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City of Rosenberg

City of Rosenberg. Debt Service Fiscal Year 2016 Budget July 28, 2015. Legal Debt Margin. Under State Finance law, the City’s outstanding debt shall not exceed 10% of total assessed value. Assessed Value $ 2,098,372,112 10% of Assessed Value $ 209,837,211

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City of Rosenberg

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  1. City of Rosenberg Debt Service Fiscal Year 2016 Budget July 28, 2015

  2. Legal Debt Margin • Under State Finance law, the City’s outstanding debt shall not exceed 10% of total assessed value. • Assessed Value $ 2,098,372,112 • 10% of Assessed Value $ 209,837,211 • Rosenberg’s Outstanding Debt (principal only) $ 62,791,922 or 3.0% • Rosenberg’s Proposed Outstanding Debt $ 82,791,922 or 3.9% • Texas Constitution states that “no tax for any purpose shall ever be lawful for any one year, which shall exceed two and one-half percent of the Tax Rate to Achieve Maximum Tax Revenue $2.50 • Rosenberg’s Current Tax Rate $0.49 • According to the Texas Municipal League (TML) debt survey, despite this broad authority, the average city property tax rate for cities responding to the survey are as follows: • Population greater than 5,000 (209 cities) $0.539 • Population greater than 20,000 (73 cities) $0.57 • Population between 30,000 and 40,000 (12 cities) $0.575

  3. Debt Service Fund – Total CURRENT Obligations Includes Principal and Interest • Debt Requirements per Year • 2016 6,892,827 • 2017 6,699,749 • 2018 5,833,706 • 2019 5,644,514 • 2020 5,630,652 • 2021 5,279,138 • 2022 4,942,993 • 2023 4,918,381 • 2024 4,704,994 • 2025 4,564,363 • 2026 4,563,909 • 2027 4,560,742 • 2028 3,949,024 • 2029 3,111,095 • 2030 2,659,688 • 2031 1,684,215 • 2032 1,675,416 • 2033 1,241,400 • 2034 641,213 • Total $79,198,019 • Debt by Issue • 2006 CO 4,021,556 • 2007 GO 2,952,170 • 2007 CO 4,475,777 • 2008 CO 5,817,119 • 2008A CO 1,943,619 • 2009 CO 1,611,494 • 2009 GO 5,233,590 • 2010 GO 2,938,091 • 2010A CO 3,109,756 • 2010B CO 7,908,495 • 2010C CO 1,601,663 • 2011 GOR 2,677,500 • 2012 CO 9,117,666 • 2012 A CO 1,074,175 • 2012 GOR 1,378,500 • 2013 CO 10,260,400 • 2013 A CO 576,808 • 2014 GO 1,985,950 • 2014 CO 6,437,494 • 2014A CO 3,914,175 • 2004 SIB 162,022 • Total $79,198,019

  4. Current Debt Obligations - Principal and Interest

  5. Sources for 2016 Debt 2016 Proposed Debt Requirement Including Principal & Interest and Proposed Debt Issue in FY2016 $7,642,826 • Debt Fund Property Taxes $4,403,000 (58%) • Water/Wastewater Fund $2,315,663 (30%) • RDC $794,991 (10%) • Hotel/Motel Fund $62,437 (1%) • Subsidence Fund $63,145(1%)

  6. Key Points Regarding Current Debt • Scheduled annual payments reduce the City’s outstanding debt (principal) by an average of $4.8 million per year for the next two years. • Based on the current debt schedules, annual debt service requirements (principal and interest) will decrease by approximately $200,000 in FY2017, and $900,000 in FY2018 due to the retirement of debt issues. • The City’s outstanding tax supported debt was most recently rated “Aa3” by Moody’s and increased to “AA-” by Standard and Poor’s, further indicating the City’s fiscal stability and highlighting the City’s very strong creditworthiness.

  7. Debt Service Fund Balance • Financial policies recommend a minimum Fund Balance of 67% of Annual Debt Obligations be maintained as City policy. • Current Annual Debt Obligations for FY2015 are $6,892,827. • Current Fund Balance is $4,990,530 or 72% of Annual Debt Obligations.

  8. Key Points Regarding Future Debt • Water/Wastewater, Subsidence, RDC and Civic Center Funds will continue to pay 100% of their portion of the debt. • Future debt issued for the Alternate Water Project should be paid with subsidence fees or water impact fees and consequently should not increase the City’s debt tax rate. • Other alternatives to strategically maintain the debt rate include: • Strategically schedule the issuance of debt to qualify as “Bank Qualified” - $10,000,000 per year. • Structure future debt to control impact of debt rate. • Maintain adequate fees for special purposes (subsidence fees) to continue to cover the associated costs.

  9. RDC Debt Requirements – TOTAL OBLIGATIONS The RDC Debt is included in the Debt Service Fund. RDC is responsible for this portion of the Debt Service Fund obligations.

  10. Water /Wastewater Debt

  11. Summary of Water/Wastewater Debt • Not included in the Debt Service Fund. • Includes self-supporting debt such as revenue bonds, capital leases and State grant loans. • Total Water/Wastewater debt decreased by $667,258 from FY2015 to FY2016. • Three debt issues remain in W/WW Fund • SECO Loan – State of Texas • Bank of America – SECO projects • Texas Water Development Board – no interest loan

  12. Debt in Water/Wastewater Fund Total $4,435,643

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