CC MEETING: May 7, 2013
DATE: April 25, 2013
TO: Leonard Martin, City Manager
FROM: Cesar J. Molina, Jr., P.E., Director of Engineering
Title
Discuss Bond Election.
Body
BACKGROUND:
At the April 2013 Retreat, City Council directed staff to begin working immediately towards a November 2013 bond election. Staff has developed a schedule to engage the Capital Improvements Project Advisory Committee (CIPAC) in assisting with the prioritization of projects.
Before proceeding on this effort, staff needs further direction from Council. At the Retreat, Council directed staff to develop three funding scenarios for the bond election. These scenarios are based upon determining total bond capacity based on three debt service levels. The scenarios would be based upon a tax rate allocation of 20.6 cents, 21.6 cents and 22.6 cents. These different scenarios will determine the overall debt capacity and the amount of funds that can be authorized. The current tax rate funding level of 22.6 cents will yield a bond capacity of $60 million. Staff and CIPAC also need guidance on the appropriate amount of funding to use for the major project categories. As a point of reference, in the 2003 bond election City Council directed staff to allocate approximately 80 percent of available debt capacity towards infrastructure projects, with the balance applied towards culture, leisure and public safety projects. The actual amounts for the 2003 bond election are as follows:
Infrastructure $65,400,000 83.4 percent
Streets $50,000,000
Drainage $15,400,000
Public Safety/Parks $13,050,000 16.6 percent
Public Safety $750,000
Parks $12,300,000
Total $78,450,000
In the 2007 bond election City Council directed staff to allocate no less than 70 percent of the available funds toward infrastructure projects, with the balance applied towards other needs. The actual amounts for the 2007 bond election are as follows:
Infrastructure $38,750,000 71.1 percent
Streets $27,550,000
Drainage $9,200,000
Economic Development $2,000,000
Public Safety/Parks/Facilities $15,750,000 28.9 percent
Public Safety $3,950,000
Parks $6,350,000
Facilities $5,450,000
Total $54,500,000
The recently completed Infrastructure Report Card indicates that, in order to provide a sustainable community infrastructure network, approximately $30 million per year should be allocated to surface infrastructure (streets, alleys, and sidewalks) projects. Over the last 12 months (thru March 31, 2013), the City has invested over $12.3 million on infrastructure projects. Therefore, staff recommends that at least 80 percent of the expected $60 million bond election authorization be allocated to surface infrastructure improvements. Suggested funding levels would be as follows:
Infrastructure $48,000,000
Public Safety/Parks/Facilities $12,000,000
Project Selection
Staff has developed a plan to vet all of the major categories of projects by June 26, 2013 with the involvement of CIPAC. However, staff would like to have two opportunities to discuss CIPAC's recommendation with Council. Staff is further constrained by the state law requirement that bond election language be sent to, and approved by the Attorney General's Office prior to calling the bond election. Staff understands that the AG's office needs to receive all of the City's election information by July 16, 2013. To meet this schedule, the projects need to be approved by Council and submitted to the City's bond counsel by the morning of July 15 in order to allow adequate time to draft the language and submit the appropriate paperwork. Staff is requesting that Council add a second meeting in July to allow for a bond election worksession and to provide sufficient time to discuss the recommendations with Council.
STAFF RECOMMENDATION/ACTION DESIRED:
Staff desires to obtain general direction on the amount of funds to allocate to the major project categories for the upcoming bond election.