HomeMy WebLinkAboutOrdinance 25471-04-2022 ORDINANCE NO.25471-04-2022
AN ORDINANCE INCREASING ESTIMATED RECEIPTS AND
APPROPRIATIONS IN THE GENERAL DEBT SERVICE FUND, IN THE
AMOUNT OF$39,770,000.00,SUBJECT TO THE SALE OF BONDS AND RECEIPT
OF PROCEEDS,FOR THE PURPOSE OF FUNDING THE REQUIRED ESCROW
TO REFUND EXISTING DEBT AND PAYING THE COSTS OF ISSUANCE,WITH
SUCH AMOUNT SUBJECT TO REDUCTION TO CONFORM TO FINAL
FIGURES REFLECTED IN BOND CLOSING DOCUMENTS;PROVIDING FOR A
SEVERABILITY CLAUSE; MAKING THIS ORDINANCE CUMULATIVE OF
PRIOR ORDINANCES; REPEALING ALL ORDINANCES IN CONFLICT
HEREWITH;AND PROVIDING AN EFFECTIVE DATE.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH,
TEXAS:
SECTION 1.
That in addition to those amounts allocated to the various City departments for Fiscal Year 2021-2022 in the
Budget of the City Manager,there shall also be increased estimated receipts and appropriations in the General
Debt Service Fund in the amount of$39,770,000.00,subject to the sale of bonds and receipt of proceeds,for
the purpose of funding the required escrow to refund existing debt and paying the costs of issuance,with such
amount subject to reduction to conform to final figures reflected in bond closing documents).
SECTION 2.
That should any portion,section or part of a section of this ordinance be declared invalid,inoperative or void
for any reason by a court of competent jurisdiction,such decision,opinion or judgment shall in no way impair
the remaining portions,sections,or parts of sections of this ordinance,which said remaining provisions shall
be and remain in full force and effect.
SECTION 3.
That this ordinance shall be cumulative of Ordinance 25073-09-2021 and all other ordinances and
appropriations amending the same except in those instances where the provisions of this ordinance are in
direct conflict with such other ordinances and appropriations,in which instance said conflicting provisions of
said prior ordinances and appropriations are hereby expressly repealed.
SECTION 4.
This ordinance shall take effect upon adoption.
APPROVED AS TO FORM AND LEGALITY: CITY SECRETARY
Jannette s.Goodall(Apr 14,2022 16:47 CDT)
Assistant City Attorney Jannette S. Goodall
U j • �.4
ADOPTED AND EFFECTIVE:April 12,2022 _ '
City of Fort Worth, Texas
Mayor and Council Communication
DATE: 04/12/22 M&C FILE NUMBER: M&C 22-0266
LOG NAME: 13TAXABLE SERIES 2022 GENERAL PURPOSE REFUNDING BONDS
SUBJECT
(ALL)Adopt Attached Ordinance Authorizing Issuance and Sale of City of Fort Worth, Texas General Purpose Refunding Bonds,Taxable Series
2022, in an Aggregate Principal Amount Not to Exceed$39,770,000.00; Establishing Parameters with Respect to Sale of the Bonds; Delegating
Authority to Effect Sale of the Bonds by Competitive Bid or Negotiated Sale;Authorizing Escrow and Other Related Agreements;and Enacting
Related Provisions; and Adopt Attached Appropriation Ordinance,and Amend the Fiscal Year 2022 Adopted Budget
RECOMMENDATION:
It is recommended that the City Council:
1. Adopt the attached ordinance(i)authorizing the issuance of City of Fort Worth,Texas General Purpose Refunding Bonds,Taxable Series
2022,in an aggregate principal amount not to exceed$39,770,000.00,for the purpose of refunding identified outstanding debt and paying
the cost of issuance for the bonds, (ii)delegating to designated City officials authority to effect sale of the bonds-subject to certain
parameters as set forth in the ordinance-by competitive bid or negotiated sale as determined most advantageous based on current market
conditions; (iii)authorizing execution of escrow agreement related to retirement of the refunded obligations and other instruments related to
the issuance of the bonds; (iv)providing for levy,assessment,and collection of a property tax sufficient to pay the interest on and principal of
the bonds if other revenues are not otherwise available and appropriated for those payments;and(v)ordaining other matters related to
issuance and sale of the bonds;
2. Adopt the attached ordinance increasing estimated receipts and appropriations in the General Debt Service Fund in the amount of
$39,770,000.00,subject to the sale of bonds and receipt of proceeds,for the purpose of funding the required escrow to refund existing debt
and paying the costs of issuance,with such amount subject to reduction to conform to final figures reflected in bond closing documents;and
3. Amend the Fiscal Year 2022 Adopted Budget.
DISCUSSION:
The purpose of this Mayor and Council Communication (M&C)is to approve the issuance and sale of taxable Series 2022 General Purpose
Refunding Bonds and to appropriate the proceeds.This action will allow refinancing and restructuring of existing debt obligations, including
the Series 2013A Certificates of Obligation (the Series 2013A CO's), Series 2013C Certificates of Obligation (the Series 2013C CO's), and the
Series 2013C General Purpose Bonds(the Series 2013 GO's),to achieve debt service savings.
