HomeMy WebLinkAbout20050838.tiff TM TRANSMITTAL MEMORANDUM
Northwest Parkway
Public Highway Authority
3701 Northwest Parkway, Broomfield, Colorado 80020
j i I IQnwpku.org
Phone: 303-533-1200 Fax: 303-404-3049
PARKWAY
TO: NLUP Investors
FROM: Jill Lomoureux
CC:
DATE: Tuesday, November 15, 2005
SUBJECT: Northwest Parkway Bond Disclosure Document
Enclosed is the bond disclosure document for the 3rd Quarter of 2005. The PDF
file can also be found on the Investor's section of our website (www.nwpky.orq).
Please feel free to contact me if you have any questions or concerns.
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The Northwest Parkway
Disclosure Document 2005
NW
41 For the period ending 09/30/05 PARKWAY r
1A 5� � ��_{0b
TABLE OF CONTENTS
OVERVIEW 1
CONSTRUCTION OF THE NORTHWEST PARKWAY 1
SHERIDAN INTERCHANGE 2
PROJECT FINANCIAL HIGHLIGHTS 3
INVESTMENTS 4
BUDGET 4
BOND FINANCING 4
THE PEOPLE BEHIND THE PROJECT 5
N W Northwest Parkway Public Highway Authority
3701 Northwest Parkway
Broomfield, Colorado 80020
Telephone: 303-533-1200
Fax: 303-404-3049
www.nwpky.org
PARKWAY info@nwpky.org
7
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OVERVIEW operation/maintenance costs through the construction
period, and amounts due under certain reimbursement
agreements. In addition, the plan of finance provides for
The Northwest Parkway Public Highway Authority
debt service reserves, capitalized interest, contingency
The Northwest Parkway Public Highway Authority
(Authority) is a political subdivision of the State of Cob- funds, bond insurance premiums and issuance costs.
rado established in June 1999 with all the powers, duties
and privileges provided by the Public Highway Authority
Law. The Board of Directors of the Authority is currently
composed of one elected official from each of the City and CONSTRUCTION OF THE
i County of Broomfield, the City of Lafayette, and Weld NORTHWEST PARKWAY
County, Colorado. In 2002 the City of Arvada and Jeffer-
son County applied to the Board of Directors and were
approved for affiliate memberships to the Authority. Ex-
I Officio members include the Colorado Department of Design/Build Contractor
Transportation, the Regional Transportation District and In order to construct the Northwest Parkway, a Design-
: Interlocken Consolidated Metropolitan District. The Au- Build Contract between the Authority and NPC, a Colo-
, thority is responsible for the financing, construction and rado joint venture of Kiewit Western Co. and Washing-
operation of the toll highway known as the Northwest ton Group International, Inc. was executed on June 28,
Parkway (Parkway). 2001. The full notice to proceed was issued on June 28,
+ 2001 simultaneously with the financial closing. The con-
Project Description tract provided for the road to open to traffic by Decem-
The Northwest Parkway consists of the two-mile Inter- ber 31, 2003 with revenue collection to begin on the Pro-
locken Loop from State Highway 128 to Tape Drive (just ject Guaranteed Substantial Completion date of Febru-
south of the intersection with 96`" Street) connecting with ary 29, 2004. The road opening was achieved on No-
the nine-mile limited access toll highway constructed on vember 24, 2003. The final acceptance of all items in-
the northwestern perimeter of the Denver metropolitan cluded in the project was granted by the Project Guaran-
area that links the Interlocken Loop to 1-25. teed Final Acceptance of June 29, 2004.
The final segment of the E-470 toll road which connects ROW
with the Northwest Parkway at 1-25 was completed in To acquire the right-of-way for the Northwest Parkway a
) 2002, providing access to and from regional employment budget was established that included all estimated costs
for right-of-way acquisition including property acquisi-
and retail centers and facilitating travel from the northwest-
ern metropolitan area to points east and south, including Lion, legal, consultants and associated relocation costs.
