Title
Conduct a public hearing regarding the issuance of City of Pflugerville, Texas Combination Tax and Limited Revenue Certificates of Obligation, Series 2017A and consideration and action with respect to "Ordinance Authorizing the Issuance of City of Pflugerville, Texas Combination Tax and Limited Revenue Certificates of Obligation, Series 2017A; Authorizing the Levy of an Ad Valorem Tax and the Pledge of Certain Net Revenues in Support of the Certificates; Approving an Official Statement, a Purchase Agreement and a Paying Agent/Registrar Agreement; and Authorizing Other Matters Related to the Certificates." (Utility - wastewater capital improvements)
Summary
The proposed certificates of obligation will be used to fund utility capital improvement projects including: expansion of the Central Wastewater Treatment Plant, New Sweden Package Treatment Plant (Phase 1), and West SH130 Interceptor (Phase 1). The utility fund capital improvements schedule is attached to the agenda item. By approving this ordinance, the City is authorizing the issuance of certificates of obligation in an amount not to exceed $19,200,000, including all project and bond issuance costs.
The attached ordinance has been prepared by bond counsel. The pricing terms of the certificates will be finalized and incorporated into the ordinance on November 14th after the obligations have been priced. Moody's Investor Services and S&P Global Ratings have both assigned ratings on this debt issuance. Moody's has maintained the City's Aa1 rating and S&P has maintained the City's AA rating. Mr. Terrell Palmer, the city's financial advisor, was instrumental in working with the staff last summer to have the City's bond ratings reviewed, and subsequently upgraded. This upgrade will have a positive effect on the interest rate paid by the city on this issuance.
Mr. Terrell Palmer, the City's financial advisor with Hilltop Securities and Mr. Richard Donoghue, City's bond counsel with McCall, Parkhurst, and Horton will be in attendance to answer any questions that City Council may have.
Prior City Council Action
On September 12, 2017, the City Council approved a Notice of Intent Resolution for this issuance of Certificates of Obligation, Series 2017A. On October 24, 2017, the City Council approved a draft of the Preliminary Official Statement. A tentative financing schedule is attached to this agenda item.
Deadline for City Council Action
In order to close on the bonds and receive the funds by December 12, 2017, this public hearing must be held and the ordinance must be adopted on November 14, 2017.
Fiscal Impact
The bonds have been structured such that the first payment is due in August 2018. The fiscal year 2018 budget includes funding for the principal and interest due at that time.
Staff Recommendation
Conduct the public hearing and consider the ordinance on first and final reading to award sale of certificates.
Drafter
Lauri Gillam
Assistant City Manager