of municipal financial advisor has expanded considerably over the past decade particularly as the complexity and volatility of the tax-exempt capital markets has resulted in a proliferation of alternatives and confusion for finance officers. The acceptance of the professional role of the advisory has moved beyond simply the general purpose units of government. Today, special purpose authorities as well as major state and city credits including some of the best known credits in the market routinely employ financial advisors to guide them through the capital formation process and to serve as their negotiators with major Wall Street firms. In the future, the need for financial advisors appears even more promising. Consolidation within the financial community suggests a trend towards a small number of financial supermarkets and some smaller "speciality" firms. Federal antagonism towards tax-exempt financing coupled with strong preferences for a more equitable and streamlined tax system suggest new and far reaching limits on tax exempt financing. Finally, the prospect for more taxable financing, including tapping international capital market sources to fund projects which were once traditionally financed from tax-exempt markets, assures a more complex and demanding environment which finance officers will have to navigate. The challenge to those organizations wishing to meet this growing need for sound, prudent and thoughtful advice and cost-effective transaction management services will be to respond to the changing requirements dictated by the markets, provide a well trained and knowledgeable professional staff, and deliver fresh ideas and approaches to both the policy making and debt financing processes. The competitive nature of this business will demand nothing less. Public Financial Management, Inc. Advisors in Capital Formation and Project Finance 5900 Enterprise Parkway Fort Myers, Florida 33905 813-693-7117 Lavon R Wisher, Managing Consultant Mr. Danny L. Kolhage Clerk of the Ciruit Court Monroe County 500 Whitehead Street Key West, FL 33040 Dear Mr. Kolhage: Philadelphia New York Atlanta Buffalo Memphis Fort Myers May 13, 1986 When we met in Key West last week you requested that Public Financial Management, Inc. prepare two alternative compensation proposals as the basis for our discussions on Thursday regarding a financial advisory agreement between Public Financial Management and Monroe County. What follows are two proposals both of which provide fixed fee compensation for completed financing transactions and compensation for financial planning and other analytic services that is not contingent on financings. Alternative I Compensation for completed financing transactions would be $25,000. In addition, PFM would be paid a fixed monthly retainer of $2,500 for financial planning services including the development of an overall financing plan and other financial and feasibility analyses as requested. Alternative II Compensation for completed financing transactions would be $30,000. In addition, PFM would be paid on an hourly basis for work related to financial plan development and other non -transaction services. Such hourly compensation would be based upon the following fee schedule: Professional Senior Managing Consultant Managing Consultant Consultant Financial Analyst Hourly Rate $135.00 $120.00 $100.00 $ 80.00 In addition to the above schedules PFM would be compensated for reasonable, documented out-of-pocket expenses incurred for travel, meals and (4) An Affiliate of Marine Midland Bank, N.A. I Mr. Danny L. Kolhage Clerk of the Ciruit Court Monroe County May 13, 1986 Page 2 lodging. PFM would also be reimbursed for any extraordinary costs for graphics, printing and data processing which are incurred by PFM with the prior approval of the County. As we discussed PFM would not be compensated for travel from Philadelphia or other offices to Florida. Reimbursement for travel to Key West would be only for travel within Florida. I am looking forward to discussing these proposals with you on Thursday morning. We are very excited about the opportunity to begin working for the County. Sincerely, PUBLIC FINANCIAL MANAGEMENT, INC. Lavon P. Wisher Managing Consultant LPW/ses Public Financial Management, Inc. Advisors in Capital Formation and Project Finance 5900 Enterprise Parkway Philadelphia New York Fort Myers, Florida 33905 Atlanta Buffalo 813-693-7117 Memphis Fort Myers Lavon R Wisher, Managing Consultant July 15, 1986 Mr. Danny