ITEM #: 8.
DATE: 11/18/2024
AI #:2326 |
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CITY COUNCIL ACTION REPORT
| SUBJECT: |
ORDERING THE SALE OF THE CITY OF GOODYEAR, ARIZONA, SUBORDINATE LIEN WATER AND SEWER REVENUE OBLIGATIONS, SERIES 2025
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| STAFF PRESENTER(S): |
Jared Askelson, Finance Director |
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| SUMMARY |
This action will authorize bonds to be issued for the purpose of constructing water and wastewater infrastructure. Approval of this Eighth Supplemental Resolution would (i) further supplement and amend the City’s Resolution No. 99-662 (the “Master Resolution”), dated January 25, 1999 (which authorizes the incurrence of water and sewer revenue refunding and improvement indebtedness); (ii) authorize the execution and delivery of city of Goodyear, Arizona, Subordinate Lien Water and Sewer Revenue Obligations, Series 2025; (iii) approve and authorize the execution and delivery of a Trust Agreement, an Agreement, a Purchase Contract, a Continuing Disclosure Certificate, an Official Statement and related documents, all related to the Series 2025 Obligations; and (iv) delegate certain authority to the Finance Director and other officers of the City relating to the Series 2025 Obligations.
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| STRATEGIC PLAN ALIGNMENT |
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| RECOMMENDATION |
| ADOPT RESOLUTION NO. 2024-2436 EIGHTH SUPPLEMENTAL RESOLUTION SUPPLEMENTING AND AMENDING THE CITY OF GOODYEAR, ARIZONA, RESOLUTION NO. 99-662, DATED JANUARY 25, 1999, AS THEREAFTER AMENDED AND SUPPLEMENTED (WHICH AUTHORIZES THE INCURRENCE OF WATER AND SEWER REVENUE REFUNDING AND IMPROVEMENT INDEBTEDNESS); AUTHORIZING THE EXECUTION AND DELIVERY OF CITY OF GOODYEAR, ARIZONA SUBORDINATE LIEN WATER AND SEWER REVENUE OBLIGATIONS, SERIES 2025, AND THE SALE THEREOF TO THE PURCHASER THEREOF; PRESCRIBING THE FORM AND OTHER DETAILS OF THE SERIES 2025 OBLIGATIONS; PROVIDING THAT SUCH SERIES 2025 OBLIGATIONS SHALL BE SUBORDINATE OBLIGATIONS AS DEFINED IN RESOLUTION NO. 99-662, AS AMENDED AND SUPPLEMENTED; APPROVING AND AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST AGREEMENT, AN AGREEMENT, AN OBLIGATION PURCHASE AGREEMENT, A CONTINUING DISCLOSURE CERTIFICATE, AN OFFICIAL STATEMENT AND FORMS OF RELATED DOCUMENTS; DELEGATING CERTAIN AUTHORITY TO THE FINANCE DIRECTOR AND OTHER OFFICERS OF THE CITY; AND AUTHORIZING THE TAKING OF ALL OTHER ACTIONS NECESSARY TO THE CONSUMMATION OF THE TRANSACTION CONTEMPLATED BY THIS EIGHTH SUPPLEMENTAL RESOLUTION. (Jared Askelson, Finance Director) |
| FISCAL IMPACT |
| The issuance of obligations for the purposes of funding water and wastewater infrastructure was included as a part of the fiscal year 2025 budget. The obligations will generate approximately $55 million for the Rainbow Valley Water Reclamation Facility Design and Expansion, Brine Disposal, associated Improvements to the Palo Verde Nuclear Power Generating Station, and the costs of issuing the obligations. The debt service payments have been scheduled to reduce potential rate spikes in the water and wastewater enterprises and to spread the cost in time across the useful life of the infrastructure. Debt service payments will average $4.7 million per year for twenty years. The debt service payments will be made from a combination of water and wastewater enterprise revenues and development impact fees. |
| BACKGROUND AND PREVIOUS ACTIONS |
| The Series 2025 Obligations will be on parity with the Existing Subordinate Parity Obligations described in Resolution 2024-2436; however, such Series 2025 Obligations are subordinate to the City’s “Senior Bonds” (as such term is defined in the Master Resolution), which are currently the city of Goodyear, Arizona Water and Sewer Revenue Refunding Bonds, Series 2009, outstanding in the aggregate principal amount of $325,000, and the $1,600,863 aggregate outstanding principal amount of the Loan Agreement #91A129-10 between WIFA and the City dated August 28, 2009. |
| STAFF ANALYSIS |
It is anticipated that the Series 2025 Obligations will be issued in an aggregate original principal amount of $54,920,000 with a final maturity date of July 1, 2044, and an estimated interest rate of 5%. This item will set a maximum principal amount of the obligations not to exceed $62,000,000, with a yield not exceeding 6%, and a maximum maturity not to exceed July 1, 2049. These thresholds will allow flexibility to maximize the financial benefit to the City when the bonds enter the market.
The finance staff and bond counsel have reviewed the proposed execution and delivery of city of Goodyear, Arizona, Subordinate Lien Water and Sewer Revenue Obligations, Series 2025, and the sale thereof and find that they are in compliance with state law and City policies.
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