Series 2017B Fastracks Sales Tax Revenue Bonds Official
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SUPPLEMENT TO OFFICIAL STATEMENT DATED JUNE 6, 2017 REGARDING $119,465,000 REGIONAL TRANSPORTATION DISTRICT (Colorado) Sales Tax Revenue Bonds (FasTracks Project) Series 2017B This Supplement to the Official Statement (this "Supplement") supplements the Official Statement dated June 6, 2017 (the "Official Statement") with respect to the above-captioned Bonds of the Regional Transportation District. This Supplement constitutes an integral part of the Official Statement and recipients are requested to attach this Supplement to the Official Statement. All capitalized terms not defined herein shall have the meaning set forth in the Official Statement. 1. The following language is added as a new last paragraph under "THE SALES TAX - General" on page 19 of the Official Statement: "On June 29, 2017, the Colorado Department of Revenue alerted RTD to a drafting error in Colorado Senate Bill 17-267 ("SB 267") that prevents numerous Colorado special districts, including RTD, from continuing to collect tax revenue from retail marijuana sales effective July 1, 2017. The special districts had not been advised of a potential impact or asked for fiscal note input, and the fiscal note prepared for the Colorado legislature did not mention any such fiscal impact. The revenue loss of the retail marijuana sales tax exemption was presumed to have been made whole by a corresponding increase in the rate of a separate, special sales tax collected on retail marijuana; however, special districts were not included in the special sales tax rate increase. While a correction to the drafting error is being pursued, assuming that no correction is made, the impact of SB 267 on RTD is currently estimated to be a reduction of approximately $500,000 in sales tax revenues per month, or approximately 1% of RTD’s sales tax revenues. If such a reduction had been in effect for the full 2016 calendar year, RTD estimates that gross debt service coverage for 2016 would have reduced from an actual debt service coverage of 3.33x to a debt service coverage of 3.29x. Accordingly, assuming that the drafting error is not corrected and the retail marijuana sales tax exemption remains in effect, RTD has determined that the reduction in sales tax revenues will not have a material impact on the Pledged Revenues." REGIONAL TRANSPORTATION DISTRICT Dated: July 19, 2017 NEW ISSUE—BOOK-ENTRY ONLY RATINGS: S&P: “AA+” Moody’s: “Aa2” Fitch: “AA” See “RATINGS” In the opinion of Butler Snow LLP, Bond Counsel, assuming continuous compliance with certain covenants described herein, interest on the Bonds is excludable from gross income under federal income tax laws pursuant to Section 103 of the Internal Revenue Code of 1986, as amended to the date of delivery of the Bonds (the “Tax Code”), interest on the Bonds is excludable from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code, except that such interest is required to be included in calculating the “adjusted current earnings” adjustment applicable to corporations for purposes of computing the alternative minimum taxable income of corporations, and interest on the Bonds is excludable from Colorado taxable income and Colorado alternative minimum taxable income under Colorado income tax laws in effect on the date of delivery of the Bonds as described herein. See “TAX MATTERS.” $119,465,000 REGIONAL TRANSPORTATION DISTRICT (Colorado) Sales Tax Revenue Bonds (FasTracks Project) Series 2017B Dated: Date of Delivery Due: November 1, as shown below The Sales Tax Revenue Bonds (FasTracks Project), Series 2017B captioned above (the “Bonds”) are issued and secured pursuant to an Indenture of Trust dated the date of issuance (the “Indenture”) between the Regional Transportation District (the “District” or “RTD”) and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”). Interest on the Bonds is payable on November 1, 2017 and each May 1 and November 1 thereafter. The Bonds are issuable in registered form and are initially to be registered in the name of Cede & Co., as nominee for The Depository Trust Company, New York, New York (“DTC”), as securities depository for the Bonds. Purchases by beneficial owners of the Bonds are to be made in book-entry form in the principal amount of $5,000 or any integral multiple thereof. Beneficial owners are not to receive certificates evidencing their interests in the Bonds. See “THE BONDS – Book-Entry Form.” MATURITY SCHEDULE(1) (CUSIP© 6-digit issue number: 759136(2)) Maturity Principal Interest (November 1) Amount Rate Yield CUSIP©(2) 2033 $27,950,000 5.000% 2.570%C UN2 2034 64,880,000 5.000 2.660 C UP7 2035 8,125,000 4.000 3.060 C UQ5 2036 18,510,000 4.000 3.100 C UR3 C Yield calculated to first optional call date of 11/1/2027. The