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Request For

RFP - Professional Quantitative Services

RFP - Professional Quantitative Services

Kentucky Housing Corporation (KHC) is issuing this Request for Proposals (RFP) from qualified firms to provide professional quantitative services to the Corporation for the period beginning July 1, 2019 through June 30, 2020. KHC will enter Competitive Negotiations with any Bidder that is deemed a Responsible and Responsive Bidder to this RFP.

KHC is the state housing finance agency and a political subdivision of the Commonwealth of Kentucky. Created by the General Assembly in 1972, KHC’s mission is to invest in quality housing solutions for families and communities across Kentucky. KHC was the first housing finance agency in the nation to receive ratings of AAA and Aaa from Standard & Poor’s Corporation and Moody’s Investors Service, respectively.

The Corporation is committed to its mission of promoting, developing and providing a wide range of housing opportunities to assist lower- and moderate-income individuals and families obtain decent, affordable housing. Since inception, the Corporation has issued in excess of $5 billion in mortgage revenue under the Housing Revenue Bond Indenture – a parity indenture through which the Corporation issues all its debt. As of January 1, 2019, bonds in the
principal amount of approximately $436.7 million were outstanding. The bonds are securitized by a mortgage portfolio of approximately $497.4 million, consisting of whole loans and MBS, and an investment portfolio of $259.2 million.

(Complete details on the Corporation’s debt outstanding can be found on its website (www.kyhousing.org) in the audited financial statements and the quarterly secondary market disclosure reports.)

Similar to many housing finance agencies, the Corporation’s ability is issue debt has been difficult following the end of the NIBP program of the U.S. Treasury. At the same time, effective management of existing outstanding debt has grown somewhat in complexity. The Corporation currently redeems debt monthly including some cross calling. The Corporation has also employed sales proceeds of MBS securities to reduce outstanding debt. The Corporation has no remaining swap agreements or stand-by bond purchase agreements, but does provide self-liquidity for five (5) outstanding variable, taxable series.

Services Requested

The firm selected to perform services for the Corporation will be working primarily with the
Corporation’s finance staff. The engagement will include services for any issuance of debt by the Corporation during the period July 1, 2019 through June 30, 2020 and would involve a working partnership with an underwriting firm, a bond counsel firm and the Commonwealth Office of Financial Management. At KHC’s sole discretion, the contract may be extended an additional year (two extensions total are permitted), under the same terms and conditions.

The firm selected to provide quantitative services will be responsible for duties related to the issuance of debt that include, but are not limited to:
  • Bond issuance strategy analyses, for both new issuances and economic refunding transactions, including quantification and utilization of tax-exempt volume cap, taxable resources and the benefits/risks of structure options.
  • Analyses of economic refunding opportunities under optional redemption provisions, inclusive of pre-Ullman series.
  • Participation in transaction planning sessions, including conference calls, and review and comment on preliminary and final official statements.
  • Financing information included in the preliminary and official statements.
  • Management of 10-year rule, including genealogy, and 32-year rule analysis.
  • Calculation of bond and mortgage yields.
  • Preparation of preliminary and final rating agency cash flows in connection with each transaction and annually on a consolidated basis.

The firm selected to provide quantitative services will also be responsible for duties related to the ongoing financial management of the Corporation that include, but are not limited to:

  • Bond redemption strategy analyses, including cross calling between series.
  • Maintenance of mortgage database and updating of mortgage yield compliance calculations to ensure compliance with universal cap.
  • Analysis, consultation and critical review of Kentucky Housing-prepared ongoing mortgage pipeline yield compliance calculations and zero participations.
  • Consultation and analysis as needed on issues not directly related to specific debt issuance with rating agencies.
  • Assistance with projections used in preparation on annual indenture sources and uses and the Corporation’s budget.

Ancillary Services

Present and discuss any additional ancillary services and associated pricing, beyond those discussed above, that Respondent considers beneficial to the Corporation, if necessary.

NOTE: Services regarding arbitrage rebate calculations are being requested through a separate RFP and should not be considered part of the scope of the response to this RFP. However, the firm selected in this RFP process will be expected, at no additional charge, to provide advisory services that allow the Corporation to remain compliant with the SEC via the Independent Municipal Advisor Exemption.


Proposals must be received by 5:00 p.m., EDT, on Friday, March 29, 2019, to be considered.
Electronic copies will be accepted and are preferred. Faxed copies will not be accepted.
NOTE: PROPOSALS RECEIVED AFTER THE STATED DEADLINE WILL NOT BE ACCEPTED.

For more details, please review the full RFP for Professional Quantitative Services.

Submission of Proposals

Please direct the proposals to the attention of:

Lori Davis
Legal Services and Compliance Department
Kentucky Housing Corporation
Subject line to read: RFP Response – Quantitative Services