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TO: <br />FROM: <br />CC: <br />DATE: <br />City of Tukwila <br />Allan Ekberg, Mayor <br />INFORMATIONAL MEMORANDUM <br />Finance Committee <br />Peggy McCarthy <br />Mayor Ekberg <br />November 15, 2017 <br />SUBJECT: Bond Ordinance to Finance the Public Works Shops portion of the Public <br />Safety Plan <br />ISSUE <br />Approve an ordinance for the issuance of one or more series of limited tax obligation (LTGO) bonds <br />in the aggregate principal amount not to exceed $20,000,000 to finance the acquisition of land and <br />construction of City maintenance facilities. <br />BACKGROUND <br />Pursuant to an affirmative vote on November 8, 2016, $36,709,954 of unlimited tax general <br />obligation (UTGO) bonds were issued to finance the justice center, the fire station and fire <br />equipment and apparatus portion of the Public Safety Plan. The Public Works shops portion of the <br />Public Safety Plan will be financed through councilmanic bonds and other means. On November 6, <br />2017, the City Council authorized the acquisition of parcels, including through eminent domain, to <br />site the justice center, fire station 54 and the Public Works shops. <br />DISCUSSION <br />The proceeds of the proposed bond issue(s) will be used to finance the acquisition of property for <br />the Public Works shops and pay for soft costs through mid -2019. Since the amount and timing of <br />funds needed is dependent on the speed with which the property purchase and sale agreements can <br />be negotiated, or legal decisions reached, the ordinance authorizes one or more bond issues to <br />maximize flexibility and minimize financing costs. It also authorizes short-term financing (i.e., a bank <br />loan), if funds are needed very quickly. <br />FINANCIAL IMPACT <br />Over a 5 -year period the budgeted debt service will more than cover the estimated actual debt <br />service. <br />In Thous$ <br />DEBT SERVICE 2018 2019 2020 2021 2022 TOTAL <br />Actual estimate - $20 million of proceeds $ 650 $ 825 $ 825 $ 825 $ 1,550 $ 4,675 <br />Budgeted - $29.5 million of proceeds: <br />-- governmental debt service 246 713 1,180 1,180 1,180 4,498 <br />-- utilities debt service 246 713 1,180 1,180 1,180 4,498 <br />Total Budgeted 492 1,426 2,359 2,359 2,359 8,996 <br />Actual Estimate Over (Under) Budget $ 158 $ (601) $ (1,534) $ (1,534) $ (809) $ (4,321) <br />RECOMMENDATION <br />The Council is being asked to approve the ordinance and consider this item at the November 27, <br />2017 Committee of the Whole meeting and subsequent December 4, 2017 Regular Meeting. <br />ATTACHMENTS <br />Draft bond ordinance. <br />Presentation by PFM <br />