Travis County Commssioners Court
January 28, 2003
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Item 14
14 is consider and take appropriate action on projects and amounts for funding from road and park bonds and certificates of obligation to be issued in f.y. '03.
>> last week you were briefed on [inaudible] and we're here to answer any questions. I would be glad to remind you of any of the issues at hand.
>> uh-huh.
>> in October, you approved a set of projects to be funded from certificates of obligation as well as voter-approved bonds. $17.1 million from certificates of obligation, 35 -- just a hair under 36 million for voter-approved bonds. The time has come to make a conclusion as to how much debt to issue to accomplish those projects. There would appear to be little on the table to modify the voter-approved bond issuance proposal. There has been a proposal put on the table to either borrow less in certificates of obligation because the precinct 4 office building completion came in at approximately $1.4 million less than was necessary to accomplish that project; or to borrow more to acquire either through construction or purchase a building to house the election and/or the records division and/or a site for the tax assessor/collector, and/or other projects to be determined.
>> christian, there was a correction needed to be made to the funding, s.h. 45, it just had s.h. 45 and it should be s.h. 45 north.
>> that was a typo and our apology. It should have been 45 spell 45 n because there's a north and south.
>> is that the one for 570? Because there's one on there, state highway 45 north, 570.
>> no, the road bonds. Down at the bottom where it says state highway 45 and fm 1826, it should have said state highway 45 n because that's what was approved.
>> before we expended the $45,000, they are already gone.
>> for purposes of this session, I think we're talking about the 1.4, the savings in the precinct 4 building. If I remember our discussions, if we -- if we did not borrow, if we used that 1.4 to decrease what we borrow, it would mean in a 20-year debt it would be payment of 130,000, right?
>> no, it would be actually less -- more than 130,000. It's 130,000 per million.
>> okay.
>> so you multiple 130,000 times 1.4 and you get about 180 and some change. So it would be $180,000 less in debt service should you decide to borrow $1.4 million less.
>> right.
>> but you have also on the table this proposal to borrow more, or the same.
>> but if --
>> that is the number.
>> but if we left it in, it would be $250,000 debt, be added to the debt service.
>> if you left --
>> per million, right?
>> well, if you modify -- the 250,000 is if you change five-year debt. The 130,000 if is if you change 20-year debt. The precinct 4 office building was 20-year debt. Therefore, if you pull out 1.4 million, you save 130,000 per million, you have 1.4 times 130,000 or roughly $180,000 less in debt service in f.y. '04 to tax for.
>> I guess the bottom line for me would be what would that mean to the pressure on taxpayers?
>> you would have $180,000 less pressure.
>> per year?
>> per year. For 20 years.
>> well, I think it's worth looking at and let me tell you why, because I continue to get the calls from citizens who tell me that the pressure on them to pay the taxes, and even though I explained it's only 16%, it's still pressure on them. And I wonder if it wouldn't help to reduce -- to give that back, not borrow the 1.4 savings.
>> we need to make sure that that's the correct number because roger would want us to say that was on the construction contract, but we put money back -- there was a draw down on it related to reestablishing a contingency budget and some things related to ff&e. So I'm fine with it be lower, but it needs to be the correct lower figure. And it's not 1.4 million.
>> my understanding was that it was 1.4 million netted. I don't have the exact number off the top of my head. I'll be happy to talk with roger.
>> we need to know what that exact number is because it's the construction contract was 1.4 million.
>> in roger's December 2 ndz memo to the court, he went through the various changes and netted out to 1.4. But since we are at a moment to --
>> double-check.
>> -- double-check, we'll absolutely double-check to confirm that. And also, it seems to me we should be double-checking any of these other numbers. If roger has any indication that, for example, the rest were all precinct 3 building or the north rural community center and clinic, both of which together total $6.5 million, if there is any indication there that those numbers are high or low, now is the time to --
>> we don't know because they haven't been [inaudible].
>> it's worth asking the question.
>> absolutely. Absolutely.
>> well, and we know that he does keep a real close check on those numbers and so I think we can feel like we can count on it.
>> yeah, Margaret, I'm right there with you, it's just that as long as we can agree upon and everybody agrees upon that that is the correct number, I'm fine with that as long as we all agree.
>> and I'm willing to wait to see what the real figure is. But I think that given the pressure that people are under, I think we need to kind of respond.
>> so we're looking at having this back on next Tuesday?
>> I guess. Will it take another week?
>> well, it may take an hour. I mean, we can do a quick confirmation. Would you like to delay until the afternoon?
>> I would like to delay it until next week.
>> next week. And look at it carefully.
>> and leroy provided me some figures and I would like to maybe share this with the court. I just received it late yesterday evening, and I think it basically gives us maybe a good overview of where we are on a few things, looking at the debt service. Leroy, if you look at the debt service for fiscal year '03 and compare that to '04, it's the -- then '04 would be 56 million, blah, blah, blah?
>> the commissioner had asked me what the budgeted debt service, total budgeted debt service in f.y. '03, and that is 64,462,031. That's what you adopted in your f.y. '03 budget. The other question he asked was if no debt wabs issued in '04 what would that debt service be, and that debt service would be 56,151,150 or a reduction in debt service of $8.3 million. If no new debt were issued, your projected debt service on the 17.1 and the 35.99 totals $7.96 million. So with the entire amount of the 17.1, which would be less the 180,000, approximately, if in fact you decide to reduce it by approximately 1.4 million, but if you issued the entire amount, your debt service is scheduled to go down by about 34 of thousand dollars per year, -- $346,000 per year as we sit right now. Those have some estimates in them. These numbers are derived from the memo christian had sent the entire court t commissioner had asked me to do a couple calculations on those numbers.
>> and with that total, if -- reduction as far as debt service with the $1.4 million being $183,575 reduction in debt service, along with the 300 some odd thousand dollars with the scenario that you just gave, the total amount in debt service would total up to be 530,086 --
>> right. In the event the court elects to reduce the debt issued by the $1.4 million, that would save you about $183,000 a year. If you add that to the projection of the decrease in the debt service of 346,000, that's the 530,000 that would result.
>> what are the specifics in terms of what projects are you referring to that would be eliminated or delayed in terms of the four instance to get that 300 and some odd thousand dollar figure. I don't know what you are talking about.
>> no projects.
>> no voter-approved projects?
>> all that's happening is debt is being paid off at a slightly higher rate than debt is being added.
>> I get that, but it's like and can somebody name for me the very specific voter approved projects that that would involve and what that entails considering we're in the middle of rfps and bidding documents related to the issuance of this very debt we're talking about?
>> let me clarify. If in fact the entire 17.1 ncos that you have in christian's memo are issued, all projects to be completed, and the 35.995 of voter-approved bonds, if everything gets issued just as it was approved in the budget process, you will still have a reduction in debt service in '04 of about $346,000. But that's basically what the commissioner asked me, what is that number. And, you know, those are our projections. With no delay in any project, no deletion of any project. You still have a -- the court is paying off the debt faster than they are adding to the debt is what that says, by about 346,000 a year.
>> okay. That doesn't solve anything.
>> I think it sends the right message to people. If you can do something with a savings of $1.4 million, I'm delighted to see the court look that direction with saying that is something we need to send to 2 the public because I think that's what they expect of us and I think that's the only prudent thing to do so I agree with all of my colleagues.
>> next week. Thank you.
>> thank you, leroy.
>> this will be back on.
Last Modified: Wednesday, April 2, 2003 10:25 AM