HomeMy WebLinkAboutOrdinance 24718-02-2021 ORDINANCE NO. 24718-02-2021
DIRECTING PUBLICATION OF NOTICE OF INTENTION TO ISSUE
COMBINATION TAX AND REVENUE CERTIFICATES OF
OBLIGATION; AND ORDAINING OTHER MATTERS RELATING TO
THE SUBJECT
WHEREAS, the City of Fort Worth expects to pay expenditures in connection with the
design, planning, acquisition and construction of the projects described in "Exhibit A" to this
Ordinance prior to the issuance of the Certificates of Obligation hereinafter described; and
WHEREAS, the City Council hereby finds, considers and declares that the
reimbursement of the payment by the City of such expenditures will be appropriate and
consistent with the lawful objectives of the City and, as such, chooses to declare its intention, in
accordance with the provisions of Section 1.150-2 of the U.S. Treasury Regulations, to
reimburse itself for such payments at such time as it issues the hereinafter described Certificates
of Obligation; and
WHEREAS, it is hereby officially found and determined that the meeting at which this
Ordinance was considered was open to the public, and public notice of the time, place and
purpose of said meeting was given, all as required by Chapter 551, Texas Government Code.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH,TEXAS:
Section 1. That attached hereto and marked "Exhibit A" is a form of notice, the form and
substance of which are hereby passed and approved.
Section 2. That the City Manager shall cause said notice to be (a) published, in
substantially the form attached hereto, in a newspaper of general circulation in the City of Fort
Worth, Texas, for two consecutive weeks, the date of the first publication to be before the forty-
fifth (45th) day before the day tentatively proposed for authorizing the issuance of the
Certificates of Obligation as shown in said notice and (b) posted, in substantially the form
attached hereto, continuously on the City's internet website for at least forty-five (45) days
before the day tentatively proposed for authorizing the issuance of the Certificates of Obligation
as shown in said notice.
Section 3. That the improvements to be financed with proceeds from the proposed
Certificates of Obligation are to be used for the purposes described in the attached Notice of
Intention.
Section 4. That attached hereto as "Schedule I" is a list of outstanding debt obligations of
the City which the City hereby designates as self-supporting debt for purposes of Subchapter C
of Chapter 271, Texas Local Government Code, as amended.
Section 5. That all costs to be reimbursed pursuant to this Ordinance will be capital
expenditures; the proposed Certificates of Obligation shall be issued within 18 months of the
later of(i) the date the expenditures are paid or (ii) the date on which the property, with respect
to which such expenditures were made, is placed in service; and the foregoing notwithstanding,
the Certificates of Obligation will not be issued pursuant to this Ordinance on a date that is more
than three years after the date any expenditure which is to be reimbursed is paid.
Section 6. That this Ordinance shall be effective immediately from and after its passage
in accordance with the provisions of Section 1201.028, Texas Government Code, and it is
accordingly so ordained.
ADOPTED AND EFFECTIVE February 23, 2021.
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Signature Page—Ordinance Authorizing Publication of Notice of Intent to Issue Certificates of Obligation
EXHIBIT A
NOTICE OF INTENTION TO ISSUE
COMBINATION TAX AND REVENUE
CERTIFICATES OF OBLIGATION
NOTICE IS HEREBY GIVEN that it is the intention of the City Council of the City of
Fort Worth, Texas, to issue one or more series of the interest bearing certificates of obligation of
the City to be entitled "City of Fort Worth, Texas Combination Tax and Revenue Certificates of
Obligation", for the purpose of paying contractual obligations to be incurred by the City, to-wit,
contractual obligations incurred in connection with the financing of improvements to Trinity
Boulevard within the City, and the payment of fiscal, engineering and legal fees incurred in
connection therewith. The City Council tentatively proposes to authorize the issuance of said
series (one or more) of Certificates of Obligation at its regular meeting place in the City Hall at a
meeting to commence at 7:00 o'clock,p.m., on the 13th day of April, 2021. In the event the City
Council will be unable to meet at City Hall on April 13, 2021, the City will post information on
its website for attending the meeting by telephone, teleconference, or other electronic means.
The maximum amount of Certificates of Obligation indebtedness that may be authorized to be
sold on said date for such purposes described above is $18,500,000. The City Council presently
proposes to provide for payment of said series (one or more) of Certificates of Obligation from
the levy of ad valorem taxes and from a limited pledge (not to exceed $1,000) of surplus
revenues derived from the operation of the City's water and sewer system.
In accordance with the provisions of Subchapter C of Chapter 271, Texas Local
Government Code, as amended ("Chapter 271"), the following information has been provided
by the City (excludes $75,125,000 principal amount of outstanding debt obligations the City has
designated as self-supporting and which the City reasonably expects to pay from revenue sources
other than ad valorem taxes; provided, however, that in the event such self-supporting revenue
sources are insufficient to pay debt service, the City is obligated to levy ad valorem taxes to pay
such debt obligations): (i) the principal amount of all outstanding debt obligations of the City is
$789,560,000; (ii) the current combined principal and interest required to pay all outstanding
debt obligations of the City on time and in full is $960,567,908; (iii) the maximum principal
amount of the certificates of obligation to be authorized is $18,500,000; (iv) the estimated
combined principal and interest required to pay the certificates of obligation to be authorized on
time and in full is $20,579,708; (v)the maximum interest rate for the certificates may not exceed
the maximum legal interest rate; and (vi) the maximum maturity date of the certificates of
obligation to be authorized is September 1, 2033. The ordinance designating certain outstanding
debt obligations of the City as self-supporting for purposes of Chapter 271 is available upon
request to the City at the address noted above.