Denver International Airport. Current construction work Under the Design-Build Contract, the Authority was re-
ncludes completion of an Interchange and maintenance quired to deliver on the contract schedule approximately
ifacility at Sheridan Boulevard. 564 acres of right-of-way. The Authority has obtained
possession of all of the required right-of-way; of this, 452
Plan of Finance acres are fee simple takes and the remainder is made
The Authority closed on project financing in June 2001 up by easements.
and simultaneously gave a notice to proceed to the De-
sign-Build Contractor— Northwest Parkway Constructors All right-of-way purchases have been finalized or have
(NPC). The plan of finance (see further description under had value determinations. The overall right-of-way costs
Project Financial Highlights) provides for the funding of have been under the allocated budget amount. Remain-
construction costs under the Design-Build Contract and ng costs include legal and consulting fees; however, the
other capital costs, as well as Authority administrative and Authority expects costs to remain under budget.
1
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SHERIDAN INTERCHANGE with Pirnack Walters as the design/build contractor at
the November 2004 board meeting. (Project comple-
Site Selection tion was achieved November 2005.)
The original Authority plan included construction of
an interchange at Sheridan Boulevard no later than
2010. Current development activities in that vicinity I , 1
indicated that it would be beneficial to Authority J'�,��' '//////f/�L f/ r f
revenues to open the interchange as soon is possi- 1
ble. Due to the fact that the majority of the Con- a�r
struction Contingency funds were not used from the I II -
original Design-Build Contract and associated mobi- {W, - -4-t - r - kaari
lization costs, it is possible to complete the con-
struction of the interchange and still have a Contin- - ,...'
r
gency Fund balance. S _ p '
4,714-
A critical path item to the construction of the Sheri- p a,' ,.
dan Interchange was to move the current temporary -i -- z - }-
maintenance facility. This was due to the fact that 44> ' C,:--,-44,-z. -l'. :• r
the temporary maintenance facility sat in the middle of the proposed west bound on-ramp from Sheridan Interchange Status
to the Parkway. In 2004, the Authority executed a contract with Carter Bur-
gess (CB) for design review and construction maintenance
The City and County of Broomfield is requiring the on the Sheridan Interchange project. Design of the Sheri-
dan Interchange is 100% complete.
Authority to construct a permanent maintenance fa-
cility rather than moving the temporary facility. The The Sheridan Interchange project was constructed as a
Authority determined that the best site for the main- design, bid, build project. The Authority selected SEMA as
tenance facility was east of the Sheridan Inter- the general contractor in February 2005. (The contractor
change location on land owned by the Pulte Corpo- provided for an early opening on November 7, 2005.) The
ration. project consists of on and off ramps from the Parkway to
Sheridan, two unmanned toll booths with coin machines
As part of its Anthem development plan, the Pulte and automated Express Toll collection capability, inter-
Corporation wanted to obtain land to hold for perma- change lighting, and interchange landscaping. In addition,
nent open space. The Authority owned land ac- a change order was been executed with NPC to provide
quired for the purpose of holding for open space. concrete slab approach ramps. The construction budget
The Authority has traded parcels of land with Pulte. for the interchange including the toll collection system in-
There was no monetary consideration involved in stallation is approximately $5,200,000 which is available
this transaction. The trade allowed the Authority to from remaining contingency funds.
gain approval from Broomfield for construction of
the permanent maintenance site, and begin con-
struction on both the site and the Sheridan Inter- Operations Report
change. (Completion of the maintenance site oc- EXpressToll is the Denver area branding for the trans-
curred November 2005. The Sheridan Interchange ponder system that allows non-stop use of the toll roads.
opened to traffic November 7, 2005.) These transponders are functional on both the Northwest
Parkway and the E-470 toll road.
Maintenance Facility Status In this quarter, 151 transponders were issued for new EX-
In August 2004, the Authority entered a contract press Toll accounts opened at the Parkway's mainline Toll
with Eidos Architects, LLC to design a maintenance Plaza. A total of 9,763 new EXpress Toll accounts were
facility. The building was designed to meet strict opened in this period through the EXpress Toll website,
aesthetic criteria from the City and County of service centers and area retail outlets. Due to interopera-
Broomfield. The project consists of covered parking bility agreements between the Authority and the E-470
for six snow plows, a 1,500 sq. ft. office, a 1,000 sq. Public Highway Authority (E-470), the Authority benefits
ft. storage area, a fuel island for diesel and gasoline, from the entire EXpress Toll customers base of over
storage tanks for anti-ice chemicals, covered stor- 192,146 accounts.