L. Kolhage Clerk of the Circuit Court Monroe County 500 Whitehead Street Key West, FL 33040 Mr. Kermit H. Lewin County Administrator Public Service Building, Wing II Stock Island Key West, FL 33040 Gentlemen: As per our conversation and to further outline our services as per our financial advisor agreement, please be advised of the following: The monthly retainer fee will include exclusive unlimited financial services to Monroe County, its departments, districts and agenices, to include, but not limited to, financial advise of bank loans, interim financings, bond pools and any other financial analysis as requested. The fixed fee will be for bond transactions that require the preparation of an official statement requiring full disclosure by the County. If I can provide additional information to clarify the provisions of the agreement, please advise. Sincerely, PUBLIC FINANCIAL MANAGEMENT, INC. Lavon Wisher Managing Consultant LW/lc (* An Affiliate of Marine Midland Bank, N.A. r Public Financial Management, Inc. Advisors in Capital Formation and Project Finance 5900 Enterprise Parkway Fort Myers, Florida 33905 813-693-7117 Lavon P. Wisher, Managing Consultant August 14, 1986 Mayor Wilhelmia Harvey Board of County Commissioners Monroe County Public Service Building (Wing II) Stock Island Key West, Florida 33040 Dear Mayor Harvey: FRIG Philadelphia New York Atlanta Buffalo Memphis Fort Myers The purpose of this letter is to provide you and the other County Commissioners with a progress report on our activities regarding the financial report for providing public facilities for Monroe County. You will note from the attached schedule "Progress Report" that the financial information needed to provide detailed debt capacity amounts was not received until August 1st. All the studies have been reviewed, the needs assessed and some of the policy decisions identified. The financial data is now being prepared to compare with short range and long term public facilities needs of Monroe County. It is my intent to be in Monroe County the week of August 18th and to meet with individual Commissioners and staff members. I am sure you are aware that Congress is scheduled to pass a tax reform act prior to September 1st (it is rumored that we may have a new tax bill before the end of the week). The final adopted bill could affect the structuring and scheduling of future bond issues for State and Local government. 4' ) An Affiliate of Marine Midland Bank, N.A. Page Two Mayor Wilhelmia Harvey August 14, 1986 I will discuss this issue more fully when I speak with you next week. It is our intent to have a schedule of events for your information and approval as soon as the financial analysis is complete. Sincerely, PUBLIC FINANCIAL) ,MANAGEMENT, INC. Lavon Wisher /k3 Managing Consultant LW/lc Aug86Har.PFM Enclosures: Progress Report Reports and Information Reviewed PFM July 1, 1986 July 1, 1986 July 10, 1986 July 18, 1986 July 21, 1986 July 22, 1986 July 29, 1986 August 1, 1986 MONROE COUNTY PROGRESS REPORT Met with staff and public officials in Key West, Florida (Requested itemized list of financial information needed). Received information regarding purchase of Whitehead St. and Southand St. Properties. Met in Homestead, Florida with Bob Harris, Post, Buckley, Shuh & Jernigan, Inc., and obtained reports, maps and studies on Monroe County. Submitted recommendation to County Administrator on offer to purchase property. Called the County Administrator and and advised that financial information needed for debt capacity study NOT received. Had a one (1) hour discussion with County Administrator about public facilities planning and discussed report reviewed (see attached list). Had a telephone conversation with finance director regarding financial data needed. Received financial data needed to do debt capacity studies. August 5,6,7, 1986 Reviewing financial information. MONROE COUNTY REPORTS AND INFORMATION REVIEWED o Appraisal and other data relative to acquiring Whitehead/Southand Property. 0 Legislative Act (CSKS/HB 1405) passed by 1986 Legislature regarding areas of critical State concern. o Review of data regarding sale of property by the General Services Administration (42 acres - portion of Truman Annex.) o Resolution and Bond documents relative to $2,000,000 1981 bond series. o Oct. 1983 Monroe County Jail/Government Facilities Planning Study prepared by Post, Buckley, Schuh & Jernigan, Inc. o May 1983 Monroe County Jail/Government Facilities Planning Study - Analysis of County Buildings. 