2004-06-01
, .
I
I.
I
I
I
I
I
I
I
Ie
I
I
I
I
I
I
I
I-
I
OFFICIAL RECORD
CITY OF SOUTHLAKE
REGULAR CITY COUNCIL MEETING MINUTES: JUNE 1.2004
LOCATION:
1400 Main Street, Southlake, Texas
Council Chambers in Town Hall
CITY COUNCIL PRESENT: Mayor Andy Wambsganss, Mayor Pro Tem Rex Potter,
Deputy Mayor Pro Tem Keith Shankland, and Councilmembers Gregory Jones, Carolyn
Morris, Virginia Muzyka, and John Terrell.
CITY COUNCIL ABSENT: None.
STAFF PRESENT: City Manager Billy Campbell, Assistant City Manager Shana
Yelverton, Assistant to the City Manager John Eaglen, Library Administrator Kerry
McGeath, Manager of Technical Services Gary Gregg, Information Systems Technician
Sam Cobb, Director of Community Services Malcolm Jackson, Director of Economic
Development Greg Last, Economic Development Specialist Stefanie Wagoner, Director
of Finance Sharen Elam, Director of Human Resources Kevin Hugman, Director of
Planning Bruce Payne, Senior Planner Dennis Killough, Director of Public Safety Rick
Black, Chief of Fire Services Robert Finn, Chief of Police Marlin Price, Director of
Public Works Pedram Farahnak, Deputy Director of Public Works Charlie Thomas,
Assistant to the Public Work Director Valerie Bradley, Deputy City Secretary Tara
Brooks, City Attorney E. Allen Taylor, and City Secretary Lori Farwell.
WORK SESSION: The work session was called to order by Mayor Wambsganss at 5:38
p.m.
City Council reviewed the agenda items with city staff and applicants. Agenda items 9A,
9B, 9C, and 9D were added to the consent agenda. The work session ended at 6:57 p.m.
REGULAR SESSION:
Agenda Item No.1. Call to order: The regular session was called to order by Mayor
Wambsganss at 6:57 p.m.
Agenda Item No. 2A. Executive Session: Mayor Wambsganss announced that the City
Council would be going into Executive Session pursuant to the Texas Government Code,
Section 551.071, consultation with city attorney; Section 551.072, deliberation regarding
real property; Section 551.073, deliberation regarding prospective gift; Section 551.074,
deliberation regarding personnel matters; Section 551.076, deliberation regarding security
devices; Section 551.087, deliberation regarding economic development negotiations;
Section 418.183(f) Texas Disaster Act; and Section 418.106(d) & (e), local meetings to
discuss emergency management plans regarding pipeline safety. City Council adjourned
for Executive Session at 6:57 p.m. Executive Session began at 7:11 p.m. and ended at
7:53 p.m.
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 10/8
I
I.
I
I
I
I
I
I
I
I.
I
I
I
I
I
I
~.
I
I
Agenda Itern No. 2B. Reconvene: Mayor Wambsganss reconvened the regular meeting at
7:55 p.m. The Mayor asked if there was any action necessary as a result of the Executive
Session. No action was necessary.
Agenda Item No.3. Invocation: The invocation was given by Coy Quesenbury from
Lonesome Dove Baptist Church. Mayor Wambsganss led the audience in the Pledge of
Allegiance.
Agenda Item No. 4A. Mayor's Reoort: Mayor Wambsganss announced upcommg
meetings and events.
Agenda Item No. 4B. City Manager's Report: City Manager Campbell welcomed the new
City Council members.
Agenda Item No. 4C. SPIN Reoort: A written report was given to Council.
Agenda Item No. 4D. Library Reoort: A written report was given to Council.
Agenda Item No. 4E. Park and Recreation Board Reoort: Boardmember Mary Georgia
advised the Council of upcoming meetings and events.
Agenda Item No. 4F. Local Business Reoort. Director Last stated that Jim Morgan,
General Manager with Drexel Heritage, was scheduled for the Local Business Report but
had to leave early.
CONSENT AGENDA: Consent agenda items are considered to be routine by the City
Council and are enacted with one motion. The Mayor read the items into the record.
Agenda Item No. 5A. Aoorove minutes for the May 18. 2004. regular City Council
meeting and for the May 25. 2004. special City Council meeting. Council approved the
minutes as presented.
Agenda Item No. 5B. Resolution No. 04-034. Aoooint the Mayor Pro Tern and the
Deouty Mayor Pro Tern. Mayor Wambsganss named Rex Potter as Mayor Pro Tern and
Keith Shankland as Deputy Mayor Pro Tern. In accordance with Section 4.21 of the City
Charter, the caption for this item is listed as follows:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SOUTHLAKE,
TEXAS, APPOINTING A MAYOR PRO TEM AND A DEPUTY MAYOR PRO TEM
PURSUANT TO ARTICLE 2.07 OF THE HOME RULE CHARTER; AND
PROVIDING AN EFFECTIVE DATE.
Agenda Item No. 9A. Resolution No. 04-038. Approving an absence policy for members
of City Council and various boards. Mayor Wambsganss presented this item during the
work session. Council approved this resolution applicable only to the City Council and
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 2 of8
I
I.
I
I
I
I
I
I
I
I.
I
I
I
I
I
il
II
I.
I
the Planning and Zoning Commission. In accordance with Section 4.21 of the City
Charter, the caption for this item is listed as follows:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SOUTHLAKE,
TEXAS ESTABLISHING AN ABSENCE POLICY FOR MEMBERS OF THE CITY
COUNCIL AND THE PLANNING AND ZONING COMMISSION; AND PROVIDING
AN EFFECTIVE DATE.
Agenda Item No. 9B. Resolution No. 04-032. Apl>ointing five members to serve on the
Board of Directors of the Tax Increment Reinvestment Zone Number One. City of
Southlake. Texas. Rex Potter, Carolyn Morris, Gregory Jones, Virginia Muzyka, and
John Terrell were named to the Board of Directors. In accordance with Section 4.21 of
the City Charter, the caption for this item is listed as follows:
A RESOLUTION OF THE CITY OF SOUTHLAKE, TEXAS, APPOINTING
MEMBERS TO THE BOARD OF DIRECTORS FOR THE TAX INCREMENT
REINVESTMENT ZONE NUMBER ONE OF THE CITY OF SOUTHLAKE;
PROVIDING AN EFFECTIVE DATE.
Al?:enda Item No. 9C. Resolution No. 04-035. ADpointing one City Council member to
the Joint Utilization Committee. John Terrell was named to the Joint Utilization
Committee. In accordance with Section 4.21 of the City Charter, the caption for this item
is listed as follows:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SOUTHLAKE,
TEXAS, APPOINTING A MEMBER TO THE JOINT UTILIZATION COMMITTEE
AND PROVIDING AN EFFECTIVE DATE.
Agenda Item No. 9D. Resolution No. 04-036. Appointing three City Council members to
the Southlake Parks Development COIporation. Carolyn Morris, Rex Potter, and Virginia
Muzyka were named to the Southlake Parks Development Corporation. In accordance
with Section 4.21 of the City Charter, the caption for this term is listed as follows:
A RESOLUTION OF THE CITY OF SOUTHLAKE, TEXAS, APPOINTING
MEMBERS TO THE SOUTHLAKE PARKS DEVELOPMENT CORPORATION;
AND PROVIDING AN EFFECTIVE DATE.
Motion was made to approve consent agenda Item Nos. 5A; 5B appointing Rex Potter as
Mayor Pro Tern and Keith Shankland as Deputy Mayor Pro Tern; 9A approving an
absence policy for City Council and the Planning and Zoning Commission; 9B
appointing Rex Potter, Carolyn Morris, John Terrell, Gregory Jones, and Virginia
Muzyka to the Board of Directors of the Tax Increment Reinvestment Zone Number One;
9C appointing John Terrell to the Joint Utilization Committee; and 9D appointing
Carolyn Morris, Rex Potter, and Virginia Muzyka to the Southlake Parks Development
Corporation.
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 3 0[8
I
I.
I
I
I
I
I
I
I
I-
I
I
I
I
I
I
I
.
I
I
Motion:
Second:
Ayes:
Nays:
Approved:
Potter
Shankland
Jones, Morris, Muzyka, Potter, Shankland, Terrell, Wambsganss
None
7-0
REGULAR AGENDA
Agenda Item No.6. Public Forum. No one spoke.
