SUBJECT
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Approve Resolution of the Board of County Commissioners of Polk County, Florida, Approving the Issuance by the City of Lakeland, Florida of its Hospital Revenue Refunding Bonds (Lakeland Regional Health Systems) and approve Interlocal Agreement.
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DESCRIPTION
Polk County, Florida (“Polk County”) and the City of Lakeland, Florida (the "Issuer" or the "City") each have the authority pursuant to Part II, Chapter 159, Florida Statutes (the "Statute"), to issue healthcare facilities revenue bonds to finance qualifying projects.
Lakeland Regional Health Systems, Inc. (the "Borrower") has requested that the Issuer, City of Lakeland, issue bonds, in one or more series (the "Bonds"), and lend the proceeds of the Bonds to the Borrower to: (1) currently refund all or a portion of the City's outstanding Hospital Revenue Refunding Bonds (2) finance all or a portion of the costs (including reimbursement for prior related expenditures) relating to the conversion of the Borrower's hospital electronic medical record and billing system conversion primarily located at the LRMC Campus and the Cancer Center (3) finance all or a portion of the costs (including reimbursement for prior related expenditures) relating to the acquisition, construction, installation and equipping of certain capital improvements to the Borrower's healthcare facilities.
Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code") requires as a condition of exclusion from gross income for federal income tax purposes of interest on private activity bonds, as defined in Section 141(a) of the Code, such as the Bonds, that such Bonds be approved by the governmental unit(s) having jurisdiction over the area(s) in which the private activity bond-financed facilities are to be located after a public hearing following reasonable public notice.
The Issuer on June 15, 2026, held a public hearing on behalf of itself and Polk County with respect to the issuance of the Bonds by the Issuer after publication of notice of such hearing in The Ledger, a newspaper of general circulation in Polk County, Florida, at least 7 days prior to such hearing, as evidenced by the copy of the Affidavit of Publication is attached hereto as EXHIBIT A.
In a resolution of the Issuer adopted on June 15, 2026, the Issuer provided for the final approval of the issuance of the Bonds and directed that a copy of such resolution be provided to the Board of County Commissioners of Polk County and recommended approval of the Bonds by such Board of County Commissioners.
The Issuer has submitted to Polk County for consideration a form of Interlocal Agreement approved (after a noticed public hearing) by the Issuer which, when executed, will permit the loan of a portion of the Bond proceeds to the Borrower to finance and refinance the cost of the Project located in Polk County, a copy of which form of Interlocal Agreement is attached hereto as EXHIBIT B, to be executed by the BoCC Chair prior to or contemporaneously with the Resolution.
The approval given herein shall not be construed as (i) an endorsement of the creditworthiness of the Borrower or the financial viability of the Project, (ii) a recommendation to any prospective purchaser to purchase the Bonds, (iii) an evaluation of the likelihood of the repayment of the debt service on the Bonds, or (iv) approval of any necessary zoning or rezoning applications or approval or acquiescence to the alteration of existing zoning or land use nor approval for any other regulatory permits relating to the Project, and the Board shall not be construed by reason of its adoption of this Resolution to make any such endorsement, finding or recommendation or to have waived any right of the Board or estopping the Board from asserting any rights or responsibilities it may have in such regard. Further, the approval by the Board of the issuance of the Bonds by the Issuer shall not be construed to obligate Polk County to incur any liability, pecuniary or otherwise, in connection with either the issuance of the Bonds or the acquisition and construction of the Project.
Polk County shall have no responsibility with respect to the repayment of the Bonds. The Bonds and the interest thereon shall not constitute an indebtedness or pledge of the general credit or taxing power of Polk County but shall be payable solely from revenues pledged therefor pursuant to financing agreements entered into by and among the Issuer and the Borrower and/or parties other than Polk County prior to or contemporaneously with the issuance of the Bonds. Neither Polk County nor any of the members of the Board or staff of Polk County will have any obligation or liability, financial or otherwise, with respect to the Project or the Bonds.
RECOMMENDATION
Recommend Board approve Resolution and authorize the Chair to execute the Interlocal Agreement attached as Exhibit B.
FISCAL IMPACT
None.
CONTACT INFORMATION
Randy Mink, County Attorney
863-534-7679