AGENDA CAPTION:
Title
Consider approval of Resolution 2026-32R, authorizing proceeding with Issuance of Certifications of Obligation and further directing the publication of Notice of Intention to issue City of San Marcos, Texas Combination Tax and Revenue Certificates of Obligation for certain projects for improving, constructing, equipping, acquiring, or designing the City's: airport; parks and recreation facilities; streets, alleys, and sidewalks; public safety facilities; stormwater management for flood control and drainage; technology infrastructure and facilities; electric utility system; and the payment of professional services in connection therewith including fiscal and engineering fees and costs of issuing the certificates of obligation related thereto in an amount not to exceed $15,255,000.00.
Body
Meeting date: February 17, 2026
Department: Finance and Engineering/Capital Improvement
Amount & Source of Funding
Funds Required: N/A
Account Number: N/A
Funds Available: N/A
Account Name: N/A
Fiscal Note:
Prior Council Action: September 16, 2025 - City Council approved the Fiscal Year 2026 Capital Improvement Program (CIP). February 3, 2026 - City Council received a presentation on the CIP projects included in the Fiscal Year 2026 CIP at a work session.
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Background Information:
The Fiscal Year 2026 Capital Improvement Plan (CIP) was approved during the budget process and adopted on September 16, 2025. At the February 3, 2026, City Council Work Session, Shaun Condor, Director of Engineering/Capital Improvements, presented an overview of the projects included in the plan, including previously deferred projects. CIP projects are funded by various sources, including cash, impact fees, grants, and debt obligations.
This item is for CIP projects that will be funded by certificates of obligation, excluding water and wastewater projects. Water and wastewater projects will be financed through a separate issuance of revenue bonds, as the Water and Wastewater Utility has its own bond rating and issues debt backed by utility revenues.
The first step in issuing certificates of obligation is for City Council’s consideration of a resolution directing the publication of a notice of intent. If approved, the notice will be published once a week for two consecutive weeks in the San Marcos Daily Record and continuously on the City’s website.
Projects to be funded by certificates of obligation cover multiple areas, including the airport, public safety, parks and recreation, streets, technology infrastructure, electric, and stormwater. Each project is tied to a specific fund, and the associated debt will be repaid by that fund.
The amount of debt obligations to be issued for each fund is below:
General Fund $8,655,000
Stormwater $4,250,000
Electric $2,350,000
Total All Funds $15,255,000
After the notice of intent is published, the final action required of City Council is consideration of an ordinance authorizing issuance of the certificates of obligation, scheduled for April 21, 2026. A summary of the timeline of events is included.
At the April 21 meeting, City Council will consider two ordinances, the first will authorize the issuance of the certificates of obligation (this agenda item) and the second will authorize the issuance of water and wastewater revenue bonds. Unlike certificates of obligation, revenue bonds do not require a notice of intent.
Total revenue bonds to be issued are $93,060,000, funding water and wastewater projects, including the wastewater treatment plant. These bonds will be repaid by the Water and Wastewater Utility Fund.
Water and wastewater debt obligations:
Water $4,620,000
Wastewater $8,440,000
Wastewater Treatment Plant $80,000,000
Total Projects $93,060,000
Combined total of certificates of obligation and revenue bonds: $108,315,000.
Council Committee, Board/Commission Action:
N/A
Alternatives:
N/A
Recommendation:
City Council approve the resolution authorizing proceeding with issuance of certificates of obligation and further directing the publication of notice of intention to issue the certificates in an amount not to exceed $15,255,000.