It is the City's practice to achieve positive debt service savings through refinancing when the opportunity presents itself.Staff and the City's Co-
Financial Advisors, PFM Financial Advisors LLC and Tijerina Galvan Lawrence LLC,are recommending that the Mayor and Council refund the
callable portions of the Series 2013A CO's, Series 2013C CO's, and Series 2013 GO's with a combined par amount outstanding of
$36,775,000.00.The actual savings amount will not be determined until the time bids are received.However,in accordance with the City's
Financial Management Policy Statements,the ordinance provides that the refunding debt shall not be sold unless the sale will result in net present
value savings of at least 3.50%of the par amount being refunded.Currently,the refunding is projected to provide 8.22%net present value savings,
or$3,024,571.00.
Due to current market conditions, public issuers are struggling to price favorably in the competitive market.In an effort to mitigate this downside
risk,the ordinance provides delegated authority to the City Manager and Chief Financial Officer, individually,to effect the sale of the bonds.This
includes authority to seek not only competitive bids for the sale of the bonds authorized but also a negotiated sale conducted as either a public or
private offering negotiated through a purchase agreement with Underwriters. Staff is recommending that these bonds be sold with the City
Manager or the Chief Financial Officer having authority to approve the terms of the sale so long as those terms come within the parameters set
forth in the Council-adopted ordinance. Key parameters include: Bonds must be rated in one of the four highest generic rating categories(BBB or
higher);the maximum maturity is March 1,2042; maximum true interest cost of 5.00%;and maximum net effective interest rate, calculated per
chapter 1204 of the Government Code,is 15.0%. Rating agency calls with Fitch,Moody's, and Kroll will be conducted prior to the sale of the
bonds. Bids for the sale of the bonds are scheduled to be submitted on or about May 17,2022.Subsequent to accepting the best bid and
awarding the sale of the bonds,the City will seek approval of the debt transactions from the Texas Attorney General with an estimated closing date
on or around June 14,2022.
The attached appropriation ordinance reflects the maximum appropriation amount for bond proceeds for the refunded debt.The structure of the
attached appropriation accommodates variables associated with sale of debt under delegated authority,such as the uncertain final interest rate to
be achieved and the possibility of a premium or discount being associated with the sale of the bonds.To the extent numbers at closing are less
than those reflected in the ordinance,the available appropriation amount will be reduced as needed to reflect final figures based on the closing
documents to ensure appropriations do not exceed actuals.
The action in this M&C will amend the Fiscal Year 2022 Adopted Budget as approved in connection with Ordinance 25073-09-2021, Section 3.
Debt Service Funds,as listed on page 11 as follows:
Fund/Department FY2022 Budget Revised FY2022
Adopted Adjustment Budget
Budget Category Budget
General Debt Service Fund
Revenues
Property Tax $121,072,221.00
$121,072,221.00
Use of Money and Property $3,074,790.00
$3,074,790.00
Transfer from CCPD $2,713,347.00
$2,713,347.00
Transfer from TIRZ#14 $1,329,084.00
$1,329,084.00
Proceeds from series 2022 refunding
bonds $39,770,000.00 $39,770,000.00
Total Revenues $167,959,442.00
$128,189,442.00$39,770,000.00
Expenditures
Financial Management Services(Debt
Obligation) $128,189,442.00$39,770,000.00 $167,959,442.00
Total Expenditures $167,959,442.00
$128,189,442.00$39,7701000.00
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 upon approval of the above recommendations and adoption of the attached ordinances,the sale of the
taxable Series 2022 General Purpose Refunding Bonds will occur as required under the parameters set forth therein,that funds will be available in
the General Debt Service Funds as appropriated,and will be available to repay the debt when due and payable.
Submitted for CitXManager's Office bk Reginald Zeno 8517
Originating Business Unit Head: Reginald Zeno 8517
Additional Information Contact: Anthony Rousseau 8338
Expedited