Page 67 - Honorable Mayor and Members of the City Council

lower than anticipated; the City Council approved purchasing the property with General Fund reserves in 2003-04.

The City’s bond counsel advised the City to re-finance existing debt (general obligation bonds) in order to reduce future
interest payments. The re-financing of this existing debt was also approved by Council in 2004-05. General obligation
bonds were re-financed in 2011. After the 2013-14 Budget was adopted, the City’s bond counsel recommended
refinancing general obligation bonds issued in 2005; these general obligation bonds were refinanced in November
2013.

Bank of America proposed revising the City’s Series 2005 General Obligation Bonds from a 3.49% rate to a 1.85% rate
effective February 1, 2015. The offer was reviewed by the City’s financial advisor, recommended by City Staff, and
approved by City Council. Significant savings are projected for interest payments for 2016-17 until the bonds are
retired in 2019-20.

Under current Texas statutes, the City has no legal limit on bonded debt. State statutes do, however, limit the total
amount of ad valorem taxes the City can impose. This limit is $2.50 per $100 of assessed valuation The City's current
total tax rate of $0.6400 (for both the General Fund and the Debt Service Fund) and the tax rate for retirement of debt
service of $0.0325 are considerably below this limit.

Debt Service expenses financed through property tax revenue total $973,740 in 2018-19. Included in this total is
$870,000 for general obligation bond principal retirements, $99,940 for general obligation bond interest expenses, and
$3,800 for agent fees.

No additional debt is scheduled for issuance in 2018-19.

CITY OF BENBROOK 2018-19 ANNUAL BUDGET
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