Agenda Item No. 7 A. Ordinance No. 865. Auuroving and authorizing: the Issuance of
Certificates of Obligation. Series 2004. Director Elam presented this item to Council in
conjunction with item 7B. In accordance with Section 4.21 of the City Charter, the
caption for this term is listed as follows:
AN ORDINANCE AUTHORIZING THE ISSUANCE OF "CITY OF SOUTHLAKE,
TEXAS, TAX AND WATERWORKS AND SEWER SYSTEM (LIMITED PLEDGE)
REVENUE CERTIFICATES OF OBLIGATION, SERIES 2004"; SPECIFYING THE
TERMS AND FEATURES OF SAID CERTIFICATES; PROVIDING FOR THE
PAYMENT OF SAID CERTIFICATES OF OBLIGATION BY THE LEVY OF AN AD
VALOREM TAX UPON ALL TAXABLE PROPERTY WITHIN THE CITY AND A
LIMITED PLEDGE OF THE NET REVENUES FROM THE OPERATION OF THE
CITY'S WATERWORKS AND SEWER SYSTEM; AND RESOLVING OTHER
MATTERS INCIDENT AND RELATING TO THE ISSUANCE, PAYMENT,
SECURITY, SALE AND DELIVERY OF SAID CERTIFICATES, INCLUDING THE
APPROVAL AND EXECUTION OF A PAYING AGENT/REGISTRAR
AGREEMENT AND A PURCHASE CONTRACT AND THE APPROVAL AND
DISTRIBUTION OF AN OFFICIAL STATEMENT; AND PROVIDING AN
EFFECTIVE DATE.
No one spoke during the public hearing.
Motion was made to approve Ordinance No. 865, Approving and authorizing the
Issuance of Certificates of Obligation, Series 2004.
Motion: Potter
Second: Shankland
Ayes: Jones, Morris, Muzyka, Potter, Shankland, Terrell, Wambsganss
Nays: None
Approved: 7-0
Agenda Item No. 7B. Ordinance No. 866. Approving and authorizing the Issuance of
Certificates of Obligation. Series 2004A. Director Elam presented this item to Council in
conjunction with item 7A. In accordance with Section 4.21 of the City Charter, the
caption for this term is listed as follows:
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 4 of8
I
I.
I
I
I
I
I
I
I
Ie
I
I
I
I
I
I
I
I.
I
AN ORDINANCE AUTHORIZING THE ISSUANCE OF "CITY OF SOUTHLAKE,
TEXAS, TAX AND WATERWORKS AND SEWER SYSTEM SURPLUS REVENUE
CERTIFICATES OF OBLIGATION, SERIES 2004A"; SPECIFYING THE TERMS
AND FEATURES OF SAID CERTIFICATES; PROVIDING FOR THE PAYMENT OF
SAID CERTIFICATES OF OBLIGATION BY THE LEVY OF AN AD VALOREM
TAX UPON ALL TAXABLE PROPERTY WITHIN THE CITY AND A LIEN ON
AND PLEDGE OF THE NET REVENUES FROM THE OPERATION OF THE
CITY'S WATERWORKS AND SEWER SYSTEM; AND RESOLVING OTHER
MATTERS INCIDENT AND RELATING TO THE ISSUANCE, PAYMENT,
SECURITY, SALE AND DELIVERY OF SAID CERTIFICATES, INCLUDING THE
APPROVAL AND EXECUTION OF A PAYING AGENT/REGISTRAR
AGREEMENT AND A PURCHASE CONTRACT AND THE APPROVAL AND
DISTRIBUTION OF AN OFFICIAL STATEMENT; AND PROVIDING AN
EFFECTIVE DATE.
No one spoke during the public hearing.
Motion was made to approve Ordinance No. 866, Approving and authorizing the
Issuance of Certificates of Obligation, Series 2004A.
Motion: Shankland
Second: Potter
Ayes: Jones, Morris, Muzyka, Potter, Shankland, Terrell, Wambsganss
Nays: None
Approved: 7-0
Agenda Item No. 7C. Ordinance No. 480-436. 2nd Reading (ZA04-006) Zoning Change
and Site Plan for Tamer Office Building described as Lot 1. Block 4. Timarron Phase
One. Section Two. Bent Creek. located at 175 East Continental Boulevard. Current
Zoning: R-PUD Residential Planned Unit Develo{>ment District. Requested Zoning: S-P-
1 Detailed Site Plan District. SPIN Neighborhood #9W. Senior Planner Killough
presented this item to Council. Applicant Michael Tamer, 1319 Eagle Bend Drive,
Southlake, Texas, answered Council's questions. In accordance with Section 4.21 of the
City Charter, the caption for this term is listed as follows:
AN ORDINANCE AMENDING ORDINANCE NO. 480, AS AMENDED, THE
COMPREHENSIVE ZONING ORDINANCE OF THE CITY OF SOUTHLAKE,
TEXAS; GRANTING A ZONING CHANGE ON A CERTAIN TRACT OR TRACTS
OF LAND WITHIN THE CITY OF SOUTHLAKE, TEXAS BEING LEGALLY
DESCRIBED AS LOT 1, BLOCK 4, TIMARRON, PHASE 1, SECTION 2, BENT
CREEK, AND BEING APPROXIMATELY 0.939 ACRES, AND MORE FULLY AND
COMPLETELY DESCRIBED IN EXHIBIT "A" FROM "R-PUD" RESIDENTIAL
PLANNED UNIT DEVELOPMENT DISTRICT TO "S-P-l" DETAILED SITE PLAN
DISTRICT WITH LIMITED "0-1" OFFICE DISTRICT USES, AS DEPICTED ON
THE APPROVED SITE PLAN ATTACHED HERETO AND INCORPORATED
HEREIN AS EXHIBIT "B", SUBJECT TO THE SPECIFIC REQUIREMENTS
CONTAINED IN THIS ORDINANCE; CORRECTING THE OFFICIAL ZONING
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 5 of8
I
I.
I
'I
I
I
I
I
I
Ie
il
I
I
I
I
I
,~.
I
I
MAP; PRESERVING ALL OTHER PORTIONS OF THE ZONING ORDINANCE;
DETERMINING THAT THE PUBLIC INTEREST, MORALS AND GENERAL
WELFARE DEMAND THE ZONING CHANGES AND AMENDMENTS HEREIN
MADE; PROVIDING THAT THIS ORDINANCE SHALL BE CUMULATIVE OF
ALL ORDINANCES; PROVIDING A SEVERABILITY CLAUSE; PROVIDING FOR
A PENALTY FOR VIOLATIONS HEREOF; PROVIDING A SAVINGS CLAUSE;
PROVIDING FOR PUBLICATION IN THE OFFICIAL NEWSPAPER; AND
PROVIDING AN EFFECTIVE DATE.
No one spoke during the public hearing.
Motion was made to approve Ordinance No. 480-436, 2nd Reading (ZA04-006) Zoning
Change and Site Plan for Tamer Office Building subject to Site Plan Review Summary
No.2, dated April 2, 2004, as approved on 1 st Reading.
Motion: Potter
Second: Jones
Ayes: Jones, Morris, Muzyka, Potter, Shankland, Terrell, Wambsganss
Nays: None
Approved: 7-0
Agenda Item No. 7D. Ordinance No. 480-438. 2nd Reading (ZA04-022) Zoning Change
for 880 South Carroll Avenue. Current Zoning: R-PUD Residential Planned Unit
DeveloDment District. Requested Zoning: SF-IA Single Family Residential District.
SPIN Neighborhood #ge. Senior Planner Killough presented this item to Council. In
accordance with Section 4.21 of the City Charter, the caption for this term is listed as
follows:
AN ORDINANCE AMENDING ORDINANCE NO. 480, AS AMENDED, THE
COMPREHENSIVE ZONING ORDINANCE OF THE CITY OF SOUTHLAKE,
TEXAS; GRANTING A ZONING CHANGE ON A CERTAIN TRACT OR TRACTS
OF LAND WITHIN THE CITY OF SOUTHLAKE, TEXAS BEING LEGALLY
DESCRIBED AS TRACT 6A, SITUATED IN THE O.W. KNIGHT SURVEY,
ABSTRACT NO. 899, BEING APPROXIMATELY 2.447 ACRES, AND MORE
FULLY AND COMPLETELY DESCRIBED IN EXHffiIT "A" FROM "R-PUD"
RESIDENTIAL PLANNED UNIT DEVELOPMENT DISTRICT TO "SF-IA" SINGLE
FAMILY RESIDENTIAL DISTRICT, SUBJECT TO THE SPECIFIC
REQUIREMENTS CONTAINED IN THIS ORDINANCE; CORRECTING THE
OFFICIAL ZONING MAP; PRESERVING ALL OTHER PORTIONS OF THE
ZONING ORDINANCE; DETERMINING THAT THE PUBLIC INTEREST, MORALS
AND GENERAL WELFARE DEMAND THE ZONING CHANGES AND
AMENDMENTS HEREIN MADE; PROVIDING THAT THIS ORDINANCE SHALL
BE CUMULATIVE OF ALL ORDINANCES; PROVIDING A SEVERABILITY
CLAUSE; PROVIDING FOR A PENALTY FOR VIOLATIONS HEREOF;
PROVIDING A SAVINGS CLAUSE; PROVIDING FOR PUBLICATION IN THE
OFFICIAL NEWSPAPER; AND PROVIDING AN EFFECTIVE DATE.
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 60f8
I
I.
I
I
I
I
I
I
I
10
I
I
I
I
I
I
I
I.
I
No one spoke during the public hearing.
Motion was made to approve Ordinance No. 480-438, 2nd Reading (ZA04-022) Zoning
Change for 880 South Carroll Avenue.
