Marble Falls to pursue $20 million in certificates of obligation
The city of Marble Falls is pursuing certificates of obligation for more than $20 million to pay for the relocation of the city’s wastewater treatment plant and other flood infrastructure projects. The City Council approved posting public notice of intent during its June 1 meeting.
Certificates of obligation allow local governments to fund necessary projects through debt sales without voter approval. However, the city is required to post public notice in local newspapers and on its website at least 45 days beforehand.
The council will issue the certificates during its Aug. 3 meeting.
“We have two separate (certificates) that were both discussed today, but the first step is to inform your citizens of what you’re doing,” explained Mark McLiney, senior managing director of SAMCO Capital.
The first and smaller of the two will issue $3,650,000 to cover costs associated with improvements on roads and bridges and low-water crossings and parks as well as updates to the master plan and improvements to water and wastewater treatment plants.
McLiney and colleagues will arrange the sale of this portion of debt, which must be repaid by 2041, for the city. McLiney said the loan’s interest rate will be determined during the Aug. 3 council meeting. He anticipates a 2.5 percent interest rate.
The remaining $17,809,000 will go directly to funding flood infrastructure projects, including the construction of a bridge over Backbone Creek, planning and constructing a tributary bypass channel to better manage flooding on the creek, and the relocation of the city’s wastewater treatment plant.
Flood Infrastructure Funds, including a $16.6 million zero-percent interest loan from the Texas Water Development Board, were awarded to the city in April. Because of this, the board will purchase this portion of debt.
The maturity date for this debt is Feb. 1, 2051.
The city currently has $66,971,209 of debt, including interest. Approximately $570,000 of that debt will be retired over the next five years, according to Finance Director Jeff Lazenby.
Despite new debt, the city hopes to slightly lower the property tax rate next year.
“As the general fund debt continues to be retired, the property tax rate decreases,” Lazenby explained during the meeting.
Currently, residents are taxed $0.6100 per $100 of assessed value of their properties. The anticipated tax rate for 2022 is $0.6050.