0 1983 Upper Key Government Center Site Plan. o Marathon Government Center proposed Expansion Plan. 0 April 1986 updated space needs prepared by Post, Buckley, Schuh & Jernigan, Inc. 0 1985 Solid Waste Disposal and Management Study prepared by Hazen & Sawyer. 0 December 1985 Official Statement of MSD refunding improvement bonds official statement. 0 Audits for 1984 and 1985 prepared by Kemp & Rosasco. o Financial Reports for past five (5) fiscal years. 0 1985/86 Monroe County Budget. 0 Report by Post, Buckley, Schuh & Jernigan, Inc. regarding third floor shell of new jail addition. 0 Report of Post, Buckley, Schuh & Jernigan, Inc. regarding Plantation Key Government Center. 0 Data regarding purchase of Truman School. r�p o Information regarding Key Largo Library. o Bond documents relative to Card Sound Bridge. o Historical information regarding Monroe County Land Use Plan. (Reports by Seaman, Larson & Pardy) Q� M E M O R A N D U M DATE: June 10, 1993 TO: Sam Malinowski County Administrator's Office FROM: Rob Wolfe Asst. County Attorney RE: PFM contract In reviewing this contract I note that the minimum total compensation due is over $25,000, the amount at which the purchasing manual requires competitive bidding. Our files do not have a current PFM contract with any renewal clause which would obviate the need to go out for bid. Therefore, I suggest that you request that the BOCC waive the competitive bid requirement when this contract is presented to the Board. Alternatively, the Board may wish to go out for bid for these services. RW/bpl CC: Danny L. Kolhage PFM PLJBLIC RNANCIAL MANAGEMENT, INC. Financial and Investment Advisors 5900 Enterprise Parkway Fort Myers, FL 33905 813-693-7117 (Fax) 813-693-6384 Mr. Thomas Brown, County Administrator Monroe County 5100 Junior College Road Stock Island/Key West, Florida 33040 Dear Tom: (��q vir-,t� OA' 3 au AW) JV un�, 1993 Per your request, Public Financial Management, Inc. ("PFM") has completed the attached analysis of bond counsel fees. In order to provide a comparison, PFM gathered data from bond issues of a similar size (under $10 million) in the State of Florida over the past year (from May 1992 to May 1993). The attached chart illustrates that the average fee for a bond transaction under $10 million is $23,747 with $5.16 being the average per bond amount. It is necessary to point out that (i) there is a base amount of work required for any bond issue, regardless of the size, and (ii) the attached chart contains all Florida bond issues without regard to the complexity of the structure and/or the length of time required for completion. The fees paid for bond counsel for Monroe County's transactions are outlined below (this includes the bond counsel fees only and does not take into account any disclosure counsel fees): Public Improvement Refunding Revenue Bonds, Series 1993 $10,000 Card Sound Road & Bridge Revenue Bonds, Series 1993 10,000 Improvement Refunding Revenue Bonds, Series 1993 12.562 Average $10,854 Based on our experience in the issuance of tax exempt debt, the fees paid by the County for bond counsel services are fair and reasonable and in fact are lower than the standard fees for this type service. Please do not hesitate to contact me should you require additional information. Sincerely, PUBLIC FINANCIAL MANAGEMENT, INC. Lavon Wisher Managing Director cc: Jack London, Mayor A. Earl Cheal, Mayor Pro-Tem Shirley Freeman, Commissioner Wilhelmina Harvey, Commissioner Mary Kay Reich, Commissioner Danny Kolhage, Clerk of the Courts Melonie Bryan, Budget Director Atlanta Fort Myers Harrisburg Memphis New York Orlando Philadelphia San Francisco State College _ 4a) An Affiliate of Marine Midland Bank, N.A. 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A x•zld O O oaoa:a 0 0 0 C) 0 tn 0 0�p CD 0 C) pOp)� 7 O 'D o0 O r CO N N N 00 O0 n O 1, V 7 -cT Vi f7 fn .