age for salt and sand, and a separate building for
vehicle maintenance. The construction budget for The Authority, through an Intergovernmental Agreement
the maintenance facility is $1,460,000 which will be (IGA) with E-470, has contracted with Mile High Toll Ser-
paid from available contingency funds. The Author- vices (MHTS) to provide toll operations for the Park-
ity recommended and received approval to contract way. MHTS is a division of Parsons Brinckerhoff. 2
The IGA also provides for the Authority to utilize the back Total transactions for September were 321,097 with an ADT of
10.703 which is a 4.5% decrease from August. Year-over-year office operations of E-470 for EXpressToll processing
and customer service functions. transaction increases remain strong averaging 39% compared to
this point in 2004.
Operations of the Parkway are continuing smoothly as Monthly Transactions
traffic steadily increases. Detailed auditing has shown
that MHTS continues to perform within industry stan-
dards. The EXpressToll transactions that are handled by 350,000
the E-470 customer service center are exchanged on a 300,000 �
nightly basis and payments are regularly audited by Au- 250,000 1 1
thority staff. The violation system continues to operate 200,000 Mils
; 1 r rs r 1
effectively. 150,000 �;
� � 1
The Authority has entered into a three-year contract for 100,000 ' i . I rr. ' _ 1
roadside, roadway and facilities maintenance with Amen- 50,000 r' I I f 1
�� I -
can Civil Constructors (ACC). ACC handles all snow re- c I 1
moval on the Parkway and operates the Parkway's Cour- co LL 03 S ` ' 2004
tesy Patrol. Maintenance work on the Parkway has pro- ≤ ex
■2004
ceeded as scheduled. •2005
Project Warranty ended on February 28, 2005, one year
after substantial completion was reached on February 28,
2004. A portion of warranty items were completed by PROJECT FINANCIAL HIGHLIGHTS
Project Warranty period ending date. Other items that
require moderate weather conditions were transferred to Original Capital Budget
a new Warranty Deferred List that was completed by The total capital budget for the Northwest Parkway at financial
June 15, 2005. closing was set at$242,637,528, excluding contingency funds.
After adjusting for all change orders through June 30, 2005 the
Law enforcement and incident management on the Park- total capital budget is$246,330,230 excluding the remaining
way is handled by the City of Broomfield Police Depart- contingency fund budget. The amount of expenditures through
ment through an IGA with the Authority. Both the police September 30, 2005 total$235,426,298. The payments to NPC
and the North Metro Fire District(NMFD) respond to any for approved work included in that total are$191,615,337 repre-
occurrences as needed and continue to meet the Author- senting 100% of the contract.
ity's requests and requirements. The NMFD has broken •
ground on a new fire station along the Parkway which is The original Contract Amount of the Design-Build Contract was
scheduled to be completed December 2005. $187,637,528. Change orders approved through June 30, 2005
increased that amount to $191,615,337. There were eighty-one
contract changes authorized, with a total cost impact of
Traffic Summary $3,977,809. However, six change orders, in the amount of
Toll collections for both cash and EXpress Toll customers $1,269,788, were funded by third parties. In addition, one
change order was funded as a transfer from the Northwest
began on January 1, 2004, after a system testing and Parkway Right-of-Way budget in the amount$285,107. There
marketing period following the opening. During this pe- also was an adjustment for actual waterline costs incurred.
riod no tolls were initially assessed and then a period fol-
lowed during which tolls were charged only to cash cus- Sheridan Interchange Budget
tomers as an incentive for users to purchase EXpress The budget allocated to the Sheridan Interchange is$7,750,000
Toll privileges. which was transferred from the Contingency Budget. The allo-
cated budget includes funds for design, construction and toll
During the first full year of roadway operations, traffic lev- system implementation for the interchange and maintenance
els and toll revenues were significantly below initial pro- facility. Also included in the budget is a change order to the
jections. The Authority attributes these results to the eco- Design-Build Contract in the amount of$86,782 for the concrete
nor=downturn experienced in the state over the past slab approach ramps at the Sheridan Interchange.
