Travis County Commissioners Court

March 13, 2012 (Agenda)
Item 17

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>> > 17, consider and take appropriate action on requested debt issuance schedule and funding for fiscal year 2012 capital projects.

>> > good afternoon, jessica rios, planning and budget.
last week the Commissioners' court was presented with a list of projects for voter approved bonds, state highway system bonds 2012 and certificates of obligation.
the only change that was proposed at that time was to add 15,000 to the 2000 voter approved bonds requested cash flow for u.s.
290 west and that will complete that voter approved project.
I'm here to answer any questions.
one thing I will say that was requested and that we've done since that time is run a couple of debt models just to give you some context of these recommendations, so you will see attachment a and attachment b are those debt models that include some assumptions.
attachment a, when we did there was just zeroed everything out for 2012 and thereafter so that you can see how the county is indeed paying off debt.
and then attachment b we layered in the cash flows for the pass-through projects, the 2011 voter approved bonds, the 2000 voter approved bonds that were issued in that 1,115,000 and then a co issuance assumption this year of the 29,000,150, and then in future years the assumptions that we laid out to the bond committee last summer and fall.
you can see under the debt service impact that the fy '12 debt service is current74.6 million and with assumptions of one percent interest rate for five-year debt and three percent interest rate for 20 year debt, the fy '13 debt service, including the fy '12 issuance that we're discussing today would rise to 79 million.

>> > and lad just performed me that the 20 year rates are still under three percent.

>> > right.
we were more conservative.
in the debt model we tend to be.
as far as the debt policy I also attached that for you to give you further recommendation as to why we're recommending five-year debt for the certificates of obligation.
we do recommend approval of the fy '12 debt issuance that totals 86,810,000.
and let you know that the order has been posted for next week that authorizes the publication of the notice of intent that's required.
the notice of intent to issue certificates of obligation and that will be posted for next week.
and I believe also ladd will be discussing further with you on the method of sale.
I'm happy to answer any questions about the schedule or anything on these lists.
and that's all we have.

>> > okay.
I'm looking for the 86 million.

>> > that's the first page where it says the Commissioners' court is asked to approve the following projects.
the total amount is 86,810.
and what I did there there was add up the roman numeral two and three, state highway assistants bond and the certificates of obligation.

>> > okay.
I see it in the first sentence in the memo.
is that the 54.29 times three and a half.

>> > yes.
voter approved bonds of 54160 and 2000 and 2012 voter approved bonds.
2, the voter highway system bonds, and I got the title of that from the bond council.
that's 3.5 million.
and 3 on the next page 29,150,000.

>> > and the decreasing debt service payment is that way because the assumption is that we keep making annual payments, but don't issue new debt?

>> > correct.
what I was trying to show in attachment a versus attachment b is if we stopped issuing debt obviously we have debt outstanding that we're paying off every year.
and so you can see that payoff occurring in attachment a.
attachment b is more realistic as far as it provides the current assumptions for debt issuance.
one thing I do want to know, and it's noted in the memo, is that the second tape.
b does not include any debt related to a possible new courthouse.
and that was not used for this exercise.
it was just to show you for today's request for issuance.

>> > > did y'all see the article in the paper regarding Williamson county?

>> > yes, sir.

>> > well, Travis County was mentioned there too, mr. Nellis.
in a favorable light, I might add.

>> > it really shows that we're doing a good job, I guess.
as far as some of these things that have been brought to the fore.
I guess all across the board, it's always good to mention that our bond rating is just outstanding.
and the best in the state compared to anybody else.
so I'm really happy and delighted to see these.
and of course, there are several, each one of us on this dais, has some of the projects and these particular projects that reside in our precincts, and of course I try to list out as many of these possibilities and bond issuance that deal with precinct 1.
of course, there are several, several, several all across the board.
but anyway, I keep track of that and as folks discuss this with us, we're going to make sure that they know about the particular projects as not only affect precinct 1, but other segments of Travis County.
so I feel real good about this, especially with our good track record as far as our credit rating, per se, with our triple a bond rating.
so I think that need to be always highlighted and said and spoke highly of when folks in Travis County realize that we have a great track record as far as our credit rating with the triple a bond rating.
I can't emphasize that enough.

>> > Commissioner, I'm (indiscernible), national advisor.
based on your comments I would like to tell the court when I was checking on rates today, just to see that we were still within conservatively below the range that jessica has mentioned to you, in checking the market, I found that there's a spread between a natural triple a, which is what we are, Travis County, and an insured triple a, meaning people that brought insurance t bring them up to triple a is right now 75 basis points.
today these bonds, if we sold them toll towed with our natural triple a, would be somewhere between 275 and 285.
and the insured triple a bonds today are under 350 to 360.
so being natural and having such good credit really does save this county and taxpayers a lot of money.

>> > taxpayers need to hear that.

>> > ms. Grimes, congratulations for that.

>> > got applause over there.

>> [ laughter ]

>> > move approval of item 17.

>> > second.

>> > discussion on the motion? All in favor? That passes by unanimous vote.

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