Agenda Item No. VI. A. 2.

Washburn University Board of Regents



SUBJECT: Request for Proposal - Underwriting Services, Financial Advisory Services and Bond Counsel Services for Washburn University



BACKGROUND:



At the March 10, 1999 Board of Regents meeting, the Board approved awarding contracts to Cosgrove, Webb & Oman as bond counsel and Fahnestock & Co., Inc. as bond financial advisor for a period of five (5) years, ending on March 10, 2005. Prior to the expiration of the contracts, the Board of Regents asked the University's administration to obtain proposals from qualified municipal bond attorneys and firms that provide financial advisory and underwriting services.



DESCRIPTION:



Underwriting Services:



On February 23, 2005, a Request for Proposal was issued to fourteen (14) firms to provide underwriting services to Washburn University. On March 21, 2005, the University received proposals from five (5) firms: A.G. Edwards & Sons, Inc.; RBC Dain Rauscher, Inc.; Stern Brothers & Co.; Oppenheimer; and George K. Baum & Company.



The proposals were evaluated by an evaluation committee based on criteria including, but not limited to: experience of the firm in serving as underwriter to municipal tax-exempt issuers including institutions of higher education; understanding and competence in State of Kansas and federal taxation, legislative and regulatory procedures and innovative or alternative financing structures; qualifications of personnel including experience and availability of individuals; team organization and approach including ability of the firm to adequately staff and complete time-sensitive transactions; demonstrated commitment to understanding and serving client needs and responsiveness to client requests for assistance; responsiveness of written proposals to the purpose and scope of services to be performed; and responsiveness and reasonableness of proposed pricing structure.



Based upon its review and analysis, the committee concluded George K. Baum & Company should be awarded the contract to provide required underwriting services for the University for a five (5) year period.



The proposed fee structure is:



Takedown $3.60/$1,000

Expenses $0.40/$1,000

Management Fee $0.25/$1,000

Total: $4.25/$1,000

Bond Counsel Services:



On February 23, 2005, a Request for Proposal was issued to twenty-two (22) firms to provide bond counsel services to Washburn University. On March 21, 2005, the University received proposals from five (5) firms: Nichols and Wolfe Chartered; Kutak Rock, LLP; Robert J. Perry; Gilmore & Bell, P.C.; and Hinkle Elkouri Law Firm LLC.



The proposals were evaluated by an evaluation committee based on criteria including, but not limited to: experience of the firm in serving as bond counsel to municipal tax-exempt issuers including institutions of higher education; understanding and level of competence in State of Kansas and federal taxation, legislative and regulatory procedures; qualifications of the personnel including the experience and availability of the day-to-day attorney and the breadth and depth of other partners, associates and other professionals available to provide services to the University; team organization and approach including the ability of the firm to adequately staff and complete time-sensitive transactions; firm's demonstrated commitment to understanding and serving client needs and its responsiveness to client requests for assistance; responsiveness of written proposals to the purpose and scope of services to be performed; and responsiveness and reasonableness of proposed pricing structure.



Based upon its review and analysis, the committee concluded Hinkle Elkouri Law Firm LLC should be awarded the contract to provide required bond counsel services for the University for a five (5) year period.



The per bond fee schedule is as follows:



$1.40 per thousand dollars par amount up to $5 million

$1.10 per thousand dollars par amount from $5 million to $10 million

$0.90 per thousand dollars par amount from $10 million to $20 million; and

$0.70 per thousand dollars par amount above $20 million.



Financial Advisory Services:



On February 23, 2005, a Request for Proposal was issued to thirty (30) firms to provide financial advisory services to Washburn University. On March 21, 2005, the University received proposals from one (1) firm: Oppenheimer.



The evaluation committee concluded the Financial Advisory Services RFP closing date should be extended and no contract awarded at this time.



FINANCIAL IMPLICATIONS:



Any fees and expenses incurred under a contract awarded pursuant to the RFP's for Underwriting Services, Bond Counsel Services will be paid only for services rendered pursuant to the actual issuance of bonded indebtedness.



RECOMMENDATION:



President Farley recommends the Board of Regents approve awarding contracts effective May 13, 2005 to George K. Baum and Company for underwriting services and to Hinkle Elkouri Law Firm LLC for bond counsel services for a period of five (5) years.



_________________________ ______________________________

Date Jerry B. Farley, President


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