several years and the resulting delay of development Contingency Fund Status
within the corridor. The development activities in the cor- The original allocated budget for Contingency was$18,763,753,
ridor have increased in 2005, and the Authority antici- including expected interest earnings over the life of construc-
pates that traffic levels and toll revenues will improve as tion. Approved change orders to the original Design-Build con-
development and natural ramp up occurs. The Authority tract total $3,977,809. However, after adjusting for third party
does not expect, however, that the initial revenue projec- funded change orders and a transfer from the Right-of-Way
tions will be achieved in the short term. budget, the net charge against the original contingency fund is
currently$2,422,914, which adjusts the allocated budget
Total transactions for July 2005 were 319,481. Average amount to$16,340,839. The Authority has also transferred
daily transactions (ADT) for July were 10,306, a .3.4% $3,807,601 for start-up and mobilization costs and plans to
decrease from June traffic. Total transactions in August transfer an additional $7,750,000 for the Sheridan Interchange
were 347,301, with an ADT of 11,203 which is a 8.7% and maintenance facility project. The remaining unallocated
increase over July. Contingency Budget is $4,783,238. 3
INVESTMENTS BOND FINANCING
Bond Financing
Construction Fund The Northwest Parkway Public Highway Authority issued approximately
(a) At the time of closing. $245.114,354 was invested in two $364 million of insured Senior Bonds and approximately $52 million of
separate Investment Agreements with Trinity Funding Subordinate Bonds in June 2001 to fund the construction of the North-
Company.which submitted the successful bid. One ac- west Parkway toll road project. The underwriters were George K Baum&
count has closed and the remaining balance was trans- Company and Bear, Stearns & Co. Inc. PBConsult Inc. was the financial
ferred to COLOTRUST,while the second account will consultant and provided the chief financial officer for the Authority. A.G.
remain with Trinity Funding until December 2007. Edwards & Sons, Inc. was the financial advisor. Vollmer Associates con-
(b) Bond proceeds in the Construction Fund which were not ducted the traffic and revenue study with PB Consult Inc. providing the
invested in that Investment Agreement are invested by economic/land use inputs for the study.
the Trustee in either a Welts Fargo money market fund or
the AAA Colorado Local Government Liquid Asset Trust. The Senior Bonds received bond insurance from both Ambac and FSA
resulting in a positive reception of Northwest Parkway Authority bonds in
the market. The Senior Bonds received investment grade underlying
Debt Service Reserve Fund ratings from all three rating agencies: Standard & Poor's and Fitch rated
$36,161,406.28 of the Senior Bond proceeds were invested for the Senior Bonds BBB—and Moody's Investors Service rated them Baa3.
the Senior Debt Service Reserve Fund in a Debt Service Re- The Subordinate Bonds received Moody's Bal rating and a BB-plus from
• serve Forward Delivery Agreement with Bayerische Hypo- and Standard& Poor's.
Vereinsbank AG, New York Branch, who was the successful
bidder. Fitch and Moody's subsequently affirmed their underlying ratings but is-
sued negative outlooks. In August, 2005, Standard & Poor's place its
Capitalized Interest Fund underlying ratings on the Senior Bonds and Subordinate Bonds on Credit-
The capitalized interest amount from the bond proceeds of Watch with negative implications, citing concerns with the traffic and reve-
$43,047,440.50 was invested in an Investment Agreement with nue performance of the Parkway. (Since the end of the quarter, Fitch
AIG Matched Funding Corp. This Investment Agreement is took similar action, placing the Senior Bonds on Rating Watch Negative
expected to provide returns which,when combined with interest on October 3, 2005.) Please contact the individual rating agencies for
flowing from the Debt Service Reserve,will provide the neces- additional information.
sary interest payments through the capitalized interest period.
