During its July 7 meeting, council approved a resolution that will allow city staff to publish Frisco’s intention to issue certificates of obligation. That is the first step in the process that would allow the funds to be delivered to the city in late September.
“This will allow some of the projects that were going to be delayed, rescheduled and pushed off a little bit to go ahead and move forward,” Assistant City Manager Nell Lange said during the meeting.
Frisco Mayor Jeff Cheney said July 8 those projects were temporarily paused at the beginning of the coronavirus pandemic to allow the city to assess its budget needs.
Lange told council that $30 million in general obligation bonds would be used for the continuation of road projects such as the expansion of Panther Creek Parkway between the Dallas North Tollway and Preston Road.
She said another $15 million in certificates of obligation bonds would support the installation of water lines along Rockhill Parkway and near the future PGA of America headquarters. Those would also fund a sewer interceptor in that area and the replacement of a lift station at Legacy Drive, she said.
“They are critical projects,” Cheney said of the planned work. “They’re infrastructure projects for the northern part of our city where there's a lot of development happening.”
The certificates of obligation bonds would be repaid from Frisco’s Water and Sewer Utility Fund, while the general obligation bonds would be repaid from ad valorem taxes. Cheney said issuing the bonds is not expected to affect the city’s tax rate.
“The last thing we want to do is obligate the city and then have to take a tax increase during difficult times,” he said.
In addition to the bond issuances, Lange said Frisco is also looking to refund some previously issued Series 2000 bonds to reduce debt payment over their remaining years.
“Refunding has a present value savings of 6.13%, which is about $1.9 million over the life of the bonds,” she said.
As figures for the upcoming budget are still preliminary, the assistant city manager noted council will have a budget work session before the bonds are scheduled to be sold. She explained publication of the intention to issue certificates of obligation does not tie Frisco’s hands.
“This is only a notice of intent, and it doesn't mean we have to move forward with anything,” Lange said.