Motion: Shankland
Second: Potter
Ayes: Jones, Morris, Muzyka, Potter, Shankland, Terrell, Wambsganss
Nays: None
Approved: 7-0
Agenda Item No. 8A. Ordinance No. 867. 1st Reading. Changing the street name of Pin
Oak Circle to Tuscan Ridge Circle. Senior Planner Killough presented this item to
Council. Applicant Tom Mathews was present to answer Council's questions.
Motion was made to approve Ordinance No. 867, 1st Reading, Changing the street name
of Pin Oak Circle to Tuscan Ridge Circle.
Motion: Potter
Second: Jones
Ayes: Jones, Morris, Muzyka, Potter, Shankland, Terrell, Wambsganss
Nays: None
Approved: 7-0
Agenda Item No. 8B. Ordinance No. 480-439. 1st Reading (ZA04-021) Zoning Change
and Concept Plan for oroposed Lots 1. 2R1. 3.4. and 5. Block 5. Cornerstone Business
Park located on the east side of the 300 through 500 blocks of South Nolen Drive.
Current Zoning: S-P-2 General Site Plan District and AG Agricultural District.
Reauested Zoning: S-P-2 General Site Plan District with C-2 Local Retail Commercial
District and 1-1 Light Industrial District uses. SPIN Neighborhood #7. Senior Planner
Killough presented this item to Council. Applicant Max Kruegler presented this item to
Council and answered Council's questions.
Motion was made approve Ordinance No. 480-439, 1st Reading (ZA04-021) Zoning
Change and Concept Plan for proposed Lots 1, 2Rl, 3, 4, and 5, Block 5, Cornerstone
Business Park, subject to Concept Plan Review Summary No.2, dated May 14, 2004;
incorporating the recommendations of the Planning and Zoning Commission; and
accepting the applicant's willingness to restrict the impervious coverage on Lot 1 to 75%,
Lot 2 to 81.2%, a maximum of 80% on Lots 3, 4, and 5 with an overall combined
Itl#lXimum impervious coverage on all lots of 75%; and accepting the applicant's
agreement to further eliminate the following 1-1 uses: machine shop, mini-warehouses,
aluminum product fabrication, broom manufacturing, cold storage warehouse,
compounding of cosmetics and toiletries, janitorial or cleaning services, mattress
manufacturing or renovation, and manufacturing of medical and dental equipment.
Motion: Potter
Second: Shankland
Ayes: Jones, Morris, Muzyka, Potter, Shankland, Terrell, Wambsganss
Nays: None
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 70f8
I
I.
I
! I
I
I
I
I
I
--
I
I
I
I
I
I
I
.
I
I
Approved: 7-0
Agenda Item No. l1A. Bond rating Dresentation. City Manager Campbell, Assistant City
Manager Yelverton, Directors Elam and Last, and, Jim Sabonis with First Southwest
presented this item to Council during the work session.
Agenda Item No. 12. Meeting adiourned. Mayor Wambsganss adjourned the meeting at
8:44 p.m.
* An audio recording of this meeting will be permanently retained in the City
Secretary's Office.
-A~)~
{Andy Wambsganss
Mayor
ATTEST:
",,,...,',,,,,,
.......'" SourH.~""'"
,:.' 0<< ......... ~
$ ... .... ~ ~
-.~.. ..-:,
:/-.: * \"""'~
- - . .~ -
:0: : :
-: , : =
';. ... I~i
~ ... ..- $
'; ......... ~'Iit
" "'" .....
'I, ....** "..
"",.,....."",'
~'(J .~
Lori A. Farwell, T C
City Secretary
REGULAR CITY COUNCIL MEETING MINUTES, JUNE 1, 2004
Page 80f8
- 4- y C'ouelu
a-t -HL e 2OO!F
Mee -i
Bond Ratings Overview 5 ou ake
• What are credit ratings?
Southlake Texas o A credit rating is a current opinion of the
creditworthiness of the city with respect to a
The Professional's Choice! specific financial obligation or specific financial
program;
• How often are ratings presentations?
o A credit rating is issued only when there is
o .A ad
Bond Rating Presentation adequate information available to form a credible
S
o An issuer requests a credit rating for an
anticipated debt issuance; co
Bond Ratings Overview S Bond Ratings Overview Sou thlooke
• How does the city get rated? • How does the city get rated?
o The Rating Agency assembles a team of analysts o Following review and discussion, a rating
with relevant expertise, with a lead analyst
responsible for the rating process; committee meeting is convened. At the meeting,
o Several members of the analytical team meet with the committee discusses the Lead analyst's
management of the organization to review, in recommendation and pertinent facts supporting
detail, key factors that have an effect on the rating, the rating. Finally, the committee votes on the
including operating and financial plans and recommendation.
management policies. The meeting also helps
analysts develop the qualitative assessment of
management itself, an important factor in the
rating process;
Presentation Overview So Presentation Team Sol�ke
=1=4„— Billy Campbell Shana YeIverton •......
• Why are we here today? (Jim Sabonis) • City Manager, •Asst. Gty Manager
• 16 years with City • 11 years with City ▪ Presentation team introductions and city
leadership overview (Billy Campbell) •
• Management factors (Shana Yelverton)
• Financial factors (Sharen Elam)
Shares Elam s Greg last
• Economic factors /development (Greg Last) • Finance Director • Dir. OfEcon. Dev.
• 4 years with City • 14 years with City
• Follow -up questions or remarks?
`1.
Management Factors
filfg
so l e Financial Factors Sou ake
• Management controls - • Fund balance policy
o Ongoing budget review • FY 02 - results
o Cost containment • FY 03 -04 status and anticipated results
o Financial trend review
• Sales tax trends (historical and projected) 1ur10
o Policy updates
• Property values (historical and projected) L.k)
Sales Tax Trends
s° ' e Property Value Trends s« � , tniok e
i� —
44 , 500 "_._..__........._.."' ........................._"`.....____........_._................_..........._...... ..._....._.._......_........_..
8.7%
e se Mil Mar S 1,000 oOl�r a.s
I Mau $3,500 ■ O'Dmmmerdal 12.7% j
oRmitlenlial
p _ 31000 XGravih from praviwa year 11111 ie
F eM
72X
n.Me `f Z $2.500 "" ® 'e'" S' �
MAN I 10 ' ' s 110•01 DIV Ig. .61 !1 mm mM 91 -92 92 -93 93 -94 94 -95 95 -96 96 -97 97-98 98 -99 99 -00 00 -01 01 -02 02 -03 03 -04`
Fiscal Yea e
sra .cr_ ..�,... .r.. .. i.... _ sr. dd�uryu of S,Aw Fiscal Year
orrellassercerseeneer
■
ej
National /State Locat so Regional Location s cni mi
T ✓ e
�- 1 1' -: Doom F y,.,F 'S' -Y d �n'e i s '`',.,ft, .�.�
&g
--,-,'-7'. 97 1IiITxE ;-•'-•': ° v im ' „ ' 5'� 's. 4 4 - � � 4.
` "-"-� 7 - `�` ;� $ �S * # ;, F rte' ' E a �d
* • •
22 square miles , $ '
y +• „ �” 4r largest ci „„ In Coun*gty t„.�ay rc
Foot Worth I Dallas "'.*Ur r 7." Kff e r
DFW International Airport So Alliance Airport o u — thloke
• www.dfwairport.com
■ www.allianceairl ort.com
1 ' 'u�" ;k ■ World's first One of the largest i rst industrial airport
onomic generator for
ti ■Ec.
the North Texas region • nter - modal
- - — ,+� • 2,100 flights daily with
E terminals in the count
M '- F ' • more than 160 nonstop • One of the nation's largest ra
"^_ destinations I car go facilities
• One of the world's 4 • Largest sw • T exas
preeminent airports • Air cargo facility and distribution
■ Leader in the aviation r - center fed by an industrial airport
industry
• International Terminal D
1 a
_ Historical & Projected
Basic Data �� ��- Southloke
_ Population e.
• Population: 24,550 (Jan. 1, 2004) City of Southlake: Historical and Projected Poulatlon ap
• Avg. household income: $150,549 — '� °°° �.�P -
• 8 -City household avg. income: $105,925 0 28988 •
• Avg. household size: 3.35 people/household j ]0000 11111111111111111111111111111111111111111i_111111111_111111111
■ 59/0 with bachelor's degree or higher — sa: 111
99' 1111111 " '�11111111 !ii 1 1
• 637,130 people within 10 miles of SH 114 ���������� ! lIIII������� 0 't %Br 9w h199 0.2 004
soon : :: ;iiIiilil"'1"111""1" ] .rx er9Bnn 2 003.2004 j
■ Tarrant County's premier retail location ° aB
18)a 1B]) 1880 1880 1888 1B 1893 1B99 1998 30°1 1001 300] 1010 10 1018 2019
'E0sc0ve auilaaul ba.ed on Me aa0pba 1998 Liry d BOUMIMe Lana U.. Plan
Land Use & Zoning Maps •Mi ce Area Housing S •k e
— 1 Land Use Plan Zoning District Map LL `� �%e i u 7 117CW9e, art city Ix maau
9 sea, ba
11, � +. n'
''?§. ,( B, �` r lw f I 5adhkke 500].27,
y yS 1 Gr.pe 518911]
a
$ ?� ]t dleyvJle 5551,518
.� 4p I 9 { ?I t 0 V N8 C l \ a Keller 5119.210
i v h ? F '7j { , g
? IL 1 ,�,, ` ,, , v L � " s Sulu. mil,.