• The Source and Uses for the Northwest Parkway Bond issue are esti-
mated as follows:
2005 BUDGET Sources of Funds:
Series 2001A Bonds $175.720,000
The Authority adopted the 2005 budget on No- Sues 20o B Bonds 79,865.792
vember 23, 2004. Upon completion of the 2004 (Capital Appreciation)
audit, a budget hearing was held and an Series 2001C Bonds 08,371.280
(Convertible Capital Appreciation)
amended budget which includes all carry for- Series 2001D Bonds 52,465,000
ward amounts for capital items was adopted by (First Tier Subordinate)
Cothe Northwest Parkway Authority Board of Direc- Net
Original rig Department Discount of Transportation 723,000,562)
Net Issue (4,025,562)
tors at the May 24, 2005 meeting.
TOTAL SOURCES $413,119,510
REVENUES Uses of Funds:
Design-Build Contract Price $179,819,232
Investment Income $ 3,800,000 (net of interest earnings)
•
Other Costs of the Project(1) 104,738.219
Toll Revenue 10,414,000 Capitalized Interest 2001A,2001D 43.047,440
Miscellaneous Income 5,000 Debt Service Reserve Accounts 41,239,651
Cost of Issuance/Underwriters Discount 26,617,107
Project Contingency 17.657,861
TOTAL REVENUES $14,219,000 (available for Project Costs)
TOTAL USES $413,119,510
(1) Includes right-of-way acquisitions, project oversight engineering services.adminis-
trative costs,and amounts due under certain reimbursement agreements.
EXPENDITURES Bond Restructuring
Authority staff regularly monitors cash flow and revenue covenants relat-
Capital $ 34,242,967 ing to the Authority's bond obligations and during the quarter explored
Debt-Related 58,051,783 several options relating to the Authority's outstanding bonds. On Novem-
ber 2, 2005, the Board, acting on the recommendation of the staff and the
•
Operating Expenses 3,861,843 Authority's financial advisor, RBC Dain Rauscher Inc., authorized the staff
•
Administrative Expenses 775,000 to proceed with Bear, Stearns & Company and George K. Baum &Com-
• Personnel Expenses 960,668 pany to refund a portion of the Authority's outstanding bonds and thereby
Professional Services 530,901 restructure its bond obligations. It is expected that the refunding will be
completed by December 31, 2005, and that all Senior Bonds outstanding
Furniture & Fixtures 50,000 after the refunding will be insured by Ambac and FSA and will carry un-
Contingency 25,000 derlying investment grade ratings from Standard & Poor's, Fitch and
Moody's. Subordinate Bonds outstanding after the refunding are ex-
TOTAL EXPENDITURES $98,498,162 petted to be neither insured nor rated.
4
PEOPLE BEHIND
THE PROJECT
Board of Directors
Chris Berry, City of Lafayette
Vice-Chairman of the Board
Alternate - Kerry Bensman - j
Karen Stuart, City and County of Broomfield -
Chairman of the Board
Alternate —Walt Spader r
s
Glenn Vaad, Weld County
Secretary/Treasurer of the Board
Alternate — Robert Masden
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Associate Members
r..` .
Lorraine Anderson, City of Arvada 1. Pup"" S
Alternate— Don Allard
Jefferson County
Ex-Officio Directors
Joe Jehn, Colorado Transportation Commission
Alternate — Peggy Catlin, Colorado Department of _ --�_T'_-
Transportation —✓�
Wallace Pulliam, Regional Transportation District
Alternate—Lee Kemp
Joel Rosenstein, Interlocken Consolidated Metropolitan
District
Alternate— Gwen Anderson
Authority Senior Staff Authority Core Consulting Team
Stephen D. Hogan — Executive Director
Richard Bauman—Chief Engineer Norman Lovejoy—Consulting Engineer
Steven Bobrick—Business Manager Ed Icenogle—General Counsel
Benton Tempas— IT Director Erin Smith — Lead Right-of-Way Counsel
Pamela Bailey Campbell—Chief Financial Officer Mark May— Right-of-Way Counsel
(Carter& Burgess, Inc.) Mark Shotkoski — Project Oversight Engineering
Firm Manager
Mary Brown — Public and Governmental Relations
Carolyn McIntosh —Special Governmental Counsel
Howard Kenison — Special Environment Counsel
5
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Northwest Parkway Public Highway Authority
3701 Northwest Parkway
Broomfield, CO 80020
Telephone: 303-533-1200
Fax: 303-404-3049
www.nwpky.org
info@nwpky.org
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