Item 4D: Adoption of Resolution 5077 on GO Bond to Fix Streets

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Adoption of Resolution 5077 Authorizing the Sale of General Obligation Bonds to Fix Streets and Fund Bicycle and Pedestrian Paths Meeting Date: January 14, 2013 Agenda Item Number: 4D Department: Central Services Staff Contact: Sue Cutsogeorge www.eugene-or.gov Contact Telephone Number: 541-682-5589 ISSUE STATEMENT The City Council is asked to authorize issuance of the $43,000,000 of General Obligation Bonds to fix streets and fund bicycle and pedestrian paths approved by voters in the November 2012 election. BACKGROUND The City Council placed Measure 20-197 on the November 2012 ballot. That measure proposed that $43,000,000 in General Obligation Bonds would be used to fix streets and fund bicycle and pedestrian paths. Voters approved the measure by a margin of 64 percent to 36 percent. Bond funds will be used to fix approximately 74 lane-miles of specifically identified streets as well as fund bicycle and pedestrian projects. This bond measure is expected to be implemented in the same manner as the 2008 Street Bonds and is similar to the one presented to the council for that measure. The attached resolution would allow the City the flexibility to issue a line of credit or other allowable types of debt, and to issue taxable or tax-exempt debt, as appropriate to meet IRS tax laws and minimize the overall cost to the City. The resolution also allows the City Manager to issue debt as needed to fund projects, without further council authorization. In the materials presented to voters for the bond measure, it was estimated that the average tax rate over the life of the bonds would be about $0.65 per $1,000 of assessed value. In developing a bond issuance plan, staff will target an average tax rate at or near the level estimated in the bond measure materials. The actual tax rate will depend on the amount of taxable assessed value in the City, however, and that may be different from what was used to create the estimates. Oregon law does not require that the council take specific action to authorize spending authority for the proceeds of a General Obligation Bond issue if the proceeds are spent in the same fiscal year as the bond election. Therefore, staff does not intend to bring an FY13 supplemental budget to council for this item. The FY14 budget will include additional project spending appropriation to allow project planning to occur in time for the summer of 2014 construction season. Taxes to S:\CMO\2013 Council Agendas\M130114\S1301144D.doc