CHICAGO — The Cook County, Ill., Board of Commissioners Wednesday approved a master bond ordinance that clears the way for the new administration’s first finance team and its first market transaction.
The approval means the county can start making final preparations to enter the market as soon as next month with up to $425 million of refunding bonds to achieve savings that are key to balancing the fiscal 2011 budget.
The finance team is made up almost exclusively of Chicago-based and women-owned businesses. The administration submitted the finance team and bond ordinance approving the refunding to the board July 12. The finance committee approved the ordinance Monday, and the full board passed it without comment at its Wednesday meeting.
Cook finance officials are also busy putting the final touches on a preliminary 2012 budget as well as the county’s 2010 audit.
The administration is expected to release the budget today. Board President Toni Preckwinkle warned that layoffs are “inevitable” this year.
The county plans to meet with rating agencies in August for the first time.
The ordinance authorizes the county to refund up to $900 million of general obligation bonds over the next two years to achieve budget savings. Cook has $3.5 billion of outstanding debt.
The county tapped William Blair & Co. as senior manager and Cabrera Capital Markets LLC as co-senior manager. Co-managers are BMO Capital Markets, Goldman Sachs & Co., Mesirow Financial Inc., Loop Capital Markets LLC, Melvin & Co., and Podesta & Co.
All of the firms with the exception of Goldman are based here and Cabrera, Loop, and Melvin are also certified minority-owned firms, while Podesta is women-owned.
Preckwinkle is sticking with a longtime county adviser, A.C. Advisory Inc., though the county may hire another firm down the road, according to chief financial officer Tariq Malhance.
Bond counsel is Chapman & Cutler LLP and co-bond counsel is Sanchez Daniels & Hoffman LLP. Underwriters’ counsel is Ungaretti & Harris LLP and co-underwriters’ counsel is Charity & Associates PC.
The current budget relies on savings generated by restructuring some of the county’s debt and pushing off $87 million of debt service payments due in 2011. The county also plans to restructure $92 million of payments scheduled for 2012 and 2013.
Also at Wednesday’s meeting, the board referred to the pension committee a measure introduced by Cook Treasurer Maria Pappas that requires the county’s local governments to report their other post-employment benefit liabilities.
The measure would expand an existing debt disclosure law — also introduced by Pappas — requiring the county’s 553 municipalities to report their yearly budget and their debt, including their unfunded pension liabilities.