1
2 � � a ( * , T up b y Llua f1a0,211
"�Y � 9Y+4i 4 $Yi'�a ;, h i 1 F W 2 N v"� € j�\" ] NRWR WI Ia fits ell
t 0;4,1 a err x b e ' H i i l' ! ���
...ri i g 4 A .� 1 1 ,.. a \\ 9 xo sums
r a ti 3 � a TTTii . , a v \ \ 5 9c91a
' pit ..... ' 7od e,;. P,,,,,,,,,,,,-,, \
' a.e. mak prke for each coy r�o, love x 9oi.w.. r soul
—
Southlake Residential
sou_ ?�° School Districts 5 o"ke
g ;.r c,*7 � !S!.! �
-
OBI
® I Carroll wia.�r ou.rau dwore
i ri AP R 5 - _ _..
����� 111
PI�R 4l I1•� , C '" s i I � I NDrthwestlSD
�: � ' �l s ti �,� ' �� III � `L� 'III 11� �..,.+� '.aon hwcs tikiza.ua
Al, a °i l
II �, I Keller ISD
�t, p� ' r ®. � �\ cnpevi Jculkyvl11 sD
4 -.. is < � ap p \ `2 � \ \ \ \ \ ®t � \�
—
Major Projects s o � cn b ' � k e _ Southloq
— t
Nat ake RecogTnit wn f rom S ULI uare s
Sabre Headquarters'
�� Solana ,,r r '
-n= �, ' ' ;t {"'N'''''.
�' " i'� Verizon Wireless NOCC ,
.` S" Deep South ?d;a �,�' 5i '4 ,...k
: x+ - Aventerra 536 Acres
'1-:".,:'''''''',' � ' � Har S outhlake Town Square
a ris Methodis
t Surgery Center �^c* C
sxr • �'" t ,,,,;.. Sors +`^ ;<'` r'" JI a �hg
�'7.. w a # �.'� Wyndham uthlake Corne Plaza �'
� '* � -r'° Gateway Plaza .
•+w � p 1t.0 : Shafer Plaza ■ ,
t " r Cornerstone Plaza.
-
Sou thlake Town Squar soucnio Southlake Town Squa
sou
By Cooper & Stebbins _ --71 .21 .
rf3l VH*".7'• !25 Total acres 1' r ggg
• Ultiy 2M squara feat l el ■ Current) 00 sf A
1,1tr Ret ail2655,9°62C):307 of 9 im�� ` f r �� '1 ��� ''� r � " `� • Restaurants ,000 of
�% " _ • Of we: 204,000 sf- sota tv.aa � 1 . ewe e ® #
;; �� [[ °' ■ Touv H 78,000 sf r ''',,I.,, ' t # T � ":
� �ffi`` { ? ■ Post Office 22,000 sf va, , 2 , , '
+ f mi l i r3
Southlake Town Square so Southl Town Hall s
ri „„ ,s7 "? o e De. 2008
a pone
Yom° x 78,000 S F
uare F ee t
Dii i 4 ; – 3
County Offices
x F - ,
k '''J' .. t _
Comtable CounlY Clerk °' '- Count Cam
� ' ' y - Justice of the P nce
s. `_"'""'`' .w. ...... _. Public Health Dept
I ' , `� s •Tex Collector /Aesasor
.t F - c�ro orr
' . ` ',; k d / w '" ''''''%. - 2 • cit Manager .: GIS / Syc tems •Public Library
'„ %,,,�, =,sy • ` l r g� "� ' • City Secretary Hu Rerources •Public Safety k Su b- Snlion
$� ■ —',-..-'-'.._'•`". i •Economic Development Mn Courl • Publi c W or s
r s - • Finance • Planning •Utility Billing
—
Southlake Town Square i l ke S outhla ke Town nst S q uare S tnlOke,
Residential Brownston
__ — R esidential Brow
Mom Street Elevation � r, s t�
° r j e ; n , { 'i 1 , ,41 , 1 9 ' f. Ri E "' , €L �4 ` y l � - r. � � 4 4:1 q ,
" €a, ® lea � .;$� i
`' 1L • 115 Total Units ' �: F *. a
` n .e � �a}t,��
t 29 Phase 1 units ' t tt . ` `1;� i� `�a 1
���� .Valued $400,000 and up - ' _ t ' ,
� $ ' : I ➢ •Targeted to empty- nesters �• • • , ,�
.w—
f 1 dti , i
. I - _ Brownstones' Site Plan Location Map
Southlake Town Square S_hIo a Southlake Town Square
Southlake
a' 1 A u.a...+ .. 4 L ' Y $ e g " qv
$ : . c w t , S y s `fix : F c °` g;y sue+ �i. i
p S -- , ,r,i'-'',7".':c.i7-?% ' .- Sr::( ' 1 _ t rap _
i' { ` .� � ar *% !j .1 ; s _ i -e
' V . _ tea
-46=
Southla Town Square s rti e Southlake Town Square S e
E h p ri
el t S Id
p,, 0 wry , .' , ..4.-.-. R' .:'
:_ y am.
�
r+ ..fi
—
Southlake Town Square sou ok Southlake Town Square sa ke
, Pvgk
' "" z , ._f .�. � w *« � ",9i •'mot
,, - at z � ° w
'` F a A Developmen y C ooper &Stebbins
TO WN SQU .
-` ' "� uare.com
www.s outhlaketo wnsq
���' Sabre Hold s.ke
!--1 ,..,....._..c,,...
Solana Mas ter Plan sautni e
World Headquarters
q iwt Solana - By Maguir Partners n ;«n .. ; / t9- -a, ;'A
r „,.:...-,:s Sabre HeadSUarlers *.. r . .
IIIYYY E�„ ..: .�
I ' l ' ' , �,� Verizpn wlrtle.+ _ � ? :.,." ; .. ° ar , d
y f
c . 4 .. ' p
t Ph L• Dec ember, 2001
■ 880 Totd Am. 474,000+5. n, 510OM, 1,100 people
■ 1,115,000 SF in Westlake C.npas t i a E+btbg bldg .egebbloo • • 563,000 SF in Village Center j
Over 2 m01bo+5aare fee4I0,000 employee
• Solana Marriott Hotel - 200 Aooms `\ v
...
Named "Top 10 ReN Estate Project •
Notion by Sti e Seleenan magooine
Verizon Wireless ter s. Solana So e
Networ Co ntrol Cen L — ,' �� ■ ph ase I: August, 2003 j a �` r _ + t I d',r" �,. * 25 300 a cres (PUD ca ning) Y � �-�
'.,ft 187, sq. ft., S Fri
q ( k e mployees
�.,,� � r �,� • P o t e n t i a1350 000 sf •
g $. :-ter ? A fi � .
As al h .,_
s; y A
4_
Solana Club S•u a Solana Marriott sou_thl
r_i : 4
w is
s r z : ,.4'',-,-, a
. - X11 a.:' _ ..:a. �v `. �` f
§ lit. fi �':9 r , +dimes'{ . i . 4 i f 4 , : ' ' '' ; ' , ',„ , :i4-'7_=1:- . . K : i
, �:.r,,*�, ^"'.`' l ��.� p ® @, .1 .. z
Solana — Westlake Campus Southlo a 5°u'thl
Solana — Tenants -
• Boy Scouts o
• f Amer ■Maxtor
_i' _ im ler Chrysler
■Pfizer, Inc
• IBM ■Sabre Holdings
• Levi Strauss ■ Solara Health Care
w ■Lucent Technologies • Sonitrol
cam ,F ,
••
McKesson HBOC ■ Wells Fargo
�� 1:, Y r . :' 'F l6Se "� ° VAS R"' � g
Fidel Investments So_u
Properties cia 1
—
south ICe
Gateway P
(Westlake) — ,,,�,,,.-
a
,s ';,,C 3' y -+ ■ P hase I - Occupiec ■ Terry Wilkinson
'� ��. " ' Ts Lincoln
�y 1 'd" • 3 Acres " �
e , 1; a ' "` ,�
-a',�isn � ■ 615,000 Sq. Ft x '' s roc e s "''° ■ SP -2 Commer
3 ■■� ■ `,`� t W`w 4�g�r �q s� ° x a ._. Zoning
y y , eon ■ 2,450 Structured t ¥¥
e `c'; i • 38 Acres
4l "' y!e
tel Parking stalls r ,
° r P3� x
■ 357,000 LL ,. w.. ' • 2,300 Employees !. ,� 3 - e " „ ' ; ' ,,IA.,
— ■ Au ditorium will f x 4 s?: <:`,�
^ „ �+' a . seat 250 A' "!x ',X"' .. ;:.
