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Item 6BCity of Southlake, Texas MEMORANDUM February 19, 2008 TO: Shana Yelverton, City Manager FROM: Sharen Jackson, Director of Finance SUBJECT: Ordinance No. 938, Consider all matters incident and related to the issuance and sale of "City of Southlake, Texas, Tax and Waterworks and Sewer System (Limited Pledge) Revenue Certificates of Obligation, Series 2008," including the adoption of an ordinance authorizing the issuance of such certificates of obligation to fund roadway, including sidewalks and the purchase of land, rights -of -way, and storm drainage capital improvements, as well as combined waterworks and sewer system extensions and capital improvements, and professional services related to the projects and financing thereof. Action Requested: Approval of Ordinance No. 938 authorizes the issuance of certificates of obligation for the purpose of funding capital improvement projects. Information: On January 15, 2008, the Council approved Resolution No. 08- 005. This authorized the publication of a notice in the newspaper of the city's intent to issue certificates of obligation. The certificates are issued and approved by adoption of an ordinance. Approval of Ordinance No. 938 will set in motion the legal requirements to obtain the proceeds. After approval, the legal documents must be reviewed by the Texas Attorney General's Office. The City would receive funding in early April. The proceeds from the bonds will be used for roadway, storm drainage, waterworks, and sewer system capital projects. Financial Considerations: The debt will be repaid through the City's ad valorem tax rate and a limited pledge of net revenues from the operation of the City's Waterworks and Sewer System. The proceeds from the bonds will be used to fund the approved projects in the 2007 -08 capital improvement budget. Bond package is approximately $14,085,000. Citizen Input/ Board Review: Public Hearing is scheduled for February 19, 2008. Legal Review: Fulbright and Jaworski serve as the City's bond counsel, and as such have prepared the Ordinance. Alternatives: In the absence of issuing the certificates, capital projects would be funded on a pay -as- you -go basis. Budgets and timing of the projects would be prioritized based on the amount of revenue projected by fiscal year. Supporting Documents: Ordinance No. 938 to be distributed by Fullbright and Jaworski during the February 19, 2008 Council meeting. Staff Recommendation: Approval of Ordinance No. 938