Page 333 - Hurst FY20 Approved Budget

Debt Issuance

Historically, issuances have been around $5 million per year for all funds. However, during the past
six to eight years, the City began issuing debt to satisfy the November 2005 bond election and the
Transforming Hurst initiative. Market conditions also provided perfect opportunities to refinance or
refund existing debt.

The following summarizes the City’s debt issuances and refunding’s for 2009 through 2019.

• In 2009, the City issued $6 million in CO’s with $2 million, plus issuance costs, being
supported by the General Debt Service Fund. The $2 million will provide partial funding for
Pipeline Road Improvements. The City also refunded $2.6 million of tax supported debt in
2009 which provided $198,350 in annual savings.
• During 2011-2012, $2.7 million of General Obligation bonds were refunded. The 2012 Bond
Election was approved by voters and $16.5 million in General Obligation Bonds were also
issued for the construction of a Justice Center and related parking facilities.
• In 2012-2013 $7.83 million of General Obligation bonds were refunded resulting in
approximately $226,000 in savings for the General Debt Service Fund.
• During 2014-2015, $4.915 million of General Obligation bonds were refunded resulting in
approximately $261,674 in savings for the General Debt Service Fund. The City issued a
total of $3 million in debt for Public Works projects such as the continual widening and
development of Pipeline Road, as well as, miscellaneous Water and Sanitary Sewer
Replacements.
• During 2015-2016, most of the 2008 debt issued was refunded in the amount of $12.555
million were refunded resulting in approximately $2.1 million in savings for the General Debt
Service Fund, Enterprise Fund, Hotel/Motel Fund, and Half-Cent Community Services Fund.
The City issued a total of $5.4 million in debt for Community Services projects such as the
renovation of Central Aquatics Center and the Roof Repair at the Recreation Center.
• During 2016-2017, the city issued tax notes in the amount of $1.18 million for the purchase
of a new 100-foot ladder truck for Fire.
• During 2018-2019, the city issued $7 million in voter approved GO Bonds for the
construction of a new Animal Control Center. The city also issued $2 million in certificates
of obligation for infrastructure improvements.

The Capital Improvements Program as of October 1, 2019, identifies short and long-term unfunded
bond issue needs. The focus for future budget sessions will be on phasing in portions of the
unfunded capital program, completing voter approved projects and adapting bond issuance to the
infrastructure needs and financial position of the City.

The total property tax rate and the portion of the rate allocated to debt service have remained
relatively stable over the past ten years. New commercial and residential development, combined
with net increases in appraised values of existing properties have increased property tax revenues
over the last ten years, allowing the City to grant tax relief (e.g., maximum homestead exemption
and senior and disabled tax ceiling) while at the same time collecting sufficient revenue to fund
enhancements in operations and capital expenditures. In FY 2010-2011, due to declining property
values, the City approved a debt tax rate that was 6% higher than the 2010 rate. In fiscal year
2012-2013, the tax rate increased just over 3 cents from $.578 to $.6084978 to support the
issuance of voter approved General Obligation debt. The tax rate for fiscal year 2013-2014
remained the same as the previous year at $.6084978. Due to the growth in values, the City
adopted a tax rate decrease of approximately a quarter cent for fiscal year 2014-2015, which will
put the tax rate at the same level as 1992 at $.606. In 2015-2016, council adopted a tax rate equal
to the effective rate of $.61056. In fiscal year, 2016-2017 council adopted a tax rate above the
effective rate but just below the roll back rate at $.5879. In fiscal year 2017-2018 council adopted a
tax rate equal to the rollback rate of $.58094 and is higher than the effective rate of $.54840. In
fiscal year 2018-2019, council adopted a tax rate of $.58 which is a slight decrease from the prior
year. For fiscal year 2019-2020, council adopted a tax rate of $.597299.

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