s . w,
I_
Gateway Plaza � �!e Wyndham Pla so •
—
., �'— '—" ■ Terry o-
� '� _ ',..L,...4.1..-;;;-1, '` } - � co mm Z onin 2
g
j.'e -. • i EC31 . G L. �'$ 4
s s , g �13c 1 �1 { °O _ " + : ■ 39.5 Acres
� ( Co 1 FU v 1, 1r ■ 349,000 s.f. (max)
�I �' ' . Sales tax revenues
,X. w ,., 't' - /(//"1,,
� s a^" �; , , .L;� _. - + ,! - � esti over 52.5
� �� � £ � � E million
• � � � ��� � ■ Top Sell Cos[co in
''..r 4. / ' Texas!
t k al
s ou ► . Ik e Aventerra -Tract 1 s ole
AventeYYa -Tract Orien __ k
The Grove Link
^s t - ''',;1,t-
t om:1 ° ° *r ;' 4 *, S
( r K . 5 6 N b R fi . =
��h® w���� '� � ,w s� < -de T °a
� �� a 95 � i 'a ' ng
Aventerra - Tract 2chloke AventerraFutureGrowth -Tract 3 s
The Corporate Center I Unk .... � _ I u
i , , . r te .
i i b „ x l
t /IV 3 11 , \ ,,,,)1 . '''
C ° n' 1 .0 i r " ;€- � # i ;, f oevetapmen A , ( P
51 Granite Corporate Center e ke Cedar Ridge sou thlooke
at Aventerra I .�
- I CI
■ Granite Properties - '' ■ Panattoni
�� ■ 7 Acres ■ 15.28 acres
:e ■ 150,000 sf ;( i* ■ Two -story 101,550 sf
sr■ w¢ ' '°' • 25,000 sf per floor ■ Parking below
x ' .,'" s r -, is Lease 2,000 sf and up ■ Additional owner -
r
-
• 1 -t i occupied bldgs.
${ ,, y • Bank & retail
D eep South southla a Southlak Corn satl-rnioke
- Ae A . �
1 A kt �,.ay,l �, . : 3 h. s ;dam+ '.s e F 4S�� a
1 a,' -.w ■ Archon Retail
P • 16. Acre
qa' ,r. ■ ,4:300s f on 6 acres gi
u ■ (60 for Deep South a ■ 110,812 sf
l a sv
f ""' 1 ` wit91 000 sub - le i !e i t o ■ Comp letion 4Qtr 04
,, �f,,, ■ emplo 4. a e •.� +m 1
y 5
3 a ■ Beg occu pancy 3Q[r 04 in with 2Q[r OS
1 * .n e ul i � o� .
w 5' ` f jlW�l,:rc�tss e s ,
'MS1.�t i e pp
°' v .a wrw Tawm �yx. t
Southlake Website P Obi
Southlow Analyst's Questions & Remarks Soucnloke
www.ci.southlake.tx.us
• Continued progress of SH 114 development
Ply arsaea.t.. t -
,
• Redevelopment of Wal -Mart
un.. "..4_,.,
• Impact of overlapping debt
, "` Ili • Transition from high - growth to maturing city
b
.> • Responsiveness to economic times
'+ °' � • Strong financial management
• Continuity of the Southlake story
MOODY'S ASSIGNS Aa3 RATING TO CITY OF SOUTHLAKE [TX] $37.4
MILLION OF GENERAL OBLIGATION DEBT
RATING AFFIRMATION AFFECTS APPROXIMATELY $128 MILLION IN
OUTSTANDING DEBT, EXCLUDING CURRENT ISSUES
Southlake (City of) TX
Municipality
Texas
Moody's Rating
Issue
Rating
General Obligation Refunding Bonds, Series 2004
Aa3
Sale Amount $31,535,000
Expected Sale Date 05/17/04
Rating Description General Obligation, Limited Tax
Tax and Waterworks and Sewer System (Limited) Revenue
Certificates of Obligation, Series 2004
Aa3
Sale Amount $3,025,000
Expected Sale Date 07/07/04
Rating Description General Obligation Limited Tax
Tax and Waterworks and Sewer System Surplus Revenue
Certificates of Obligation, Series 2004A
Aa3
Sale Amount $2,965,000
Expected Sale Date 07/07/04
Rating Description General Obligation Limited Tax
NEW YORK, May 14, 2004 -- Moody's Investors Service has
assigned a Aa3 rating to the City of Southlake's [TX] $31.5
million General Obligation Refunding Bonds, Series 2004;
$3.2 million Tax and Waterworks and Sewer System (Limited
Pledge) Revenue Certificates of Obligation, Series 2004;
$2.97 million Tax and Waterworks and Sewer System Surplus
Revenue Certificates of Obligation, Series 2004A. At the
same time, Moody's affirms the Aa3 rating on the City's
approximately $128 million in outstanding parity debt.
Factors contributing to the high - quality rating include the
City's very favorable socioeconomic profile and
transitioning tax base that continues to experience growth,
strong financial operations, and a higher but manageable
debt position that improves when considering ongoing
support by various revenue sources to retire property tax
secured debt. Proceeds from the sale of Bonds will be used
to refunding existing debt for a substantial net present
value savings of 8.5% of the refunded principal. Annual
principal and interest payments are secured by the levy and
collection of a direct and continuing ad valorem tax,
within the limits prescribed by law, on all taxable
property within the City.
The City of Southlake is located in Tarrant County (general
obligation rating
Aaa) approximately 5 miles northwest of DFW airport and
directly south of Grapevine Lake, its namesake. As a result
of healthy high -end residential construction throughout the
1990s and early 2000s, the City's tax base expanded at an
annual rate of over 15% with some years exceeding 30%
during the period from 1996 through 2002. The character of
the residential development is reflected in the change in
median family income that increased from 96% of the US in
the 1980 census to 272% for the comparable value as
reported from the 2000 census. However, Officials indicate
that property zoned for single- family housing is 85%
developed. Indicative of this change is the most recent two
years of 2003 and 2004 that resulted in solid but more
modest growth rates in the city's taxable assed value of
8.4% and 7.6%, respectively. This trend is affirmed in the
city's residential building permit activity that has
moderated from 441 issued in FY 1999 to 128 for FY 2003.
Much of the remaining developable property is zoned for
commercial office and retail. Although commercial office
development within the region has moderated over the past
few years the completion of roadway infrastructure within
and through the city continues to make available property
appealing to the development community. Moody's believes
that as ongoing and planned development adds value to the
tax roll, the City's assessed valuation will expand at
rates more reflective of recent years. Additionally,
Moody's notes that officials continue to display
conservatism in the assumed growth rates utilized for
budgeting and capital planning purposes.
Preliminary unaudited results for FY 2003 indicate that the
city will post a general fund operating surplus of $1.3
million, which is the fifth consecutive year of an
operating surplus. These additions to the general fund
balance have allowed the city to bolster its already solid
financial reserves to $8.9 million, which is over 40% of
general fund revenues for FY 2003. The City's conservative
financial planning and commitment to maintaining sizable
general fund reserves is a credit positive and is
consistent with the Aa3 rating level. General fund
operating revenues are primarily derived from property
taxes (44%) and sales taxes (19%) however the city has
additional sales tax levies that are utilized to support
public safety and park activities. Sales tax collections
have increased 13.9% on average over the past four years as
retail offerings have increased significantly as a result
of the Town Square and similar developments. Despite the
loss of a major retailer in FY 2004 officials report that
year -to -date sales tax collections exceed budget estimates
by $300,000 and prior year results by approximately 5 %.
After this issue, the City's direct and overall debt ratios
are higher at 4.0% and 7.5% respectively, both expressed as
a percent of assessed valuation. When excluding debt that
has historically been supported by water and sewer
revenues, the direct and overall debt ratios are reduced to
the more manageable levels of 3.5% and 7.0 %, respectively.
After this sale the remaining authorized general obligation
debt will be $10.5 million from a May 1999 authorization.
Issuance of that debt has been programmed into the city's
capital improvement program that is scheduled through FY
2008. Additionally, officials anticipate selling the above
rated $6 million in Certificates of Obligation in July 2004
to finance utility system capital improvements. The City's
moderate debt profile benefits from a solid rate of
principal repayment with 49% retired in ten years.
Additionally, with solid tax base growth continuing over
the medium term, Moody's believes the City's debt position
will remain manageable.
KEY STATISTICS:
2004 Estimated Population: 24,150
2004 Full Valuation: $3.5 billion
2004 Full Valuation per Capita: $146,493
Direct Debt Ratio: 4.0 %; excluding self - supporting debt:
3.5%
Payout of Principal (10 years): 49.1%
FY 2003 Unaudited General Fund balance: $8.9 million (41.3%
of General Fund
revenues)
Sales Tax Debt Outstanding: $21.9 million
ANALYSTS:
Douglas Benton, Analyst, Public Finance Group, Moody's
Investors Service Sarrah Angelos, Backup Analyst, Public
Finance Group, Moody's Investors Service
CONTACTS:
Journalists: (212) 553 -0376
Research Clients: (212) 553 -1653
Copyright 2004, Moody's Investors Service, Inc. and /or its
licensors including
Moody's Assurance Company, Inc. (together, "MOODY'S "). All
rights reserved.
ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY COPYRIGHT
LAW AND NONE OF SUCH
INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED,
REPACKAGED, FURTHER
TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR
RESOLD, OR STORED FOR
SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART,
IN ANY FORM OR MANNER
OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S
PRIOR WRITTEN
CONSENT. All information contained herein is obtained by
MOODY'S from sources
believed by it to be accurate and reliable. Because of the
possibility of human
or mechanical error as well as other factors, however, such
information is
provided "as is" without warranty of any kind and MOODY'S,
in particular,
makes no representation or warranty, express or implied, as
to the accuracy,
timeliness, completeness, merchantability or fitness for
any particular
purpose of any such information. Under no circumstances
shall MOODY'S have any
liability to any person or entity for (a) any loss or
damage in whole or in
part caused by, resulting from, or relating to, any error
(negligent or
otherwise) or other circumstance or contingency within or
outside the control
of MOODY'S or any of its directors, officers, employees or
agents in
connection with the procurement, collection, compilation,
analysis,
interpretation, communication, publication or delivery of
any such
information, or (b) any direct, indirect, special,
consequential, compensatory
or incidental damages whatsoever (including without
limitation, lost profits),
even if MOODY'S is advised in advance of the possibility of
such damages,
resulting from the use of or inability to use, any such
information. The
credit ratings and financial reporting analysis
observations, if any,
constituting part of the information contained herein are,
and must be
construed solely as, statements of opinion and not
statements of fact or
recommendations to purchase, sell or hold any securities.
NO WARRANTY, EXPRESS
OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS,
MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR
OTHER OPINION OR
INFORMATION IS GIVEN OR MADE BY MOODY'S IN ANY FORM OR
MANNER WHATSOEVER. Each
rating or other opinion must be weighed solely as one
factor in any investment
decision made by or on behalf of any user of the
information contained herein,
and each such user must accordingly make its own study and
evaluation of each
security and of each issuer and guarantor of, and each
provider of credit
support for, each security that it may consider purchasing,
holding or
selling. MOODY'S hereby discloses that most issuers of debt
securities
(including corporate and municipal bonds, debentures, notes
and commercial
paper) and preferred stock rated by MOODY'S have, prior to
assignment of any
rating, agreed to pay to MOODY'S for appraisal and rating
services rendered by
it fees ranging from $1,500 to $2,300,000. Moody's
Corporation (MCO) and its
wholly -owned credit rating agency subsidiary, Moody's
Investors Service (MIS),
also maintain policies and procedures to address the
independence of MIS's
ratings and rating processes. Information regarding certain
affiliations that
may exist between directors of MCO and rated entities, and
between entities
who hold ratings from MIS and have also publicly reported
to the SEC an
ownership interest in MCO of more than 5%, is posted
annually on Moody's
website at www.moodys.com under the heading "Shareholder
Relations - Corporate
Governance - Director and Shareholder Affiliation Policy."
Fitch Public Finance
Tax Supported Southlake, Texas
New Issue
Ratings • Outlook
New Issues The `AA —' rating represents Southlake's continued tax base growth
General Obligation Refunding and diversification, strong local economic profile, sound financial
Bonds, Series 2004 AA management, and healthy reserves. Also incorporated in the rating are
Tax and Waterworks and Sewer the city's above - average debt burden and capital and operational
System (Limited Pledge) demands associated with growth. The city has experienced impressive
Revenue Certificates of taxable assessed valuation (TAV) and sales tax growth over the past
Obligation, Series 2004 AA seven years, though recently slower, and has added retail and office
Tax and Waterworks and Sewer
System Surplus Revenue developments to its historically residential tax base. Additionally, the
Certificates of Obligation, income and employment characteristics of Southlake are positive.
Series 2004A AA Despite the operating and capital pressures associated with growth, the
city has prudently managed its finances, provided the necessary
Outstanding Debt infrastructure and services, and created altemate funding sources for
General Obligation Bonds AA capital improvements. The Rating Outlook is Stable.
Certificates of Obligation AA—
Tax Notes AA—
• Rating Considerations
Rating Outlook Stable City finances have demonstrated solid operating results, with an
unaudited fiscal 2003 general fund balance of $8.9 million,
Analysts representing 44% of expenditures and transfers out, or 173 days of
Carrie Deason operations. While the fiscal 2004 budget projects a modest general
1 512 322 -5329 fund balance drawdown, the projected ending fund balance of 22% of
carrie.deason @fitchratings.com expenditures and transfers out is healthy. Furthermore, actual results
Steve Murray have historically outperformed budgeted expectations. The city has a
1 512 322 - 5318 fund balance policy of at least 15% of expenditures and transfers out,
steve.murray @fitchratings.com and prior fiscal period fund balances are consistent with this policy.
Issuer Contact Growth in TAV has averaged approximately 20% over the past five
Sharen Elam years, reaching $3.5 billion. Until 2002, the city had not increased the
Chief Financial Officer property tax rate for 10 years. The property tax rate remains low at
1 817 481 - 1713 $0.462 per $100 of TAV. The property tax base is primarily
residential, estimated at 71% for 2004. Sales tax growth has been
See page 2 for New Issue significant to the city. The 10 -year average actual sales tax growth is
Details. 26 %, the five -year figure is 23 %. A crime control and prevention
district and park development corporation, both established to fund
infrastructure and operations, are reliant on separate, dedicated sales
tax revenue.
Direct and overall debt per capita are high, as are direct and overall
debt to TAV. Overlapping debt is primarily influenced by school
district debt. Principal amortization is average. Debt service as a
percentage of general fund and debt service fund expenditures, while
above average at nearly 20 %, is not unusual for high - growth cities. No
tax rate impact is projected as a result of the current financings. The
city has approximately $10.5 million remaining from a May 1999 voter
authorization of $24.2 million.
May 17, 2004
www.fitchratings.com
Fitch Public Finance
New Issue Details • Strengths
• Sound financial operations and reserves.
$31,500,000 General Obligation Refunding Bonds, Conservative management and financial policies.
Series 2004, are scheduled to sell May 17, via
• Expanding and diversifying tax base.
negotiation through RBC Dain Rauscher, Inc. • Establishment of supplemental infrastructure
$3,025,000 Tax and Waterworks and Sewer
System (Limited Pledge) Revenue Certificates of funding sources.
Obligation, Series 2004 (the 2004 certificates), and
•
$2,965,000 Tax and Waterworks and Sewer Risk
System Surplus Revenue Certificates of • High per capita debt ratios, mitigated somewhat
Obligation, Series 2004A (the 2004A certificates), by substantial support from nonproperty tax
are scheduled to sell on or about June 1 via sources, and moderate debt to TAVs.
negotiation through RBC Dain Rauscher, Inc.
Dated June 1, 2004, the bonds will mature serially • Debt
on Feb. 15, 2008 -2010 and 2012 -2026, the Direct and overall debt per capita are above average, at
2004 certificates will mature serially on Feb. 15, $2,206 and $7,673, respectively, including these
2005 -2024, and the 2004A certificates will mature issues. In terms of TAV, direct debt is moderate and
serially on Feb. 15, 2005 -2024. Bonds and overall debt is above average, at 1.5% and 5.3 %,
certificates maturing on and after Feb. 15, 2014 respectively. These ratios also consider the self -
are callable beginning Feb. 15, 2013 at par plus supporting nature of debt issued to fund improvements
accrued interest. in the waterworks and sewer enterprises.
Security: The bonds and certificates are direct
obligations of the city, payable from a limited ad Amortization of property tax- supported debt is below
valorem tax on all taxable property in Southlake, average, with 8.3% and 36% retired in five and 10
subject to a maximum rate of $2.50 per $100 of years, respectively. Including the self - supporting
assessed valuation. The certificates are waterworks and sewer system and Trinity River
additionally payable from a limited pledge of Authority debt, amortization is slightly more rapid at
water works and sewer system revenue. 21.4% retired in five years and 49.1% in 10.
Proceeds: Proceeds from the sale of the bonds Overlapping debt is influenced primarily by school
will be used to refund tax- supported and tax district debt. The city has issued $13.7 million of
increment revenue supported debt outstanding for $24.2 million authorized by voters in May 1999.
debt service savings. Proceeds from the sale of
the 2004 certificates will be used for street and The series 2004 and 2004A certificates carry an
drainage improvements. Proceeds from the sale of additional limited pledge of the city's waterworks and
the 2004A certificates will be used for sewer system revenues. As in past water and sewer
improvements and extensions to the city's system improvements, either all or the allocable portion
combined waterworks and sewer system. of debt service from outstanding obligations will be paid
from the enterprise fund and is considered self -
Southlake, with an estimated 2004 population of supporting.
