I’m here at the Navajo Council’s Naabiki’yati’ Committee where legislative staff read LEGISLATION 0213-13, THE $220 MILLION BOND/LOAN. Sponsor Council Delegate Katherine Benally is talking about the history of LEGISLATION 0213-13. She also notes that LEGISLATION 0213-13 does not require Council action, which means the buck stops here.
I posted information about the $220 million Bond/Loan yesterday, which included the Web Address for LEGISLATION 0213-13. I’m posting it here again.
The official title of LEGISLATION 0213-13 IS “Relating to Resources and Development and Budget and Finance; Declaring its Official Intent to Reimburse Itself with the Proceeds of the General Obligation Bonds And/Or the Draw-Down General Obligation Bonds in One or More Series in the Aggregate Total Amount of up to Two Hundred Twenty Million Dollars $220,000,000) to Refund Certain Outstanding Bank Indebtedness and to Finance Economic Development and Infrastructure Projects in Two Components: A) $100 Million in General Obligation Bonds (In the Form of Long-Term Fixed Rate Bonds to be Sold to Institutional Investors) and B) Up to $120 Million in Draw-Down General Obligation Bonds (In the Form of a Bank Loan(s) that can be Drawn on as Needed to Fund Approved Projects) and Subject to Completion of Independent Credit Review and Approval Process Prior to the Funding of Any Economic Development.”
The Sponsors of LEGISLATION 0213-13 are DELEGATES Katherine Benally, Leonard Pete, Honorable Joshua Lavar Butler, George Apachito, Walter Phelps, Mel R. Begay, Jonathan L. Hale, Charles Damon II, and Speaker Johnny Naize.
LEGISLATION 0213-13 is 118 pages and includes the list of projects that the $220 m. bond/loan will fund. The list can be found on page 60 and is titled Navajo Nation Division of Economic Development “Economic Development 5-Year Plan Proposal 2010-2014” which was approved in May 2010 by the then Navajo Council’s Economic Development Committee. Delegate Katherine Benally, who now serves as the Council’s Resources and Development Committee chairperson, served on the former Economic Development Committee in May 2010 and so did current Council Delegate Kenneth Maryboy.
Since the $220 m. is a bond/loan, the plan is to reply the $220 m. with revenues generated from the projects that are constructed by the $220 m. According to a Sept. 23, 2010, memo from The Whitman Group LLC, which was created “in January 2007 to provide financial advisory services to Native American Tribes, manufacturing companies and not for profit organizations, “The project must demonstrate that it will create enough profit to repay the nation for its loan. This will be demonstrated from either historical financial performance for existing businesses looking to expand or through independent market feasibility study acceptable to the Enterprise.”
The Whitman Group strongly recommended to the Council’s Budget and Finance Committee Chairperson LoRenzo Bates and Resources and Development Committee Chairperson Katherine Benally that money “not be invested into any economic development project until that project has been thoroughly reviewed and examined by an independent experienced professional team that will apply specific project criteria and credit approval policies. This credit approval process, which will also include ongoing monitoring of each project, will be conducted by a new Economic Development Enterprise that will employ professionals with direct lending and/or economic development experience…and will work closely with the Division of Economic Development to insure a comprehensive and long term strategy is properly implemented.”
The September 2010 memo from the Whitman Group to Delegates Bates and Benally is Exhibit B of LEGISLATION 0213-13.
According to LEGISLATION 0213-13, paragraph J, the Bond Package includes: “up to $220 million, consisting of the amount required to refund the KeyBank Loans and up to S 155 million comprising four project groups: a) 5-Year Plan Year l DED projects $49 million (Exhibits Al); b) 5-Year Plan Year 2 DED projects $53 million (Exhibit A2); c) NTUA utility infrastructure projects – $35 million (Exhibit A3); and, d) Addendum projects $18 million (Exhibit M). All amounts are rounded down to the million figure.”
The following is information provided by the Whiteman group: “TRIBAL FUNDING OPPORTUNITIES, NEW MARKET TAX CREDITS, TAX EXEMPT BONDS” BY THE WHITMAN GROUP”
WEB ADDRESS FOR LEGISLATION 0213-13: https://drive.google.com/file/d/0B7xhIWpNuJXiU1ZaUkMwc01GdTA/edit?usp=sharing