To: Mark R. Hafner, City Manager
From: Aaron Rector, Director of Administrative Services
Subject:
Title
Consider adoption of an ordinance authorizing the issuance and sale of City of Keller, Texas Combination Tax and Limited Surplus Revenue Certificates of Obligation, Series 2024, to provide funds for parks and recreation facility improvements and for related issuance costs; levying an annual ad valorem tax and providing for the security for and payment of such certificates; approving the Official Statement; providing an effective date; and enacting other matters and provisions relating to the subject.
Action Requested:
Consider adoption of an ordinance authorizing the issuance and sale of City of Keller, Texas Combination Tax and Limited Surplus Revenue Certificates of Obligation, Series 2024, to provide funds for parks and recreation facility improvements and for related issuance costs; levying an annual ad valorem tax and providing for the security for and payment of such certificates; approving the Official Statement; providing an effective date; and enacting other matters and provisions relating to the subject.
Background:
A special Task Force was created by City Council in August of 2021 to investigate and make recommendations for improvements to the Keller Sports Park. Members included representatives from all youth sports associations that utilize the Keller Sports Park, including the Keller Youth Association, Keller Soccer Association, Alliance Rugby Club, Keller Lacrosse Club, and representatives from Keller Equestrian Clubs, along with members of the City Council and Parks and Recreation Advisory Committee. Multiple public task force meetings and presentations on the project were held between August 2021 and February 2022. In March 2022, City Council accepted the Task Force recommendation and instructed staff to begin the design process and authorized a design contract with Parkhill.
The project consists of: adding a new grass multi-purpose field with an associated parking lot; replacing one grass soccer field with synthetic turf; constructing two new lighted baseball fields; renovating existing multi-purpose and baseball fields; constructing new restrooms, storage and concession buildings; constructing a new field house and meeting rooms, renovating existing restroom/concession buildings; constructing new shade structures; and enhancing landscaping, lighting, fencing, backstops, and netting throughout the park.
Funding for the project will mainly be certificates of obligation funded by KDC sales tax revenue. On December 5, 2023, Council approved a resolution to publish a notice of certificates of obligation for $28M to be funded over 15 years, and the City has received no public feedback related to the sale to date. The proposed issuance has been rated AAA by both Standard & Poor’s and Moody’s and will be a competitively bid bond. The total estimated cost of the issuance is $36,181,133.75 with an anticipated interest rate of 4.3%. The average annual impact will be $2,412,076 which is slightly lower than the budgeted estimate of $2,557,471.
Financial Impact:
The debt issuance is $28,000,000 funded over 15 years and will be paid by the KDC sales tax. The annual impact is approximately $2,412,076.
Legal Review:
Bond counsel has prepared the ordinance.
Alternatives:
City Council has the following alternatives:
• Approve as submitted
• Table
• Denial
Council Action:
Consider adoption of an ordinance authorizing the issuance and sale of City of Keller, Texas, Certificates of Obligation, Series 2024; levying an annual ad valorem tax and providing for the security for and payment of said bonds; approving an official statement, authorizing the execution of a purchase agreement, and paying agent/registrar agreement; and enacting other provisions relating to the subject.