-+ O\ -�r �0 Q d y U A U c U s > > E > F U o o a o o Uo o UUti.UUin«..,OOO W U0.' N N.. N. N N � N� N N N O� O� O� N Ql w �2 m w C) 0 0 0 O N tn ~ H ft PFM PUBLIC RNANCIAL MANAGEMENT, INC. Financial and Investment Advisors Governor's Plaza North Mailing Address: 2101 North Front Street P.O. Box 11813 Building 3, Suite 200 Harrisburg, PA 17108 Harrisburg, PA 17110 717-232-2723 (Fax) 717-233-6073 Honorable Danny Kolhage Monroe County 500 Whitehead Street Key West, FL 33040 October 20, 1995 Dear Honorable Kolhage: The Managing Directors of Public Financial Management, Inc. ("PFM") are proud to announce they have reached an agreement with Marine Midland Bank("Marine") to purchase PFM from Marine. We expect the purchase to close on November 30, 1995. This agreement is the culmination of over eighteen months of negotiations and realization of the dream the Managing Directors of PFM have had for several years to own the firm we have built into die nation's leading financial and investment advisory firm. As the new owners and employees of PFM, we want to take this opportunity to thank you for working with us, for it is friends like you that have made PFM the great firm it is today. We want to assure you that all of us at PFM are committed to continue providing our clients the highest quality, state of the art financial advisory and investment management services. We also want to reaffirm our commitment to the concept of providing independent advice to our clients free from the pressures of selling securities either to our clients or to investors whose interest and objectives are different from those of our clients. Finally, we want to let you know that the current management team will continue to direct the operations of PFM in the future. As you probably already know, Marine had always taken a passive role in the management of PFM's business and therefore you will not see any difference in the leadership and direction of the firm as a result of the Managing Directors' purchase of the firm. Quite the contrary, we plan to continue to provide the same service by the same individuals you have come to know and depend upon at PFM. For your information, we have included with this letter a copy of a press release issued today from F. John White, PFM's chief executive officer, announcing the purchase. Since the purchase of PFM by its Managing Directors constitutes an assignment of our investment advisory agreement with you, we have also enclosed a letter that describes your rights under the agreement. If you have any questions about the details of the purchase or about how, if at all, the purchase will effect your relationship with PFM please feel free to contact us at (717) 232-2723. Atlanta Austin Boston Dallas Fort Myers Harrisburg Memphis Minneapolis New York Newport Beach Orlando Philadelphia Portland San Francisco An Affiliate of Marine Midland Bank Honorable Danny Kolhage Monroe County October 20, 1995 Page 2 Again thank you for your continued support of PFM. The new owners and employees of PFM look forward to working with you in the future. By: ' Sincerely, PUBLIC FINANCIAL MANAGEMENT, INC. By: Marty Margolis Lavon Wisher PFM PUBLIC R ANCIAL MANAGEME Nr, INC. Financial and Investment Advisors 201 South Orange Avenue, Suite 720 Orlando, FL 32801 407-648-2208 (Fax)407-648-1323 Honorable Danny Kolhage Monroe County 500 Whitehead Street Key West, FL 33040 October 20, 1995 Re: Investment Advisory Agreement with Public Financial Management, Inc. Dear Honorable Kolhage: The Managing Directors of Public Financial Management, Inc. ("PFM") have entered into an agreement pursuant to which they will purchase all of the outstanding stock of PFM from Marine Midland Bank. The proposed closing date for this transaction is November 30, 1995. After the closing, the investment advisory services of PFM will continue to be performed by the same persons, including the undersigned, who presently constitute PFM's investment advisory division. Section 202 (a) (i) of the Investment Advisers Act of 1940 deems this transaction to result in an assignment of your Investment Advisory Agreement with PFM (the "Agreement"). The Agreement provides that such an assignment cannot be effective without your consent. Accordingly, we are requesting your consent to the deemed assignment of the Agreement. If you consent to the deemed assignment, please execute the enclosed copy of this letter where indicated and return it to me in the enclosed self-addressed, stamped envelope no later than November 3i:, 1995. Your consent will not in any way modify the terms of the Agreement as now in effect and will not extend the duration of the Agreement if a fixed term is specified If PFM does not receive by November 30, 1995 any response from you -- either your written consent or a written notice of your election not to consent to the deemed assignment and thereby terminating the Agreement -- PFM will continue to provide investment advisory services to you pursuant to the Agreement after .November 30, 1995. If within 45 days after November 30, 1995 you do not