HomeMy WebLinkAbout27652-05-2025 - City Council - OrdinanceOrdinance No. 27652-05-2025
AN ORDINANCE INCREASING ESTIMATED RECEIPTS AND
APPROPRIATIONS IN THE GENERAL DEBT SERVICE FUND, IN THE
AMOUNT OF $1,500,000.00, FROM BOND PROCEEDS AND SUBJECT TO
THE SALE OF BONDS, FOR THE PURPOSE OF PAYING COST 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 2024-
2025 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 $1,500,000.00 , from bond
proceeds and subject to the sale of bonds, for the purpose of paying cost 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 27107-09-2024 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conflicting provisions of said prior ordinances and appropriations are hereby expressly repealed.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
Assistant City Attorney
ADOPTED AND EFFECTIVE: May 13, 2025
CITY SECRETARY
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Jannette S. Goodall
City Secretary
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City of Fort Worth, Texas
Mayor and Council Communication
DATE: 05/13/25 M&C FILE NUMBER: M&C 25-0405
LOG NAME: 13GENERAL PURPOSE BONDS SERIES 2025
SUBJECT
(ALL) Adopt Ordinance Authorizing Issuance and Sale of City of Fort Worth, Texas General Purpose Bonds, Series 2025, in an Aggregate
Principal Amount Not to Exceed $111,500,000.00; Establishing Parameters with Respect to Sale of the Bonds; Delegating Authority to Effect Sale
of the Bonds by Competitive Bid or Negotiated Sale; Authorizing Other Related Agreements; and Enacting Related Provisions; Adopt Ordinance
to Extend Period of Delegated Authority for General Purpose Refunding Bonds in Support of the Commercial Paper Program; Adopt
Appropriation Ordinance; and Amend Fiscal Year 2025 Adopted Budget
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It is recommended that the City Council:
1. Adopt the attached ordinance, which (i) authorizes the issuance of City of Fort Worth, Texas General Purpose Bonds, Series 2025, in an
aggregate principal amount not to exceed $111,500,000.00, for the purpose of funding projects within the 2022 bond program, and paying
the costs of issuance for the bonds; (ii) delegates to designated City officials authority to effect sale of the bonds by competitive bid or
negotiated sale as determined most advantageous based on current market conditions - subject to certain parameters as set forth in the
ordinance; (iii) authorizes execution of all related documents; (iv) provides 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)
enacts other provisions related thereto;
2. Adopt the attached appropriation ordinance increasing receipts and appropriations in the General Debt Service Fund in the amount of
$1,500,000.00, from bond proceeds and subject to the sale of bonds, for the purpose of paying cost of issuance, with such amount subject to
reduction to conform to final figures reflected in bond closing documents;
3. Adopt the attached ordinance (i) authorizing issuance and sale of City of Fort Worth, Texas General Purpose Refunding Bonds, in an
aggregate principal amount not to exceed $300,000,000.00 outstanding at any one time, to allow outstanding commercial paper to be
refunded/refinanced, if needed; (ii) approving the sale of the bonds subject to certain parameters being met; (iii) authorizing instruments
related to the issuance of the bonds; (iv) providing for levy, assessment, and collection of property tax sufficient to pay the principal and
interest on said bonds; and (v) extending delegated authority to effect the sale of refunding bonds through May 12, 2026; and
4. Amend the Fiscal Year 2025 Adopted Budget.
DISCUSSION:
The purpose of this Mayor and Council Communication (M&C) is to take actions associated with the City's general obligation, tax -backed debt.
Actions include adoption of an ordinance for issuance and sale of tax-exempt Series 2025 General Purpose Bonds and appropriation of proceeds
as part of the 2022 Bond Program and adoption of an updated refunding bond ordinance to support the general commercial paper (CP) program.
2022 Bond Proaram Issuance
Adoption of the attached bond ordinance associated with Recommendation 1 approves the issuance of bonds to provide $110,000,000.00 in
"new money" bonds from the 2022 Bond Program for the purpose of constructing streets and public mobility improvements; park and recreation
improvements; library system improvements; and police and fire public safety facilities.
The role of the current bond offering in the overall 2022 Bond Program is shown as follows
ate Of
Amount
Amount
Amount Now
Unissued
Vlection
purpose
Authorized
Previously Sold
Offered
Balance
May 07,
Streets
2022
$369,218,300.00 and
$125,177,000.00
$53,717,300.00 $190,324,000.00
Mobility
May 07,
$123,955,000.00 Parks and
$90,069,500.00
$20,000,000.00
$13,886,000.00
2022
Recreation
May 07,
$12505,200.00 Public
$10,823,500.00
$1,681,700.00
$0
2022
Library
May 07,
$39,321,000.00 Public
$19720,000.00
$19,601,000.00
$0
2022
Safety
Natural
May 07,
$15,000,000.00 Area and
$0
$15,000,000.00
$0
2022
Open
Space
II$560,000,000.00II I$245,790,000.00 I$110,000,000.00II$204,210,000.00
Staff is continuing to refine how project costs will be allocated as between proceeds of issued bonds and the Extendable Commercial Paper
(ECP) appropriation (M&C 22-0607; Ordinance 25675-08-2022). A separate M&C will be brought forward in the near future to appropriate the
proceeds of this sale and make any necessary adjustments and reallocations for the ECP appropriation authority to maximize use of all available
resources. To date no ECP notes have been issued for any 2022 Bond Program projects.
