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Development Authority

The Development Authority of DeKalb County

from left, top row:  Dr. Eugene Walker – Chairman
Judy Turner - Vice Chair
Ed McBrayer - Treasurer
Dr. Delores P. Aldridge – Secretary

center row:  Michael D. Williams – Board Member
Vaughn Irons - Board Member
Dr. William Flippen - Board Member

bottom Row – Maria Mullins, Administrator to the Authority
Gregory Worthy, Counsel to the Authority

Development Authorities, including the Development Authority of DeKalb County, were created by the Georgia General Assembly for the purpose of promoting trade, commerce, industry, and employment opportunities for the public good and to promote the general welfare of the State. Comprised of seven board members, this authority was established in 1974 to promote economic development within DeKalb. It assists in financing business facilities and equipment for job creation and expansion. The Authority may package bond financing for companies based on the type and number of jobs produced.

There are two types of bond issued by the Authority, Taxable and Tax-Exempt:

Taxable
-Over $2 million
-Approved type of business (ex: manufacturing, office development) which will attract/retain jobs in the County

Tax-Exempt
-Less than $10 million
-Manufacturing facility
-501©(3) organization

Mechanics of a Bond Issue
Initial discussions must center around locating a business or a project in DeKalb County. Once that determination is made, preliminary discussions must begin between the company and its financial advisor and/or banker concerning the financial feasibility of the project and whether or not the company has or can raise sufficient capital and credit to do the necessary financing. The Authority does not provide any public funds or grant and does not provide any credit enhancement or placement services for the bonds.

Once a determination has been made for a project in DeKalb County and sufficient credit has been confirmed, the company is then free to file an application for an Inducement Resolution with the Authority. The application details the necessary accompanying financial statements and documentation needed for consideration.

The applicant and/or representing attorney will then appear before the Authority at the hearing on the Inducement Resolution. The Resolution itself is drafted by the counsel for the Authority and when adopted serves an indication of intent on the part of the Authority to issue bonds.

Following the adoption of an Inducement Resolution, the company should continue financial discussions with its underwriter or banker. When an agreement is reached as to the financial terms, bond counsel, if they have not already been engaged, should be engaged to draft documents which will be circulated to all interested parties. After discussion, these documents may be revised at the request of any party who is interested.

Once all the financial terms are agreed to and the paperwork completed there is another presentation to the Development Authority at another public meeting for final bond resolution. The Authority adopts this and the Authority counsel files court validation proceedings. Following this there is a pre-closing and closing.

Schedule of Typical Taxable Bond Transaction

1. Determination to locate project in DeKalb County
2. Application to Authority for Inducement Resolution.
3. Meeting of Authority and passage of inducement Resolution.
4. Arrangement of financial terms between Borrower and Underwriter or L.O.C. (Letter of Credit) bank.
5. Circulation of first draft of documents.
6. Revision of documents.
7. Meeting of Authority and adoption of final bond Resolution.
8. Filing of validation proceeding.
9. Publication of first notice.
10. Publication of second notice.
11. Validation.
12. Pre-closing.
    Closing.

Parties to Bond Transactions
"Authority" or "Issuer" - the Development Authority of DeKalb County, which issues bonds on behalf of Borrower.

"Bondholder" or "Purchaser" - the ultimate buyer of the Bonds.

"Borrower" - the person or entity primarily responsible for the repayment of the indebtedness.

"Trustee" - a corporate fiduciary charged with holding security for the bondholders, collecting payments and remitting them to the bondholder(s).

"Underwriter" - firm which is responsible for the marketing of the Bonds.<