give written notice of your election not to consent to the deemed assignment, thereby terminating the Agreement, it will be assumed that you have consented to the deemed assignment of the Agreement and the continuation of PFM's provision of investment advisory services to you pursuant to the Agreement. Your right to give notice of your election not to consent to the deemed assignment, with the effect of terminating the Agreement, is in addition to any other right of termination under the Agreement. Atlanta Austin Boston Denver Fort Myers Harrisburg Houston Memphis Minneapolis New York Newport Beach Orlando Philadelphia Portland San Francisco An Affiliate of Marine Midland Bank Honorable Kolhage Monroe County October 20, 1995 Page 2 If you have any questions concerning the matters discussed in this letter, please do not hesitate to call me. PFM very much appreciates having the opportunity to serve you as investment advisor, and we look forward to the continuation of our service to you. AGREED TO AND ACCEPTED BY: Monroe County Authorized Signature Title Date Very truly yours, Marty Margolis � Managing Director mm/winnie/office/consent.doc 10/20/95 October 20, 1995 FOR RELEASE: Monday October 23, 7:00 a.m. FOR FURTHER INFORMATION CONTACT: F. John White 215-567-6100 The sixteen Managing Directors of Public Financial Management, Inc. (PFM), the financial advisory and money management firm with 13 offices throughout the country, have reached an agreement with Marine Midland Bank, N.A. to purchase all of the firm's stock. The sale is expected to close in the next six weeks. "This is a very exciting time for all of us at PFM." said F. John White, Chief Executive Officer and one of PFM's sixteen Managing Directors, "It is the culmination of more than 18 months of negotiations and, for many of us, the realization of a dream we have had of owning the firm that we built into the best in the country at serving the financial and investment advisory needs of state and local governments. Although we have had a productive 10 year partnership with Marine, in recent years it became clear that their interest in the market we serve was greatly reduced. Everything about PFM, from the way we hire and train our people, to the services we offer, to the locations we operate from, is built around the needs of our clients. This management buyout will enable us to expand our services and reaffirm our commitment to offering the best independent financial and investment advice considering the long-term needs of our clients." PFM was the nation's leading financial advisor for the first three quarters of 1995 according to Securities Data Corporation, handling 148 issues, with a volume of more than $7 billion PFM manages more than $8 billion in cash, bond proceeds and reserves in over 300 client accounts for public agencies around the country. PFM also does arbitrage rebate work for clients and consults with municipalities on a full range of financial planning issues from capital budgeting to privatization to credit rating strategy. "In April of this year PFM celebrated its 20th anniversary," White continued, "and we aree especially pleased to be able to begin our third decade as we did our first, under independent ownership. We believe strongly that our business is about ideas and people. We work hard to recruit and train excellent people dedicated to bringing cutting edge ideas to our clients, who represent the people of their communities. The public sector faces great challenges in the immediate future and PFM is eager to help our clients meet those challenges in the most efficient and cost effective manner possible. At a time when many in America are expressing doubts about the ability of our governments to function as well as they have in the past, this buyout is a reflection of the faith we have in the long-term viability of American public sector financing. The United States has the most sophisticated system of infrastructure finance and management in the world and PFM looks forward to continuing to play a vital role in the development and maintenance of this system for many years to come." PFM employs 150 people and maintains offices in Atlanta, Austin, Boston, Dallas, Fort Myers, Harrisburg, Memphis, Minneapolis, Newport Beach, Orlando, Philadelphia, Portland and San Francisco and plans to open an office in Pittsburgh in the near future. 09/27/00 WEB 11 ; 39 FAX 9419391220 PUBLIC FI NC A.NG Q 001 iQ't0� Deer rwt r� rw�u s►..