Page 305 - City of Watauga FY22 Adopted Budget

DEBT SERVICE

This debt opportunity was available without any increase in the tax rate since the City’s
total debt obligations decreased the end of FY2013-2014. The expansion of the
existing Community Center to provide for an updated Senior Center facility and
improvements to Bursey Road, a major thoroughfare in the City were established as
priorities to be funded through the $3,500,000 debt issuance. These projects began in
FY2014-2015. Bursey Road Phase I was completed in FY2015-2016 and the Senior
Center was completed in FY2016-2017.

In FY2015-2016, the City issued $5,885,000 Combination Tax and Limited Pledge
Revenue Certificates of Obligation bonds, which will be paid from property tax levies.
These funds were used for street improvements throughout the City and quality of life
projects such as a splash pad, trails, and parking improvements. Whitley Road is the
final project funded by these proceeds and will be completed in FY2021-2022.

In FY2016-2017, $1.2 million of the Utility Fund debt service dropped off due to the
final payment being made in FY2015-2016 for the debt service associated with the
purchase of the Water system from North Richland Hills. In the summer of 2017, the
City Council considered and approved additional utility project infrastructure funding by
issuing certificates of obligation in the amount of $7.325 million. These funds were
received in August, 2017 and are funding water and sewer projects identified in the
City’s 5-year Capital Improvements Project plan. Whitley Road is the final project
funded by these proceeds and will be completed in FY2022-2023.

In FY2017-2018, $6.780 million Certificates of Obligation issuance was approved by
Council. The proceeds will fund street projects, park projects, building equipment,
signage throughout the City, and capital equipment items.

In August 2019, City Council approved an $8.490 million Combination and Limited
Pledge Revenue Certificates of Obligation. Proceeds will fund water and sewer projects
and equipment, and some general fund capital equipment. The majority of the debt,
$8.065 million, will be repaid with Utility system revenues and $425,000 of the principal
will be paid by the I&S component of the tax rate. Payments will begin in February
2020 at approximately $70,000 annually for the General Fund portion of the debt, and
approximately $344,000 for the Utility Fund. Standard & Poor Rating Services
assigned a ‘AA’ rating to this issuance.
In August 2020, a $3.0 million Combination and Limited Pledge Revenue Certificates of
Obligation issuance was issued. Proceeds will fund a Fire Station restroom renovation
project, continuation of the Whitley Road Street Project, and construction of a restaurant
food truck site at Capp Smith Park to spur economic development in the City.
Additional projects funded are a roof replacement for the Library facility, construction of
an equipment and vehicle storage facility (pole barn) for the Parks facility, and various
capital outlay items.

In August 2021, the City Council approved the issuance of a $4.7 million Combination
and Limited Pledge Revenue Certificates of Obligation issuance to continue the street

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