HomeMy WebLinkAboutFIN 2017-11-21 Item 2C - Public Safety Plan - Revised Informational Memorandum Distributed at MeetingTO:
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City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
Finance Committee
Peggy McCarthy
Mayor Ekberg
November 15, 2017
SUBJECT: Bond Ordinance to Finance the Public Works Shops portion of the Public
Safety Plan
ISSUE
Approve an ordinance for the issuance of one or more series of limited tax obligation (LTGO) bonds
in the aggregate principal amount not to exceed $20,000,000 to finance the acquisition of land and
construction of City maintenance facilities.
BACKGROUND
Pursuant to an affirmative vote on November 8, 2016, $36,709,954 of unlimited tax general
obligation (UTGO) bonds were issued to finance the justice center, the fire station and fire
equipment and apparatus portion of the Public Safety Plan. The Public Works shops portion of the
Public Safety Plan will be financed through councilmanic bonds and other means. On November 6,
2017, the City Council authorized the acquisition of parcels, including through eminent domain, to
site the justice center, fire station 54 and the Public Works shops.
DISCUSSION
The proceeds of the proposed bond issue(s) will be used to finance the acquisition of property for
the Public Works shops and pay for soft costs through mid -2019. Since the amount and timing of
funds needed is dependent on the speed with which the property purchase and sale agreements can
be negotiated, or legal decisions reached, the ordinance authorizes one or more bond issues to
maximize flexibility and minimize financing costs. It also authorizes short-term financing (i.e., a bank
loan), if funds are needed very quickly.
FINANCIAL IMPACT
Over a 5 -year period the budgeted debt service will more than cover the estimated actual debt
service.
In Thous$
DEBT SERVICE 2018 2019 2020 2021 2022 TOTAL
Actual estimate - $20 million of proceeds $ 650 $ 825 $ 825 $ 825 $ 1,550 $ 4,675
Budgeted - $29.5 million of proceeds:
-- governmental debt service 246 713 1,180 1,180 1,180 4,498
-- utilities debt service 246 713 1,180 1,180 1,180 4,498
Total Budgeted 492 1,426 2,359 2,359 2,359 8,996
Actual Estimate Over (Under) Budget $ 158 $ (601) $ (1,534) $ (1,534) $ (809) $ (4,321)
RECOMMENDATION
The Council is being asked to approve the ordinance and consider this item at the November 27,
2017 Committee of the Whole meeting and subsequent December 4, 2017 Regular Meeting.
ATTACHMENTS
Draft bond ordinance.
Presentation by PFM