Bonds are subject to redemption prior to their respective maturity dates as more fully described in “THE BONDS – Prior Redemption.” The Bonds are issued for the purpose of (a) refunding, paying and discharging certain of the District’s outstanding sales tax revenue bonds (as further defined and further described herein, the Refunding“ Project”) and (b) funding costs of issuance of the Bonds. See “PLAN OF FINANCE.” The Bonds are special and limited obligations of the District payable solely from and secured by (a) a non-exclusive first lien upon the revenues received by the District from its 0.4% sales tax, (b) a non-exclusive subordinate lien upon the revenues received by the District from an additional 0.6% sales tax and (c) proceeds of the Bonds and other legally available moneys and investments held in certain funds created under the Indenture. The Bonds do not constitute a general obligation of the District within the meaning of any constitutional or statutory debt limitation or provision and are not payable in whole or in part from the proceeds of ad valorem property taxes. See “SECURITY FOR THE BONDS.” The purchase and ownership of the Bonds involves investment risk. Prospective purchasers should give particular attention to the matters discussed under “RISK FACTORS.” This cover page contains certain information for quick reference only. It is not a summary of this issue. Investors should read this entire Official Statement to obtain information essential to making an informed investment decision. The Bonds are offered when, as and if executed and delivered and accepted by the Underwriters and subject to the approving legal opinion of Butler Snow LLP, Denver, Colorado, as Bond Counsel, and to certain other conditions. Hogan Lovells US LLP, Denver, Colorado, has acted as Disclosure Counsel to the District in connection with the Official Statement. Certain legal matters will be passed upon for the District by its General Counsel, Rolf Asphaug, Esq., and for the Underwriters by Kutak Rock LLP, Denver, Colorado. FirstSouthwest, a Division of Hilltop Securities Inc., is serving as Municipal Advisor to the District in connection with the issuance of the Bonds. It is expected that the Bonds in book-entry form will be available for deposit with and delivery to DTC on or about August 3, 2017. MORGAN STANLEY LOOP CAPITAL MARKETS GEORGE K. BAUM & COMPANY US BANCORP HARVESTONS SECURITIES INC. The date of this Official Statement is June 6, 2017. © Copyright 2017 CUSIP Global Services. CUSIP is a registered trademark of the American Bankers Association. CUSIP Global Services is managed on behalf of the American Bankers Association by S&P Global Market Intelligence. (1) This information is provided by the Municipal Advisor. (2) None of RTD, the Municipal Advisor or the Underwriters takes any responsibility for the accuracy of CUSIP numbers, which are included solely for the convenience of the owners of the Bonds. The CUSIP number for any maturity of the Bonds may be changed after the issuance of the Bonds as the result of various subsequent actions, including, without limitation, a refunding of all or a portion of such maturity or the procurement of secondary market insurance or other similar enhancement by investors that is applicable to all or a portion of certain maturities of the Bonds. No dealer, salesman or other person has been authorized to give any information or to make any representation with respect to the Bonds that is not contained in this Official Statement and, if given or made, such other information or representation must not be relied upon as having been authorized by the District, FirstSouthwest, a Division of Hilltop Securities Inc. (the "Municipal Advisor") or the underwriters listed on the cover hereof (collectively, the "Underwriters"). The information contained in this Official Statement is subject to change, and neither the delivery of this Official Statement nor any sale made after any such delivery creates any implication that there has been no change since the date of this Official Statement. This Official Statement does not constitute an offer to sell or the solicitation of any offer to buy, and there is to be no sale of any of, the Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation, or sale. The information set forth herein has been furnished by the District and includes information obtained from other sources, all of which are believed to be reliable. The information and expressions of opinion herein are subject to change without notice and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the District since the date hereof. Such information and expressions of opinion are made for the purpose of providing information to prospective investors and are not to be used for any other purpose or relied on by any other party.