To: Honorable Mayor and Members of Town Council
From: Robert J. Slentz, Town Attorney
Title
Resolution Approving an Amendment to the Service Plan for the Bella Mesa Metropolitan District and Certifying Compliance with Town Code Section 11.02.110
Body
________________________________________________________________________________
Executive Summary
This Resolution is presented to Town Council to satisfy the requirement in the Municipal Code that any proposed metropolitan district general obligation bond issuance be reviewed by Town Council prior to issuance. The Bella Mesa Metropolitan District (District) Service Plan was approved by the Town Council in 2004, however, the District has not undertaken capital development or issued bonds. The District encompasses 406 acres generally north and east of Mesa Middle School. In the course of staff review of the District’s proposed financing, we requested that the District update the development projections in the Service Plan which are key to establish the ability of the District to retire its debt. Consequently, in addition to approving the proposed financing, the Resolution effects a limited modification of the Service Plan.
The District is proposing to issue approximately $26 million in 5.5% general obligation bonds to fund infrastructure development. Repayment of the bonds will come principally from a 55.66 mill levy which is the cap currently imposed in the Service Plan. It is anticipated that 817 residential units will be absorbed within the District over an eight-year period. The bonds are projected to be paid within 30 years, but in any event, the principal and interest will discharge in 40 years. This restriction applies to any refunding of the initial issue, however, it is recognized that in the future, a resident-controlled District Board may seek Council to relax the 40-year limit to support a refunding at a lower interest rate.
The District representatives were responsive to the issues raised by staff with the initial proposal and the Resolution contains reasonable restrictions and limitations on the District bonds.
Staff Recommendation
Staff recommends approval of the Resolution as presented.
Proposed Motion
“I move to approve the Resolution as presented.”
Attachments
Attachment A: Resolution