Agenda No. 14.
CITY COUNCIL MEMORANDUM
| City Council Meeting: | July 23, 2019 |
| Department: | Finance |
| Subject: | Ordinance No. 19-B-17 - Consideration and approval of an Ordinance authorizing the issuance of “City of Schertz, Texas Combination Tax and Limited Pledge Revenue Certificates of Obligation, Series 2019”; providing for the payment of said certificates by the levy of an Ad Valorem Tax upon all taxable property within the City and further securing said certificates by a lien on and pledge of the pledged revenues of the system; providing the terms and conditions of said certificates and resolving other matters incident and relating to the issuance, payment, security, sale, and delivery of said certificates, including the approval and distribution of an official statement pertaining thereto; authorizing the execution of a paying agent/registrar agreement and an official bid form; complying with the requirements of the letter of representations previously executed with the depository trust company; authorizing the execution of any necessary engagement agreements with the City’s Financial Advisors and/or Bond Counsel; and providing an effective date. (M. Browne/J. Walters/M. McLiney) First and Final Reading |
BACKGROUND
The City previously authorized a Notice of Intention Resolution on May 14, 2019 declaring its intent to issue Certificates of Obligation (“CO”) to fund capital improvement projects. Having met the legal requirements of publication and having received no qualifying petition from any citizen, the City can now proceed with the consideration and issuance of the COs.
In keeping with the previously authorized Notice of Intention Resolution, the Ordinance makes clear that the City is issuing COs in an amount not-to-exceed $7,925,000 for the purposes of making road improvements ($3,050,000), purchasing a replacement aerial fire apparatus ($1,200,000) and sewer system improvements ($3,675,000).
The road improvement projects will be approved by council through construction contract awards at a later date.
The sewer improvement funding is intended to provide the additional capacity required to service homes in the Northcliffe subdivision and the surrounding areas.
On July 23th the City priced its COs and the Council will then consider an Ordinance approving the sale to the winning bidder of the COs at a competitive sale. The COs will be supported by both ad valorem taxes for general fund projects and the utility fund for projects related to utility system improvements. The authorization and sale of these COs will not require a tax rate increase or a utility rate increase.
In keeping with the previously authorized Notice of Intention Resolution, the Ordinance makes clear that the City is issuing COs in an amount not-to-exceed $7,925,000 for the purposes of making road improvements ($3,050,000), purchasing a replacement aerial fire apparatus ($1,200,000) and sewer system improvements ($3,675,000).
The road improvement projects will be approved by council through construction contract awards at a later date.
The sewer improvement funding is intended to provide the additional capacity required to service homes in the Northcliffe subdivision and the surrounding areas.
On July 23th the City priced its COs and the Council will then consider an Ordinance approving the sale to the winning bidder of the COs at a competitive sale. The COs will be supported by both ad valorem taxes for general fund projects and the utility fund for projects related to utility system improvements. The authorization and sale of these COs will not require a tax rate increase or a utility rate increase.
GOAL
To approve the bond sale to fund road improvement projects, to purchase a replacement aerial fire apparatus, and to make sewer system improvements.
COMMUNITY BENEFIT
The general road conditions will improve, the city will be equipped to continue to provide fire safety to industrial buildings, and the sewer system will continue to meet existing demands.
SUMMARY OF RECOMMENDED ACTION
Approve Ordinance 19-B-17 authorize the sale of bonds.
FISCAL IMPACT
This bond sale will allow the city to conduct $7,925,000 in additional infrastructure projects. It is currently projected this bond sale will not cause an increase in the debt tax rate or additional increases in the existing water and sewer rate plans.
RECOMMENDATION
Staff recommends approving Ordinance 19-B-17 for the sale of Certificates of Obligation with funds delivered on August 8th.
Please use the following language:
"I MOVE TO ADOPT AN ORDINANCE AUTHORIZING THE ISSUANCE OF “CITY OF SCHERTZ, TEXAS COMBINATION TAX AND LIMITED PLEDGE REVENUE CERTIFICATES OF OBLIGATION, SERIES 2019”
Please use the following language:
"I MOVE TO ADOPT AN ORDINANCE AUTHORIZING THE ISSUANCE OF “CITY OF SCHERTZ, TEXAS COMBINATION TAX AND LIMITED PLEDGE REVENUE CERTIFICATES OF OBLIGATION, SERIES 2019”