�-..r..,. sue.20i �i -two iinc F1, MyoM K =912 wvaw,pin com PPN .[ Public Hnancial Management Flo� mW Advkm Fax To ..— Firm From Lavon Weser Client # Patti Garrett KeHy Ryman fi__ �r� P . Fax �� -- 6 / Phi �.� 0-0 . r Including cover r Urgent D As Requested 0 For Review Ci Please Reply Message The ��ooncvntainawd bt �e m _:.-._�,..� eSsage � pi�v�egs�d and ccx�Kie�a! irdoRt�tion, tctblr�ded otdY �r 1he use of t, e�iitx names eve, �# a reader of message s tat ft k*mded r*ct 19M you are hereby no WW *WOW 110�% distr�ulkm or dopy of phis collml r�c+Mlioa k any 1PX IFYW HAVE i�E' ilEO THIS N Mrt lL"E KVm t16 iEclu r 1.- 09/27/00 WED 11.-36 F.kI 9419391220 KB%.IP � ?�lr'iNC 0027/00 11: 11 0407 848 1323 PUBLIC FINkNCIAL -�-+-� FT. MYERS 0 �I402 � oZ/oog Sep 27, 2000 11:03 am Prepared bar VBC Finance c:1 Btl..t iDN- ,. IBII.,i,i SOURCES AND USES OF FWDS SI.I BilhOU Dollar Project Fund Sources: Bond Proceeds: Par Anmxmt 1,107,525,DO.00 1,14D7,32s=00 Uses: Project Fund D"sita: Proj .. Fund DtHvcry bale ExpenseL Cost Of I&WM= 25000.00 UnderwriWa Dint 2,768,812.50 Hand Insurance (20 BPs) 4 SW 139.40 7,521,95I.90 Other Uses of Funds: Additional Proceeds 3,049.10 1,la7.S23►,000.00 Notes: DWPhis 100 as of September 26, 2000 All Po r Boats 09/27/00 WED 11: 37 F-kX 9419391220 PUBLl Fl ar' .'-`Ir"'LNG Q003 09/27/00 11:11 0407 948 1323 PUBLIC FINANCIAL -� �-� FT. MYERS IM003/ 09 SGp 27. ZUQO 11:03 am fteparcd by DBC FitlAaraa 2B11"IQ1V1BILLiUN) Page 2 BOND SUMMARY S►TATIS'nC S $l -I Bilhan Dollar proj=I:t F wj DDate OU0WW1 Delivery Date 01101/2001 Last Maturity 07/401/2030 Arbitrage Yir d .5.489468% Tine I *",St Cost .5.475203% Net Intemd Cast (NIC) .5.503600% Al1-In MC :5.514382% Av=W Coupon :5.490312% Avenge Life (yews) 18.814 Duration of law (years) 11.320 Pas' An orunt 1 J97,:525,00D.00 Bond Pnmmada I,,1tY?95259000.00 Tara! Interest 11144J)44,700.50 Net hnteneat 1.146.813,S 13.W Total Debt Service 2,2511.569,7W.50 MWmum Anwal Debt Service 74i,326*925.00 Average Annual Debt Service 76,.324,3%.63 UndarwriWs Feet (per S 1000) Avarage'i'skedown Other Foe 2.500000 Total Undervvrities Dlscom 2.500000 Died Price 99.750000 Par AverW Average 0 Co vnsnt Value Price Coupon Life Serial Bonds Due 2WI - 2025 782.850,lOMOD 100.090 5.377% 15.167 'lam 8cobd Due 2030 124,675,000.00 100.000 5.640% 27.610 Par Value + Ac cnwd bmmt + Pk(Discount) - Unda vdter's Discount - Cost of ism a " ftpense - other Ainouttta Target Value Target Date Yield 1,107,525,1100.00 18.814 A114n 71C Tic 19107,525.Q00. I,1 ti'7.5?,S,UOO,OQ -2,768A 12.50 _21768,812-50 -250,0W00 - "C13,139.40 J9104.756,187.50 01101tmi 5.475203% 1,100,003,048.10 01/01/2001 5.514382% ArbitzW Yield 1,I07.5259000-00 -4Afn- -1 191n 1.103.021.960.60 01101/ml 5.4894"g6 09/27/00 WED 11; 37 FAX 9419391220 PUBLIC FI C hlA.ltiG 09F/,2?/00 11: l�l ' 4 ?7 848 1323 FLrBLIC FINANCIAL a4FT. Q004 I�YF.R$ 01 Ofl4 / 009 Sep 27, 2000 11:03 am Pupped b7 DBC Finance ;IS I11IiLlLM BON131IUCING 31. l 19ililon DDHAr PrOJWA Fund purity Bond Cor�rporient Dgte ,�rrnount 14stc Yicdd prime Serial BOWS Due 2001- 2025; 07/01/2WI 8010,000 4.250% 4.250% 100.000 07/01/2002 17 ASAO 4.320% 4.320% 100.0m 07/01/2003 18,555,OW 4.350% 4.350% 100.000 07/01/2004 19,360„000 4.400% 4.40M 100.000 07/01/2005 20.2.15„000 4.430% 4.430% 100.000 C 7/01/2006 21,1151.000 4.510% 4.510% 100.000 07/01/2007 22,065,0W 4.SW% 4.5W% 100.000 07/011M 23,075,000 4.00% 4.650% 100.000 07/01/2009 24-150.000 4.720% 4.720% 100.000 07/01/2010 25,290AW 4.790% 4.78M 100.000 07/01/2011 26,495,000 4.BW% 4.8M 1W.000 07/01=12 27974999000 4,99ft 4 100.000 07/01/2013 29,175,000 S.090% 5 090% 100.000 07101=14 30,660.000 5. IN% 5.18m 100.000 07/01/2015 32.2.'50,1300 5.26" 5.2 100.000 07/OI/2016 33,945,000 5.340% 5.340% 100.000 07/01/2017 33.760.000 5.3W% 5.390% 100.000 07/01/2019 379695,000 5.440% 5.440% 100.0w 07/01/2DI9 39,735,000 5.4 SAWS 100. mo 07/01/2020 41�15,000 5.510% 5.510% 100.0w 07/01/2021 44,225AW 5.540% 5.540% 100.A00 07/01/=2 46l6750000 5.560% 5.560% 100.000 07/01/2023 49,270*0W 5.5w% 5.5W% 100.000 07101 /2024 52,020,000 5.6oD% 5.600% 100.000 07/01 /2025 54,930-j.0.W 5.610% 5.610% 100.000 7929850,000 TOM BMW Due 2030: 07101/2030 32405,0Q0 5.640% 5.640% 100.000 1,107,525,000 Dated Data 01V1/2001 Ddive y Date 01 /01/2001 First Coupon 07/0112001 Par AmgAt I.107,525,000.00 Original Issue Discwnt Profuctin 1.10715259000.00 100.0000i10% UudmWr tW$ Discow _2,768.812.50-0.250000% Pur beft Price Ammed Interest 11104,756,187.50 99.750000% Net Pwcm& , 1,104.756,127.50 09/27/00 WED 11: 37 F,4A 9419391220 F�;3�1.,� � LNC YA.'NG 06/27/00 1.1. 