Title
Consider and take action on a resolution consenting to the sale and issuance of Unlimited Tax Bonds, Series 2024 (the “Bonds”) for the Westwood Management District (the “District”) in an amount not to exceed $8,015,000 and authorizing the Mayor to execute and the City Secretary to attest same for and on behalf of the City of League City (the “City”) (Director of Finance)
Background
Approval of this item will authorize the sale of Bonds to finance water, sanitary sewer, and drainage facilities to serve various Sections of Westwood Management District. Proceeds will also be used to pay for the engineering, land acquisition, creation, administrative and operational costs, as well as the cost of issuance of the Bonds. The District met on November 8, 2023, to authorize its consultants to proceed with the issuance of its Unlimited Tax Bonds, Series 2024, subject to receipt of the Order and Staff Memo from the TCEQ. The Bonds are the third installment of new money bonds issued by the District. The proposed bonds are rated, underlying “Baa3” Moody’s.
The Bonds are structured with a final maturity date that does exceed the end date of the district which is 2037; however, as per Chapter 3917 Special District Local Laws, Sec. 3917.251 (d) If the district has debt when it is dissolved, the district shall remain in existence solely for the purpose of discharging its debts. The dissolution is effective when all debts have been discharged. As mutually agreed to by the City and District, the end date of all bonds is 2049.
The District's 2023 adopted tax rate is $0.97 per $100 of assessed valuation for maintenance and operations, and the District anticipates levying a tax rate of $0.96 per $100 valuation for tax year 2024. The proposed 2024 tax rate is anticipated to be comprised of $0.59 per $100 valuation for maintenance and operations, $0.24 for WSD Bonds, and $0.13 per $100 valuation for Roadway systems. The District's tax year 2024 certified taxable assessed value from the Galveston Central Appraisal District is $431,588,393.00.
The District has $28,415,000 in outstanding direct debt after the issuance of the Bonds, which is 5.92% of the District’s estimate of taxable assessed value as of 2024. The Direct and Estimated Overlapping debt is estimated at $46,291,631; combined, overlapping and direct debt represents 9.62% of the District’s estimate of taxable assessed value as of July 7, 2024.
Pursuant to the Development financing Agreement with the City, the District may not levy a combined debt service and operation and maintenance tax rate that exceeds $1.00 per $100 in valuation without the written consent of the City. The foregoing limitation does not apply, however, to the extent the District must levy a greater debt service tax to provide for the payment of its bonds. To the extent that the District’s debt service tax rate equals or exceeds $1.00 per $100 in valuation, the District may not levy an operation and maintenance tax without the prior written consent of the City. The terms and conditions of the Bonds are in compliance with the Development Financing Agreement.
Please see attachments for additional information.
Attachments
1. Proposed Resolution
2. District Resolution Requesting Bond Issuance
3. Draft Preliminary Official Statement
4. Proposed Debt Service Schedule
5. Debt Service Cashflow worksheet
6. Schedule of Events
7. Engineer Compliance Letter
8. TCEQ Order and Staff Memo
9. GCAD Valuation
FUNDING
{X} NOT APPLICABLE
STRATEGIC PLANNING
{X} NOT APPLICABLE