Botetourt County board approves financing parameters to cap new borrowing at $25 million for communications and 9-1-1 projects

The Botetourt County board voted to approve parameters allowing the county to borrow up to $25,000,000 to fund two public‑safety capital projects — an emergency communications radio system and upgrades to the Reed Mountain 9‑1‑1 center — and authorized staff to proceed with the financing documents and timelines required for a bond sale.

During the presentation, a county staff member summarized the projects and costs: "the communication system, $21,000,000, and the 9 1 1 center is $15,000,000 for a total of 36," and outlined two financing approaches. One option was to borrow the full amount (roughly $36.2 million) with illustrative terms (15 years for radio equipment, 20 years for the 9‑1‑1 center) and an example annual debt service of about $3.1 million at a 4.5% interest assumption. The staff member said they expected market rates to be lower than that illustrative rate.

The board approved option 2, which applies existing and additional fund balance to reduce new borrowing. Staff said about $6.7 million has already been paid from fund balance toward the radio project and proposed using an additional roughly $4.4 million of fund balance; that combination would lower new borrowing to $25 million and reduce annual debt service to approximately $2.0 million — a roughly $1.1 million annual saving compared with the full‑borrow example. Staff characterized those cumulative savings over the shorter 15‑year asset life as approximately $16–18 million.

Staff also addressed the county's unassigned fund balance and policy. The audited FY2025 unassigned fund balance was reported as about $42 million; the county's fund balance policy target is 25% of expenditures. Staff said that, under the projected FY26–FY27 budget and the proposed use of fund balance, the county would remain above the policy floor but cautioned these projections are not guarantees.

Separately, the county discussed refinancing an existing note related to the 2014 Public Safety Building/regional jail. Staff said the balance on that note is just under $7 million and that a PFM representative indicated the county should proceed with refinancing only if the net present value savings exceed 3%. If refinancing proceeds under that test, staff estimated savings of roughly $42,000 per year through 2033 (about $252,000 total).

A board member asked whether the county could withdraw if market underwriting produced unfavorable pricing. The presenter explained the board was being asked to approve not‑to‑exceed parameters (a maximum of $25,000,000 in new money and a not‑to‑exceed refunding amount) and reviewed the timeline: delivery of financing documents by March 20; a preliminary debt‑service schedule the week of the 16th; a more certain schedule the week of April 13; bond sale April 28; and a planned closing May 12.

Counsel/finance procedure was explained briefly: the county would execute a prime lease to the Virginia Resources Authority, which would issue bonds and lease the assets back to the county; a financing lease, a deed of trust and a tax‑compliance agreement would be delivered as part of the package to preserve tax‑exempt status where applicable.

After discussion, a board member moved to approve option 2 (the $25,000,000 parameter); the motion was seconded and passed. The board then moved, seconded and approved the resolution authorizing the financing documents. The meeting adjourned shortly afterward.

The transcript provided no explicit meeting date; the timeline quoted above reflects the sequence recorded in the meeting transcript. Additional details the board may receive later include final underwriting results and the final debt‑service schedule after pricing.