M&C Review

COUNCIL ACTION:  Approved As Amended on 5/16/2017 - Ordinance No. 22721-05-2017, 22722-05-2017 & 22723-05-2017
DATE: 5/16/2017 REFERENCE NO.: G-19009 LOG NAME: 132017 TAX NOTES
CODE: G TYPE: NON-CONSENT PUBLIC HEARING: NO
SUBJECT:   Adopt Ordinance Authorizing Issuance and Approving Sale of Tax Notes in the Principal Amount of $23,085,000.00 $23,080,000.00 for the Purpose of Paying Obligations for Construction and for Purchase of Materials and Land Rights for Relocation of Trail Drive, for Relocation of the Park Service Center, and for Transportation Projects and Paying Costs of Issuance; Authorizing Execution of All Related Documents; and Ordaining Related Matters and Adopt Appropriation Ordinances (ALL COUNCIL DISTRICTS)
RECOMMENDATION:

It is recommended that the City Council:

1. Adopt the attached ordinance authorizing the issuance and approving sale of 2017 Tax Notes in the principal amount of $23,085,000.00 $23,080,000.00 for the purpose of paying contractual obligations for construction of public works and for purchase of materials, supplies, equipment, machinery, buildings, lands, and rights-of-way for the relocation of Trail Drive, relocation of the Park Service Center, and transportation projects and paying costs of issuance; authorizing execution of all related documents; and ordaining related matters, including providing for levy, assessment and collection of a tax sufficient to pay the interest on and principal of the notes if other revenues are not otherwise available and appropriated for those payments;

2. Adopt the attached ordinance increasing estimated receipts and appropriations in the 2017 Tax Note Project Fund by $23,085,000.00 $23,080,000.00, subject to the sale of tax notes and receipt of proceeds, to provide $3 million in funding for the Trail Drive relocation project, $10 million for the Park Service Center relocation project, and $10 million for Transportation projects; and

3. Adopt the attached appropriation ordinance revising the 2017 General Debt Service Fund Budget by reallocating funds from a planned fund balance contribution to pay debt service on the 2017 Tax Notes during Fiscal Year 2017.  
 
DISCUSSION:

The purpose of this Mayor and Council Communication (M&C) is to take actions to provide funding to accelerate delivery of certain strategic capital projects that are planned to commence within the next 12 months.

On April 27, 2017, the City sent invitations to 30 banks and financial institutions asking them to provide interest rates for these notes. The notes will be a tax-exempt obligation of the City, backed by the full-faith and credit of the City's taxing authority. The City will begin repayment of the seven-year notes on September 1, 2017, from the General Debt Service Fund, with repayment costs for these notes projected to be fully absorbed by revenue from the existing debt-rate portion of the City's property taxes without any increase in the rate. The notes will also be callable at the City's option in whole or in part on or after March 1, 2018.

Proceeds from sale of the notes will be used to pay issuance costs and to pay contractual obligations for the following projects:
  

Project

Amount

Park Service Center Relocation

$10,000,000.00

Trail Drive Relocation and Extension

$  3,000,000.00

Citywide Programmable - Street and Arterial Design and Study

$10,000,000.00

2017 Tax Note Cost of Issuance                                        

$        85,000.00

$        80,000.00

Total                                                                

$23,085,000.00

$23,080,000.00

  
The first two projects are interconnected, with relocation of the existing Park and Recreation maintenance facility from its current Crestline Drive location being necessary to allow for the extension and relocation of Trail Drive.  With the multipurpose Dickies Arena scheduled to open during the Fall of 2019, adding capacity on Trail Drive and providing alternative ingress/egress routes in and around the Will Rogers Memorial Center and Dickies Arena are critical to addressing anticipated traffic flow.  
  
The third project consists of preliminary design and study for critical road projects that Staff ranks among the City's highest priorities for funding and construction.  To the extent any of these projects are funded through a 2018 Bond Program, having the study and design work already prepared will allow for an accelerated delivery.
  
This M&C does not request approval of a contract with a business entity.
 
FISCAL INFORMATION/CERTIFICATION:

The Director of Finance certifies that upon adoption of the actions provided within this Mayor and Council Communication, the sale of the 2017 Tax Notes will proceed as necessary to provide funding in the 2017 Tax Note Capital Project Fund for the Trail Drive Relocation, Park Service Center Relocation, and Transportation Improvements.  Further, funds will be available within the General Debt Service Fund to make the Fiscal Year 2017 debt service payments.  

Funds will be requested in Fiscal Year 2018 General Debt Service Fund budget for payment obligations associated with this tax note.  

Prior to any expenditures being made, the participating departments have the responsibility to validate the availability of funds.
TO
    Fund Department
ID		 Account Project
ID		 Program Activity Budget
Year		 Reference #
(Chartfield 2)		 Amount

FROM
    Fund Department
ID		 Account Project
ID		 Program Activity Budget
Year		 Reference #
(Chartfield 2)		 Amount
Submitted for City Manager's Office by:
Susan Alanis (8312)
Originating Department Head:
Aaron Bovos (8517)
Additional Information Contact:
Alex Laufer (2268)
 
 
ATTACHMENTS
  2017 note ord draft 050517.doc
  note purchase agreement 042817.pdf
  Rec 2 - 2017 Tax Notes Project AO.docx
  Rec 3 - Debt Service Fund AO.docx