CITY OF FORT WORTH, TEXAS
/s/Betsy Price
Mayor
SCHEDULEI
CITY OF FORT WORTH, TEXAS
Self-Supporting Debt
The City designates all or a portion of the following outstanding debt obligations of the City as
self-supporting debt for purposes of Subchapter C of Chapter 271, Texas Local Government
Code, as amended:
Combination Tax and Revenue Certificates of Obligation, Taxable Series 201313;
General Purpose Refunding and Improvement Bonds, Series 2013;
General Purpose Refunding Bonds, Series 2014;
General Purpose Refunding Bonds, Series 2015;
General Purpose Refunding and Improvement Bonds, Series 2015A;
General Purpose Refunding and Improvement Bonds, Series 2016; and
General Purpose Refunding and Improvement Bonds, Series 2020
THE STATE OF TEXAS
COUNTIES OF TARRANT, DENTON, PARKER, WISE AND JOHNSON
CITY OF FORT WORTH
I, Mary Kayser, City Secretary of the City of Fort Worth, in the State of Texas, do hereby
certify that I have compared the attached and foregoing excerpt from the minutes of the regular,
open, public meeting of the City Council of the City of Fort Worth, Texas held on February 16,
2021, and of the ordinance authorizing the publication of notice of intention to issue Certificates
of Obligation, which was duly passed at said meeting, and that said copy is a true and correct
copy of said excerpt and the whole of said ordinance. Said meeting was open to the public, and
public notice of the time, place, and purpose of said meeting was given, all as required by
Chapter 551, Texas Government Code, as amended.
In testimony whereof, I have set my hand and have hereunto affixed the seal of said City
of Fort Worth,this 21"day of June, 2021.
City Secret e
City of Fort Worth, Texas
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City of Fort Worth,Texas
Mayor and Council Communication
DATE: 02/16/21 M&C FILE NUMBER: M&C 21-0113
LOG NAME: 13NOTICE OF INTENTION-SERIES 2021 CERTIFICATES OF OBLIGATION
SUBJECT
(CD 5)Adopt Ordinance Directing Publication of Notice of Intention to Issue Combination Tax and Revenue Certificates of Obligation in an Amount
Not to Exceed$18,500,000.00 for Improvements to Trinity Boulevard and Expressing Intent to Reimburse Initial Project Expenditures from
Proceeds if Debt Is Issued
RECOMMENDATION:
It is recommended that the City Council adopt the attached ordinance,which directs publication of notice of the City's intention to issue
Combination Tax and Revenue Certificates of Obligation,Series 2021, in an amount not to exceed$18,500,000.00 for improvements to Trinity
Boulevard;approves the form of notice;directs notice to be published in accordance with state law;and expresses official intent for the City to
reimburse itself from proceeds of the debt sale,if debt is issued,for project related expenditures incurred prior to issuance.
DISCUSSION:
The purpose of this Mayor and Council Communication(M&C)is to take actions associated with issuing Certificates of Obligation(C.O.$)for
improvements to Trinity Boulevard.
Under state law the City Council has the authority to issue C.O.s without explicit prior voter approval,provided that notice must be published and
the public provided an opportunity to petition for an election to be held. In addition,the City has established financial policies governing the
issuance of C.O.s that limits their use to finance public improvements in special circumstances and only after determining the City's ability to
assume additional debt. An example of special circumstances is a situation,such as the one posed here,where it would be more economical to
issue C.O.s rather than revenue bonds.
The Trinity Boulevard project,which includes certain improvements to road,sidewalk,and stormwater infrastructure,qualifies for C.O.financing
under both state law and City policy. The Board of the adjacent Tax Increment Reinvestment Zone No. 14(Trinity Lakes)(TIF)has authorized
participation in the project,and the City Council previously approved a TIF development agreement in the amount of$18,500,000.00 for the project
(M&C 20-0939).
Although the City anticipates the entire cost of the C.O.s to be repaid from TIF revenues,staff is recommending issuance of combination tax and
revenue C.O.s with the City's taxing authority and a limited pledge of surplus water and sewer revenues(not to exceed$1,000.00). Pledging the
City's tax authority will allow the debt financing to achieve a more favorable interest rate. Making a limited pledge of surplus water and sewer
revenues meets state law provisions that require identification of a revenue source when using revenue as a potential source of repayment.
Upon City Council approval,the City Manager shall publish the initial Notice of Intention on February 17 or 18,2021 and will post the notice on the
City's website at the same time.The second Notice of Intention will be published on the same day of the week following the first notice.
An ordinance to authorize issuance and delegate authority for the sale of the C.O.s is scheduled to be brought back for Council consideration on
April 6,2021.The C.O.s are intended to be sold on a competitive basis with closing and delivery of the C.O.funds anticipated to occur in the late
spring/early summer timeframe.
In addition to setting the form of notice and directing its publication,adoption of the attached ordinance would also serve as the City Council's
adoption of a formal statement of intent to reimburse preliminary costs for the project out of the issuance from the certificates. This aspect of the
ordinance does not obligate the City to sell C.O.s,but preserves the ability for the City to reimburse itself from tax-exempt debt proceeds if it does.
This mechanism allows the project to continue forward until debt proceeds are available. A separate M&C to appropriate an interim funding
source will be brought forward for Council consideration;any expenses incurred against that initial funding source would be repaid out of debt
proceeds following issuance,sale,and receipt of proceeds.
This project is located in COUNCIL DISTRICT 5.
A Form 1295 is not required because:This M&C does not request approval of a contract with a business entity.
FISCAL INFORMATION/CERTIFICATION:
The Director of Finance certifies that approval of this recommendation will have no material effect on City funds.
Submitted for City Manager's Office by: Jay Chapa 5804
Originating Business Unit Head: Reginald Zeno 8517
Additional Information Contact: Alex Laufer 2268
Expedited