Staff anticipates that these bonds be sold through a competitive bid sale. However, to provide maximum flexibility to address any disruption
to market conditions, the attached ordinances authorizes the City Manager or the Chief Financial Officer to conduct either a competitive or
negotiated sale and 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, 2045; maximum true interest cost of 6.00%; and maximum net effective interest rate, calculated per chapter 1204 of the
Government Code, is 15.00%.
Rating agency meetings with Moody's, Fitch, and Kroll will be conducted prior to the sale of the bonds. Ratings are anticipated to be received the
week of May 12, 2025. Bids for the sale of the bonds are scheduled to be submitted on August 5, 2025. 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
of August 21, 2025.
The action in this M&C will amend the Fiscal Year (FY) 2025 Adopted Budget as approved in connection with Ordinance 27107-09-2024, Section
3. Debt Service Funds, as listed on page 14 as follows:
IFund / Department
FY2025 Adopted Budget
Budget Adjustment
Revised FY2025 Budgetll
(Budget Category
I
JProperty Tax
$171,682,486.00I
1
$171,682,486.00I
IIUse of Money and Property
$7,500,000.00II
1$7,500,000.00I
(Transfer from TIRZ #14 Trinity Lakes
$1,746,750.00
$1,746,750.00I
IIUse of Fund Balance
$154,817.00
$154,817.00I
lroceeds from Series 2025 General Purpose Bondsil
II $1,500,000.00I
$1,500,000.00I
IlTotal Revenues II
$181,084,053.00II !1
$182,584,053.00I
IlExpenditures .1
(Financial Management Services (Debt Obligation)
$178,103,653.00
$1,500,000.00
$179,603,653.00
(Transfer to Parking Debt Service
$2,980,400.00
$2,980,400.00
IlTotal Expenditures 1
$181,084,053.00I 1
$182,584,053.00I
Undated Refundina Bond Ordinance for CP Proaram
Recommendation 3 of this M&C also adopts an ordinance which provides the officials identified and designated as pricing officers with the
authority to issue up to $300,000,000.00 in General Purpose Refunding bonds if needed to facilitate the City's general obligation CP program. As
approved by City council in August 2022, the CP ordinance was adopted by M&C 22-0607 and authorized up to $300,000,000.00 in short-term
commercial paper notes for the general fund to be outstanding at any time and a corresponding refunding bond ordinance was adopted at the
same time. Because delegated authority to conduct the sale of bonds is time -limited under state bond law practice, the refunding bond ordinance
must be readopted to extend that authority.
Although it is not anticipated that commercial paper would actually be issued very regularly, the program authority provides the Bond Program
projects with liquidity and contracting authority so that staff can efficiently design and commence capital projects that are ultimately planned to be
financed out of long term debt to be issued at a later date. As the program is structured, an issue of commercial paper cannot have a maturity that
is later than the 270th day after the date on which the paper is initially issued. The refunding bond ordinance is an integral part of the CP program
because it provides delegated authority that allows refunding bonds to be issued, within certain parameters, in the unlikely event that commercial
paper is actually issued and cannot otherwise be retired or remarketed by the 270th day.
Adoption of the attached ordinance extends the delegated authority of the pricing officers to effect sale of all or any portion of up to
$300,000,000.00 in general purpose refunding bonds through May 12,2026, if needed, and only if the parameters in the ordinance are met.
Among the parameters the ordinance sets for issuance of general purpose refunding bonds is that the bonds bear a "net effective interest rate" (as
defined in and calculated in accordance with the provisions of Chapter 1204, Texas Government Code) that is no greater than 15.00%.
Because ongoing authority to issue refunding bonds is needed for proper operation of the CP program, an updated refunding bond ordinance will
be needed on an annual basis to extend the period of delegated authority. Staff anticipates bringing forward an updated refunding bond ordinance
each year as part of the City's annual debt issuance process.
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 tax-
exempt Series 2025 General Purpose Bonds will occur as required under the parameters set forth therein, that funds will be available in the
General Debt Service Fund as appropriated, and will be available to repay the debt when due and payable.
Submitted for Citv Manaaer's Office bv: Reginald Zeno 8517
Oriainatina Business Unit Head: Reginald Zeno 8517
Additional Information Contact: Anthony Rousseau 8338