Item B - Transportation Funding - Laserfiche WebLink

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ATTACHMENT D Transportation System Funding Project Overview of Individual Funding Options Brief Description General Obligation ("G.O.") bonds are backed by a property tax levy upon all property in of Funding the City. G.O. bonds must be approved by the voters. Option Precedence (prior General Obligation bonds are used extensively by local governments across the United Council history, States for a variety of purposes. The City currently has outstanding G.O. bonds issued other for the Hult Center garage, the airport expansion project and the public safety projects. jurisdictions' The City last issued G.O. bonds for transportation projects in 1974, with the issuance of practice, etc.) $3.3 million of Street and Sewer Project bonds. Examples of Oregon localities that have used G.O. bonds for transportation projects are the City of Salem, City of Lake Oswego and the City of Corvallis. Calculation Base The amount ora property tax levy for G.O. bonds depends on the desired capital and Typical Rates spending to be funded with the bonds. The levy calculation will be done annually during the budget process and it will take into account discounts and delinquencies in property tax payments, interest earnings on fund balances, and an Unappropriated Ending Fund Balance to cover any debt payments due during July through November. The rate will be based on the total levy amount divided by the total taxable assessed value for real and personal property in the City. Individual taxpayers will pay the tax rate times their individual assessed value. Estimated To fund $10 million of transportation projects with 20-year G.O. bonds, the City would Revenue Yield, need to levy approximately $1.1 million per year. This would cost approximately Administration/ $0.12/$1000 of assessed value in the first year, or about $17 for the average taxpayer. Enforcement Costs Property tax levies for G.O. bonds are exempt from the $10/$1000 of real market value tax rate cap for all general governments under Measure 5. Property taxes are administered by the County. They prepare the tax bills, collect the funds, and remit the appropriate amount to the City on a regular basis. Enforcement is done by both the County and the City in the foreclosure process. Legal Authority New or additional property taxes must be approved by a majority of the people voting in and Restrictions an election in November of an even-numbered year. In any other election, there must on Use also be at least a 50% turnout of voters (the double-majority requirement of Measure 50). G.O. bonds may only be used for "capital construction" and "capital improvements" but not for "maintenance and repairs, the need for which could be reasonably anticipated" The definition of maintenance and repairs includes an exception for "street and highway construction, overlay and reconstruction"