24,510, is located in northeast Tarrant County
approximately 15 miles northwest of Dallas and Debt Statistics
10 miles northeast of Fort Worth. The city is also five
moo)
miles northwest of the Dallas-Fort Worth International
Airport and 10 miles from Alliance Airport. The city's This Issue 37,525
boundaries encompass 23 square miles, making it the Outstanding Debt 16.546
fourth Largest city in the county. Southlake is Direct Debt 54,071
80 %-85% developed residentially and projects a total Overlapping Debt 133.986
Total Overall Debt 188,057
build -out population of nearly 36,000. While the city
continues to enjoy residential development, the Debt Ratios
recently improved State Highway 114 corridor and the Direct Debt Per Capita ($)* 2,206
expanded Farm -to- Market Road 1709 that intersect the As % of TAV ** 1.5
Overall Debt Per Capita ($)* 7,673
city have attracted retail and commercial construction. As % of TAV** 5.3
*Population: 24,510 (2004 estimate).
* *Taxable assessed valuation (TAV): $3,537,818,000 (fiscal 2003).
Southlake, Texas
2
FitchRatings Public Finance
General Fund Summary
($000, Audited Fiscal Years Ended June 30)
1999 2000 2001 2002 2003*
Revenues 14,290 16,453 17,186 20,545 21,470
Expenditures 14,862 16,302 16,894 17,962 19,432
Net Change (572) 152 292 2,583 2,038
Transfers In 939 1,236 210 0 0
Other Sources 708 0 402 0 133
Transfers Out (299) 0 0 (820) (798)
Net Income 777 1,387 904 1,763 1,373
Total Fund Balance 3,635 4,973 5,777 7,540 8,915
As % of Expenditures, Transfers Out, and Other Uses 24.0 30.5 34.2 40.1 44.1
Unreserved Fund Balance 3,563 4,889 5,658 7,394 N.A.
As % of Expenditures, Transfers Out, and Other Uses 23.5 30.0 33.5 39.4 N.A.
Undesignated Fund Balance 3,563 4,763 5,573 7,296 N.A.
i As % of Expenditures, Transfers Out, and Other Uses 23.5 29.2 33.0 38.8 N.A.
`Unaudited. N.A.— Not available. Note: Numbers may not add due to rounding.
A portion of the proceeds from the general obligation • Economy
refunding bonds, series 2004, will be used to refund The population of Southlake has increased nearly
outstanding tax and tax increment financing revenue 14% from its 2000 census population to a 2004 census
certificates of obligation. The city council authorized the estimate of 24,510, nearly three times the 1990 census
creation of a tax increment reinvestment zone in population. For Tarrant County, growth in the civilian
September 1997, which includes the participation of other labor force has been outpaced by an increase in
local governments. The city has established one such employment for the seven consecutive years
zone, the Tax Increment Financing Reinvestment Zone 1997-2003. The city's unemployment rate in March
Number One, comprising approximately 408 acres. Taxes 2004 was 3.2 %, significantly below the Tarrant County
assessed and collected against the TAV of real property in and national levels of 6.3% and 6.0 %, respectively. At
the reinvestment zone in excess of an established tax 29.4 %, services led the county's 2003 employment
inc utent base, the tax increment revenues, are restricted indicators, followed by wholesale/ retail trade (23.1%),
to pay or finance projects within the zone. manufacturing (11.8 %), and government (10.5 %). The
largest employers in the city are the Sabre Group,
• Finances 1,100 employees; the Carroll Independent School
The city's general fund has performed admirably in District, 874; Tri-Dal, Ltd. (construction), 450; and
each of the past five consecutive fiscal years, Verizon Wireless, 315.
generating general fund balances of at least 22% in
each fiscal year and unreserved fund balances of at Per capita personal income in the county for 2000
least 21% since fiscal 1998 and at least 30% since was $30,110, representing 108% of state and 102%
fiscal 2000. Fiscal policy outlines a minimum of national levels. The 2003 median household
unencumbered fund balance of 15% and a maximum buying income was $43,048, well above state and
of 25% of expenditures. national levels.
Liquidity has been equally sound, with cash and cash Although the value of issued building permits has
equivalent balances of at least $3.3 million since declined substantially since fiscal 2000, indicating a
fiscal 1998, and more than twice that figure in recent slowing of both commercial and residential growth,
years. Property tax collections have been exemplary, year -to -date building permit values for fiscal 2004
with current collections averaging more than 98.5% are in line with 2003 values and above expectations.
for the past six years and total collections averaging Information provided by the city cited average new
more than 100% for the same period. Until 2002, the home construction value of more than $370,000,
city had not increased the property tax rate for 10 excluding land value.
years. The property tax rate remains low at $0.462
per $100 of TAV.
Southlake, Texas
3
•
F Public Finance
Copyright ® 2004 by Fitch, Inc., Fitch Ratings Ltd. and its subsidiaries. One State Street Plaza, NY, NY 10004.
Telephone: 1- 800 - 753 -4824, (212) 908 -0500. Fax: (212) 480 -4435. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved. All of the
information contained herein is based on information obtained from issuers, other obligors, underwriters, and other sources which Fitch believes to be reliable. Fitch does not audit or verify the
truth or accuracy of any such information. As a result, the information in this report is provided "as is" without any representation or warranty of any kind A Fitch rating is an opinion as to the
creditworthiness of a security. The rating does not address the risk of loss due to risks other than credit risk unless such risk is specifically mentioned. Fitch is not engaged in the offer or sale of
any security. A report providing a Fitch rating is neither a prospectus nor a substitute for the information assembled, verified and presented to investors by the issuer and 0s agents in connection
with the sale of the securities. Ratings may be changed, suspended, or withdrawn at anytime for any reason in the sole discretion of Fitch. Fitch does not provide investment advice of any sort.
Ratings are not a recommendation to buy, sell, or hold any security. Ratings do not comment on the adequacy of market price, the suitability of any security for a particular investor, or the tax -
exempt nature or taxability of payments made in respect to any security. Fitch receives fees from issuers, insurers, guarantors, other obligors, and underwriters for rating securities. Such fees
generally vary from USS1,000 to USS750,000 (or the applicable currency equivalent) per issue. hi certain cases, Fitch will rate all or a number of issues issued by a particular issuer, or insured or
guaranteed by a particular insurer or guarantor, for a single annual fee. Such fees are expected to vary from USS10,000 to USSI 500,000 (or the applicable currency equivalent). The assignment,
publication, or dissemination of a rating by Fitch shall not constitute a consent by Fitch to use its name as an expert in connection with any registration statement filed under the United States
securities laws, the Financial Services and Markets Act of 2000 of Great Britain, or the securities laws of any particular jurisdiction. Due to the relative efficiency of electronic publishing and
distribution, Fitch research may be available to electronic subscribers up to three days earlier than to print subscribers.
Southlake, Texas
4
ST .NDARI3 =_ _ = — --
614,_)()ICS
Publication date: 17- May -2004
Reprinted from RatingsDirect
City of Southlake, Texas
Credit Analysts: James Breeding, Dallas (1) 214 -871 -1407; Theodore Chapman, Dallas (1) 214 -871 -1401
credit Profile Rationale
US$3.025 mil Tax & Wtrwks & Standard & Poor's Ratings Services raised its Standard & Poor's underlying
Swr Sys (Ltd Pledge) Rev rating (SPUR) on Southlake, Texas' GO debt outstanding one notch to 'AA'
0 /2 0big, seder 2004
024 f rom 'AA -' based on the ci 's maturation, resultin in a moderatin debt
06/01/2004 due 02/15/2024 tY 9 9
AA burden and fewer capital needs.
Sale date: 18-MAY -2004
US$2.965 mit Tax & Wtrwks & : Standard & Poor's also assigned its 'AA' standard long -term rating, and stable
Swr Sys Sur Rev Carts of outlook, to the city's series 2004 and 2004A certificates of obligation and
Ob lig, Series 2004A dtd s eries 2004 GO refunding bonds.
06/01 /2004 due 02/15/2024 g
AA
Sale date: 18- MAY -2004 The rating reflects the city's:
US$31.535 mil GO Rfdg
Bonds, Series 2004 dtd
06/01/2004 due 02/15/2026 • Demonstrated ability to manage through a period of rapid growth;
AA • Very high wealth and income levels that continue to increase;
Sale date: 18-MAY -2004
• Predominantly residential property tax base, which has exhibited
UPGRADED steady growth and continued diversification; and
Outstanding Tax More Rfdg
Rev Bonds, Series 2003A • Sound financial management with healthy reserve levels.
(Reinvestment Zone #1)
To AAA / AA (SPUR)
From AA- High debt per capita, however, remains a credit concern.
