Coversheet

Item Coversheet


City of Georgetown, Texas City Council Regular Meeting May 11, 2021


SUBJECT: Consideration and possible action to approve on first and final reading an "Ordinance Authorizing the Issuance of City of Georgetown, Texas Combination Tax and Revenue Certificates Of Obligation, Series 2021A; Levying an Ad Valorem Tax and Pledging Certain Revenues in Support of the Certificates; Approving an Official Statement, a Paying Agent/Registrar Agreement and Other Related Documents; Awarding the Sale of the Certificates and Authorizing Other Matters Relating to the Certificates" -- Leigh Wallace, Finance Director


ITEM SUMMARY: Historically, the City has sold water and electric utility debt for capital infrastructure and equipment as revenue bonds with their own co-pledged revenues and bond rating. Due to Winter Storm Uri in February 2021, there has been interruption in the stability of the energy market leading to increased uncertainty around market participants and issuers. Many of the rating agencies put issuers on negative credit watch, including the City. The City’s Financial Advisor recommended and Council approved the change to selling this year’s utility capital project debt as Certificates of Obligation. This change helps the utility secure the best interest rate and the best term length for these projects, while also relieving pressure on the revenue debt coverage ratio. This item is to approve the sale of certificates of obligation for the following purposes: Certificates of Obligation Series 2021A Project / Term / Amount Revenue Electric Consultant Engineer 20 250,000.00 Downtown Overhead Rehab 20 400,000.00 Electric 3 Reel Turret Trailer 10 105,000.00 Electric Line Design Software Replacement 10 200,000.00 Electric Underground Pulling Trailer 10 193,000.00 Electric Vehicles 7 372,000.00 New Development 20 3,747,000.00 Power Quality Imp 20 50,000.00 Replacement Vehicles 7 81,000.00 Ronald Reagan- Glasscock Feeder extension along HWY 195- Phase 1 20 560,000.00 Ronald Reagan- Glasscock Feeder extension along HWY 195- Phase 2 20 592,000.00 Sectionalization Imp 20 100,000.00 Electric Total 6,650,000.00 Water Round Rock Elevated Storage Tank 20 3,500,000.00 Round Rock Supply Line 20 3,200,000.00 Round Rock Supply Pump Station 20 2,500,000.00 Southside Water Treatment Plant Rehabilitation 20 2,250,000.00 Southwest Bypass Water Line 20 1,800,000.00 Tank Rehabilitation 20 750,000.00 Aviation Drive Waterline 20 600,000.00 Lakeway Drive Waterline 20 1,700,000.00 Water Total 16,300,000.00 Certificates of Obligation Series 2021A Total 22,950,000.00 Estimated Issuance Costs: 550,000.00 Total Estimated Certificates of Obligation: 23,500,000.00


FINANCIAL IMPACT: There is no anticipated change to the Interest & Sinking portion of the tax rate due to this debt issue. This entire debt issuance is self-supported by current Water and Electric rates. COMMENTS Actual interest rates for this debt issue will not be determined until just prior to the reading of the ordinance at the Council meeting on May 11, 2021. The City will receive the proceeds June 3, 2021. Please note all ordinances will be approved and effective on First Reading in accordance with Section 1201.028, Texas Government Code.


SUBMITTED BY: Sharon Parker

ATTACHMENTS:

Description

Proposed Ordinance