12 10407 649 1323 PUBLIC FINANCIAL -&-..* F r. MYERS � aa5 � 005 / 009 Sap 27, 2000 11:03 atn Prepared blr L*C Pinance :'BRUON-1BILL CW) Page 4 ROM DEBT SER%gClr $1.1 13illion DOUa r PrOjW Find POW Ending Principal Coup Debi S"vicc Annual Debt St v im 01101rml 07/01/ OI 01/01/2002 8,710.E 4.250% 29,4344431.00 3-8.11 i4,431.00 38,1 43I.00 07/01/2002 17,785,000 4,32�0% 29,269,343.30 29,269„343.50 29,2699343.W 47,054,343.50 76 323 687 01/01/2003 07/01/2003 01/01/2004 18,5551,0W 4.350% 29,985.197.50 ., 0 28,885„187.50 289=50 18 / . ✓0 47,440.1 B7.50 w00 76,325 75.00 07101/2004 19,360,000 4.400% 28,481 „616.25 28,431.616.25 28.481416.2.5 479341.616.25 01/01/2005 28,055496.25 28,0559696.25 76,323,232.50 07/01/ZOOS 01101/2006 20,215.000 4.450% 28*055*696.25 48,270.696,25 76,326,392.50 07/01/2l106 21,1151000 4.510% 27,605.912.50 27,605,912.50 27,603,91 Z.SO 48.720.912.50 76t326 825.00 01 /0112= 07/01/2007 221,065.000 4.58096 27,129.769.25 27,129,769.25 27, i 29,769.25 494194,769.25 01101/2008 26.624.480.75 26.624.490.75 76*324,538-50 07/0112tiQ8 al/0112009 23.075,040 4.650% 26,62080.73 491,699,480.75 761,323,961.50 07/01/20099 2421501000 4.720% 26,097,9g7.00 X087,987.00 26,Ot79987.00 50+237.987.00 76,325,974.00 0110MA10 07/01 /2010 25,290;Q00 4.790% 25.5189047.00 25,5139047.00 25,519,047.00 S0,80B.047.00 01/01 /2011 2013,616.00 24,913,616.00 76,326,094,00 07/0112011 01101/2012 26,495,000 4.880% 24,913,616.00 51,408,616.00 76*322423100 07/01/202 2 27,790,000 4.990% 24.267,138.00 24,267.138.00 24,267,138.00 52,057,138.00 76o324,276.00 01/01/2013 07IOa12013 29,175,000 5.090% 23573,777.50 23,573,777.50 239373.777.30 52,748,777.50 76,32ZS55.00 01/0112014 22,B31,273.75 22,931*273.75 07/0112014 01/01/2013 30.660,000 5.180% 22,831.273.75 53,491,273.75 76.3221,547. SO 07101/2015 32.2.50.000 5.260% 22,a37.179.75 22,637,179.75 22,037.179.75 349-297,179.75 76,324,359.50 O)MI/2016 07/01/2016 33,945,000 5.340% 21,189A4.75 21,189,04.75 21,189t004.75 55,134,004.75 0110IM17 20,292.673.25 20,292,675.25 76*3239009.50 07/01/W17 01/0112018 3597601000 5.390% 20,282.673.25 56,042*673.25 76.325.346.50 07/01=18 37,685,000 5.44o% 19,318,941.25 19.318,941.25 19,318,941.25 57,D03,941.25 769322,88150 01/01/2019 07/01/2019 39,735,E 5.480% 1 B,293,909.25 18.293.909.25 18,293,909.25 58.028,909.25 76,322,81 "0 01101r2m 0 7/0112020 41,915,000 5.510% 17,205,170.25 17.205,170.25 17,205,170.25 S9,120370.25 01/01/2021 16,050,412.00 l61050,412.00 76,325.W. 50 0710112021 01/01 /m 44,225,000 5.540% 16,050,412.00 60,27SA12.00 76*325,824.00 07/0112022 46*67SAW 5.560% 1025,379.50 14,825,379.50 14.8259379.50 61.500*379.50 769325,759.00 01/0112023 07/0I/2023 49.270,000 3.590% 13,527,814.50 13.527,814.50 13,527,814.50 62,797,814.50 76,325,629.00 01/01mu 07/0InM 52,a2O OW SAW% 12,153.191.50 12,153.141.50 12,153,18130 464.1739181.50 Ol/01/2025 07/01/W25 54.930,000 5.610% 10,696.621.50 10,696,621.50 10.696,621.50 76,326,363.00 01/01/2026 9,155.935.00 65,626,621.50 9,155,835.00 76,323,243.00 07/01/2426 01 /01/=7 58,0101t100 5.64M 9,155.835.00 67,165,835.W 76.321.670.W 07/01/2027 61.283.0OO 5.640% 7,519,953.00 7,519,933.00 7,519,953.00 689804,953.00 76,324,906.OG 01101/2OZB 07/01/2028 64.740.000 5.640% 5,791,716.00 5.791.716.00 5,791,716.W 70.531.716.W 76.323.432.00 09/27/00 n?D► 11: 38 FAX 9419391224 PUBLIC FI tiC MAING 09/27/00 11:12 0407 648 1323 PUBLIC FINANCIAL FT_ Q006 XNERSQD006/009 Sep 27. 2000 1 l :03 am Prepared by DBC Finance --MII.LION) Pagc S BOND DEBT SERVICE Si. I Billion Dollar project Fund Period End*g Principal Coupon Interm Debt Servim Annual D� S�noe IIIt�OII'2Q29 07J0I1=9 69.3909000 3i3O�48.00 5.6406 3�'6bi14S. 00 01101 ?,tt)30 07/01 r203o 4037 50.00 2.037,4M.W 7z,3s6,woo U37,sOMOD 76,3n,o96.0�0 742Sa,� 5.6 Z,437,450.00 74.287,4SO.00 76.324,9Q0.00 i, 07525, i,I4aoa4,70o.st3 2,251,50,700_50 2,251 s0 700_ so 09/27/00 WED 11 :.38 FAX 9419391220 PUBLIC FI tiC MA�iG 09/27/00 11:.12 1&407 048 1323 PUBLIC FINANCIAL -+-*-* W007 FT . Bi S 40 007 / 009 Sap 27, 2000 1 I.03 am Pitgm W by DOC Finance .--- _ .:1M I Im-lBui m) paw 6 PROJECT FUND $1- f Billion Dollar Project FaM 1ntwt &%ft ula! Date DcPWit S.dM684% PA"al Draws Behme 01/01/2WI 1,100,0009MD 1,)okm.00p 1,1001000,000 1.100,00000w U 1,100,O0,0ap I,IOOR000,000 09/27/00 WEB 11; 38 FAX 9419391220 PLBI,IC FTNC MA G 09/27/00 11: i2 0407 649 1323 PUBLIC FINANCIAL �a-� FT. NMS 008 NS 008 / 009 Sop 27, 2000 11:03 am Prepa W by DBC Finance: I BR.LION-1 BILI.Iflly) Psgc 7 UNDERWRITER'S DISMUMr $1.1 Billion Dollar project FUM UrAkr ritees Dix=nt S/1000 Anma t Other Lhxkrwrite es Discount . 