TO: Mayor and Members of City Council
THRU: Douglas J. Hewett, ICMA-CM, City Manager
FROM: Jay C. Toland, CMA - Chief Financial Officer/Assistant City Manager
DATE: June 27, 2022
RE:
Title
Order Authorizing $60,000,000 Public Safety Improvement Bonds,
Order Authorizing $25,000,000 Streets, Sidewalk, and Connectivity Bonds, and Order Authorizing $12,000,000 Housing Bonds
Discussions of Projected Projects
end
COUNCIL DISTRICT(S):
Council District(s)
All
b
Relationship To Strategic Plan:
Goal 4: Desirable place to live and recreate.
Executive Summary:
City Council is asked to consider the adoption of the attached bond orders for $60,000,000 Public Safety Improvement Bonds, $25,000,000 Streets, Sidewalk, and Connectivity Bonds, and $12,000,000 Housing Bonds, and to take several other actions required to proceed with related bond referendums on November 8, 2022
Staff will also be prepared to discuss projected projects (listed in detail in attached Slide Deck) and receive feedback on Council’s priority list of projects.
Background:
On April 28, 2022, City Council held a special meeting to discuss unfunded needs in the City. The City Council directed staff to initiate the process to set bond referendums for November 8, 2022, for not to exceed $60,000,000 in general obligation bonds for public safety improvement capital projects, not to exceed $25,000,000 in general obligation bonds for streets, sidewalk, and connectivity capital projects, and not to exceed $12,000,000 in general obligation bonds for affordable housing capital projects and funding the Housing Trust Fund.
On May 9, 2022, the City Council adopted a preliminary findings resolution authorizing staff to submit an application to the Local Government Commission for the proposed authorization of Public Safety Improvement Bonds, Streets, Sidewalk, and Connectivity Bonds, and Housing Bonds. Subsequent to May 9, 2022, staff received further guidance from City Council to change the proposal amounts to $60,000,000 in general obligation bonds for public safety improvement capital projects, $25,000,000 in general obligation bonds for streets, sidewalk, and connectivity capital projects, and $12,000,000 in general obligation bonds for affordable housing capital projects and funding the Housing Trust Fund. Additionally, draft copies of the statement of estimated interest and sworn statement of debt, both of which are referenced in the bonds orders and proceeds, are attached for your information. Please note that the sworn statement of debt, as required by the Local Government Bond Act, only includes the City’s general obligation bonds, the proposed bonds, and any unissued bonds authorized by previous bond order.
Issues/Analysis:
Several actions will be required in the next few months to proceed with the bond referendums in November.
Also, the estimated interest for the total amount of $97,000,000 in general obligation bonds, based on a 4.50% interest rate, semi-annual interest payments and a repayment period of 20 years, is $45,832,238
Budget Impact:
No budget impact at this time. If voters authorize the City Council to issue the aggregate amount of $97,000,000 in General Obligation Bonds in November, then the City Council would have 7 years to use that debt capacity. The City Council is not required to issue the authorized bonds or to use all of the authorized debt capacity. Any debt issued would have to be repaid
Options:
1. Staff recommends that City Council move to adopt the following:
(a) Adopt the Order Authorizing $60,000,000 Public Safety Improvement Bonds;
(b) Adopt the Order Authorizing $25,000,000 Streets, Sidewalk, and Connectivity Bonds;
(c) Adopt the Order Authorizing $12,000,000 Housing Bonds Order.
The City Council is requested to adopt the bonds orders in three separate actions, one motion for each bond order.
Note: Once the Orders are adopted, the Chief Financial Officer will present the Sworn Statement of Debt and Statement of Total Estimated Interest to the City Clerk. After that occurs, City Council may proceed with setting the public hearing.
(d) Set public hearing on the bond orders for 7:00 p.m. on August 8, 2022, in the Council Chambers at City Hall and direct the City Clerk to publish the bond orders in The Fayetteville Observer no later than six (6) days prior to the public hearing.
2) Do not adopt the bond orders and provide direction to staff
Recommended Action:
Approve Option 1 above.
Attachments:
Order Authorizing $60,000,000 Public Safety Improvement Bonds
Order Authorizing $25,000,000 Streets, Sidewalk, and Connectivity Bonds
Order Authorizing $12,000,000 Housing Bonds Order
Draft Sworn Statement of Debt
Draft Statement of Total Estimated Interest