Outstanding GO Bonds, Series
2000 The city's full faith and credit pledge secures the bonds and certificates.
To AAA / AA (SPUR)
From AA-
Southlake, which is in northeastern Tarrant County between Alliance and
OutstandingGORfdg & Imp Dallas -Fort Worth International airports, is transforming into a city tasked with
Bonds, Series 2003
maintaining a high service level to a largely built -out community from one
ToAAA /AA(SPUR) 9 9 9 Y ty
From AA- dealing with rapid growth- related issues. Population has grown by an average
Ouistanding,GE) Rfdg Bonds, of almost 10% annually since 1990 to about 24,000 in 2004. Growth
series2002 projections indicate the city will be built out once it reaches a population of
To AAA /AA(SPUR)' about 30,000. Wealth and income levels have also increased over the past
From AA- few years. Given strong property tax base growth, market value is more than
Outstanding Tax 8, Ltd Pledge $145,000 per capita and average household income is roughly $150,000,
Rev Cert of Oblig, Series 2000 ; which is evident in the new -home price average of more than $400,000.
C Population growth has triggered retail and commercial construction along
To ro AAA /AA(SPUR) ' several thoroughfares, which contributed to a 7.5% assessed valuation (AV)
increase since fiscal 2003 to $3.54 billion in fiscal 2004. The property tax base
Outstanding Tax &Taxlncre has increased by 60% since fiscal 2000.
Rev Certs of Oblig, Series
2000 -8, 2000 -E (Reinvestment
Zone #1) Southlake's financial performance remains sound. Even though the city had
To AAA /AA(SPUR) a draw down of reserve levels in fiscal 2003, it reported a general
From AA- projected P 9
fund surplus due to sales tax revenue increases and ended the fiscal year
Outstanding Tax & wtrwks & with a roughly $8.9 million unreserved balance, or about 40% of expenditures.
Swr Sys Surplus Rev Certs of The city has again budgeted for a draw down of the reserve level in fiscal
Oblig, Series 2000-A 2 004, but preliminary g
To AAA /AA(SPUR) p estimates indicate the balance will remain well in excess
From AA- of its minimum fund balance policy.
$14.060 mil. Southlake tax &
wtrwrks & swr sys (ltd pledge) ; The overall net debt burden remains high at about 7.5% of AV due primarily to
rev carts of oblig ser 1999 dtd bonds issued by the overlapping local school district servicing the community.
04/01 /1999 dos 02/15/2000- Y PP 9 9 tY
2019 Absent that overlapping burden and giving credit for the self - support of a
AAA /AA(SPUR) significant amount of bonds outstanding, the direct debt ratio is favorable at
AA, less than 2% of AV. The city's capital program has also become more
$7.320 mil. Southtake'tax & manageable. The city estimates it will need roughly $24 million of tax -
wt rvvrks a swr sys surplus rev supported certificates obligation between fiscals 2004 and 2008, which
� of o btig se 20 - dhi pp es o g
1 2/0 9 120 0 due 02/9512002- management can accommodate without increasing taxes.
2017 2021
AAA/AA(SPUR)
AA- Outlook
OutstaadingTax & Increment The stable outlook reflects the expectation that the city's basic demographics,
Rev certsofOblig including high wealth indicators, will remain unchanged while it maintains a
(Reinvestment Zone #1), moderate debt burden and sustains a healthy financial position.
Series 2003A
To MA /AA (SPUR)
From AA- Economy
Outstanding Tax 8 wtrvuks Southlake is a primarily residential community in the Dallas -Forth Worth
swr sys (Ltd Pledge) Rev Cert ! Metroplex, about 15 miles northwest of Dallas, Texas and 10 miles northeast
ofObtig, Series 1998, 2003 of Fort Worth, Texas. The city is five miles northwest of Dallas -Fort Worth
To AAA /AA(SPUR) International Airport and 10 miles from Alliance Airport. This access to the
Frcsm AA airports, as well as large tracks of developable land fronting State Highway
Outstanding Tax RevCertof 114, has allowed the city to compete for corporate campuses; Southlake,
Oblig, Series 2000 however, faces numerous competitors for this type of development, including
ro' AAA /AA (SPUR) i
I
li
C
Las Colinas (Irving, Legacy (Plano, Texas), Center
From AA- 9. ), 9 Y ) ort Fort
P
Worth), as well as other scattered sites throughout the region that also have
OUTLOOK good transportation access and available housing. The city, however, has
STABLE faired well recently with Sabre Corp.'s expansion to its facility; the company
now employs about 1,100 at its nearly 850,000- square -foot facility. In addition,
Verizon Wireless has located its network observation and control center on a
25 -acre tract of land in the city. With the opening of the mixed -use Town
Center development in March 1999, Southlake has been able to attract
upscale retail outlets, restaurants, and professional firms to the office -space
portions of the 448,000- square -foot development. In addition to Town Center,
the opening of Gateway Plaza added 357,000 square feet of retail space to
the city's property tax base.
Southlake expects high -end residential development to continue but at a
reduced pace. Less than 20% of land zoned for low- density residential
housing and about 11% of land zoned for medium - density residential housing
remain available for development. Roughly 22% of land zoned for retail
commercial development, 75% of the land zoned for mixed -use, and 33% of
land zoned for industrial use is still available. Infrastructure is in place to serve
the majority of these areas, so future development should allow the property
tax base to grow without significant capital outlay by the city.
Finances
Despite planned drawdowns of its historically high reserve level, Southlake
expects to continue to maintain a healthy financial position. Audited 2002
results indicated a surprising increase in the general fund balance to 42% of
operations. The fiscal 2003 budget indicated a decrease to about 20% of
expenditures; but absent the expected decline in sales tax receipts, the city
was able to experience another general fund surplus. Once again,
management budgeted a fund balance drawdown, this time in the fiscal 2004
budget; revenues to date, however, are above budget. City council policy sets
the unreserved general fund balance at a minimum of 15% and a maximum of
25% of expenditures. Property tax revenues remain the city's single largest
revenue source; the city is levying a tax rate, which was minimally increased
in 2003 for the first time in eight years, of 46 cents per $100 of AV. Property
taxes are budgeted to account for about 54% of general fund revenues while
sales tax revenues, the second leading revenue source, should total about
23 %. With the closing of a large retail store and the general decline in
spending across the region, this revenue stream has been under some stress
in recent years. The fiscal 2004 budget indicates a decline in sales tax
revenues, providing the city with a conservative revenue projection. In addition
to the one -cent sales tax collected for general fund operations, the city also
levies a half -cent sales tax for a crime prevention district, which allows it to
subsidize the funding of police and fire operations, especially the construction
and equipping of mixed -use police and fire facilities. The electorate renewed
the tax in 2002 and extended it for an additional 15 years. This revenue
stream will allow the city to address public safety infrastructure needs. The
city also levies a half -cent sales and use tax for Southlake Park Development
Corp. To assist the city in funding the new city hall, Southlake's first public
library, and parks and educational facilities in the Town Center development,
management created a tax increment reinvestment zone: The 408 -acre zone
will generate sufficient revenues to allow the city to service the debt, which
was used to fund the construction of the new city hall.
Debt
Overall net debt remains very high at more than $7,500 per capita; high
wealth indicators, however, offset this. In addition to debt issued by the city,
Southlake's residents are also responsible for a majority of debt issued by
overlapping Carroll Independent School District. The city's and school district's
rapid growth in recent years has caused them to issue debt to support the
infrastructure required to meet that growth. A large portion of the city's debt
has been issued to fund water and sewer projects; this debt, however, is now
self - supporting, which helps to moderate previously higher debt ratios.
Management has been creative in developing dedicated funding strategies to
meet the capital improvement program. In May 1999, the city held a
successful bond election for $24 million in street improvements, as well as
other transportation - related projects. The school district does not have any
authorized, unissued bonds remaining; so the overall debt burden and debt
per capita ratio could potentially moderate. Management estimates the total
tax rate will remain at its current level of roughly $3 per $100 of AV depending
on which school district and county the residents reside in.
The city is issuing three separate series of debt obligations. Management will
use bond proceeds to refund certain obligations outstanding and certificate
proceeds to finance enhancements to its waterworks and sewer system.
Management is projecting future tax - supported debt plans will be roughly $19
million through 2008 while the total five -year capital improvement program
could total as much as $55 million. Currently, about 47% of principal matures
by 2013 while some of the city's debt repayment extends to 2026.
This report was reproduced from Standard & Poor's RatingsDirect, the
premier source of real -time, Web -based credit ratings and research from an
organization that has been a leader in objective credit analysis for more
than 140 years. To preview this dynamic on -line product, visit our
RatingsDirect Web site at www. standardandpoors .com /ratingsdirect.
Published by Standard & Poor's, a Division of The McGraw -Hill Companies, Inc. Executive offices: 1221
Avenue of the Americas, New York, NY 10020. Editorial offices: 55 Water Street, New York, NY 10041.
Subscriber services: (1) 212 -438 -7280. Copyright 2003 by The McGraw -Hill Companies, Inc.
Reproduction in whole or in part prohibited except by permission. All rights reserved. Information has
been obtained by Standard & Poor's from sources believed to be reliable. However, because of the
possibility of human or mechanical error by our sources, Standard & Poor's or others, Standard &
Poor's does not guarantee the accuracy, adequacy, or completeness of any information and is not
responsible for any errors or omissions or the result obtained from the use of such information. Ratings
are statements of opinion, not statements of fact or recommendations to buy, hold, or sell any
securities.
The lli i +ti�'1�� l t OMIXIMeS