250 2,7812. .._.,.._,...�.,... K 50 2.50 2s768.812,50 99/27/00 WED 11:38 FAX 9419391220 PUBLIC FINC MANG 0 1,127/00 1 Z : 13 wV407 648 1323' PUBLIC FINANCIAL FT. VYIRRS 009 Scp 27„ 2W0 11:03 ant Prepared by DBC Pit cc ..1 I3XUON-1$ILUON) p'W 8 -COST OP ISSUANCE $1 -I SilliOR MHOr Projwtt Pend Cali' of h"amce SiIOI)0 ---- Amount Odw Cost of Iauam 4.22573 25 000.00 0.22573 250.000 00 r 1• Feb 25 02 05:28p James L Roberts Co Rdmi n 305-292-4544 p.1 MEMORANDUM TO: Jim Hendrick County Attorney FROM: Jwiies L. Roberts County Administrator DATE: February 25, 2002 SUBJECT: PFM AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA Mr. Canary from PFM spoke to me in reference to their proposal to provide services to the Florida Keys Aqueduct Authority. I asked him to outline those services to be sure that there was not a conflict with their duties for Monroe County. Please review the attached memorandum from Mx. Canary and indicate whether you feel there are any conflicts with which the County should be concerned. le James L. Roberts County Administrator JLR:dlf Att. Cc: Danny Kolhage Feb 25 02 05:29p James L Ro berts Co Rdmin 305-292-4544 p.2 Suite 201 941 9393009 10100 peer Run Farms Road 941 939 1220 fax Fort Myers, FL. 33912-1045 www.pfm.com .r1. PEA i ILi-tri/ t ,II,P. I117.w11n...1.r i ��r-Irr 1 T. February 19, 2002 Memorandum To: James Roberts, County Administrator cc: Danny Kolhage, Clerk of Courts Monroe County Government From: Hal Canary, Senior Managing Consultant Re: Scope of Services for Florida Keys Aqueduct Authority Public Financial Management (PFM) has enjoyed a long and rewarding relationship with Monroe County Government (County). we believe the County has benefited from that relationship Lavon wisher built. Speaking for the sixteen professionals in PFM's Florida practice, I assure you that we will provide the sane high level of service and expertise that you p have come to expect from PFM. PFM has an opportunity to propose financial advisory services to the Florida Keys Aqueduct Authority (Authority). The Scope of Services stated in the Request for Proposals includes: The Authority is responsible for providing potable water to all of Monroe County and for the design, construction, operation and maintenance of wastewater facilities within designated areas of Monroe County. The Authority require uire q assistance in, but not limited to, the following areas: ➢ Monitor the capital facilities plan. ➢ Review, advise and assist in the implementation of cash management policies and debt restructuring. ➢ Monitor compliance with existing and future bond covenants on a regular basis, ➢ Assist with recognized bond counsel and the Authority's general counsel in the preparation of the necessary documents required for the authorization and issuance of bonds, or the restructuring of outstanding indebtedness. Feb 25 02 05:29p James L Roberts Co Rdmin 305-292-4544 p.3 James Roberts, County Administrator Monroe County Government February 19, 2002 Page 2 ➢ Assemble, review and analyze available data and information that may have a bearing on financing or refunding. ➢ Prepare and submit recommendations to proposed obligation repayment schedules, security pledges for the obligations, prior redemption features, reserve accounts, application of revenues and other details relating to the obligation and its repayment. ➢ Financial analysis assistance and forecasting as required for strategic planning. g All elements of the Scope of Services relate to debt financing transactions and debt management except the last one, which we view as technical support to a strategic planning g effort rather than strategic planning itself. To the extent we are asked to provide services outside of the debt area, PFM will be especially sensitive to issues that involve the Count will fill Y� y disclose our relationship with the County to the Authority and will recuse ourselves from Authority projects that may give rise to a conflict of interest. We hope this approach to ensuring that public agencies within Monroe County have access to the highest level of professional financial advice meets with your approval, as indicated pp by your email reply. Thank you for the opportunity to continue to serve Monroe Comity. Y Sincerely, PUBLIC FINANCIAL MANAGEMENT Hal W. Canary, CPA Senior Managing Consultant cc: Mr. Roger Braun, Executive Director Florida. Keys Aqueduct Authority