TITLE
Consider an ordinance authorizing the issuance of City of Killeen, Texas, Limited Tax Note, Series 2020 for Fire Department equipment.
SUMMARY
DATE: June 23, 2020
TO: Kent Cagle, City Manager
FROM: Jonathan Locke, Executive Director of Finance
SUBJECT: Fire Vehicle and Equipment Tax Note
BACKGROUND AND FINDINGS:
This ordinance is for the issuance of a limited tax note to purchase fire replacement vehicles and associated equipment. The Fire Department has 15 large vehicles and 8 of these vehicles are past their scheduled replacement date. The tax note will purchase 5 of the 8 vehicles that are behind schedule.
The 5 vehicles to be replaced and associated *replacement costs are:
Year Vehicle Description New Vehicle Cost Quantity Total Cost
2004 Aerial ladder truck $1,565,131|99|$1,565,131
1996 Pumper (Engine) truck $806,715|99|$2,420,145
2008 Rescue truck $939,967|99|$939,967
BuyBoard Fee $1,500
Multi-unit Discount ($70,000)
Total Cost $4,856,743
*The 5 new vehicles will come fully equipped with necessary tools and equipment.
The Texas Government Code, Chapter 1431, and the City’s Financial Governance Policy authorize the issuance of tax notes. An important note is that the financial policy limiting debt issuances until the debt portion of the tax rate reaches 25% applies when the amount of a new debt issuance exceeds the amount of debt being retired during the year. During Fiscal Year 2020, the City will retire $9,030,000 of debt and the estimated amount of the tax note is $4,915,000, inclusive of issuance costs.
The tax note will be repaid over a seven-year term with an estimated annual debt service payment of $750,000. The fund balance in the Debt Service Fund is currently $4,086,755 and must be used towards the retirement of debt. The tax note will be repaid with the accumulated fund balance in the Debt Service Fund. Fund balance accrues when more revenue is received than budgeted and/or when expenditures are less than bud...
Click here for full text