AGENDA CAPTION:
Title
Consider approval of Resolution 2024-209R, approving the Alliance Regional Water Authority (ARWA) issuing contract revenue bonds for the City of San Marcos in the aggregate principal not to exceed $49,485,000.00 including approval of the Bond Resolution and other related matters in accordance with the Regional Water Supply Contract; authorizing the City Manager, or her designee, to execute any necessary related documents; and declaring an effective date.
Body
Meeting date: October 15, 2024
Department: Utilities, Tyler J. Hjorth Director
Amount & Source of Funding
Funds Required: debt service beginning in spring FY25
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Funds Available: Click or tap here to enter text.
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Fiscal Note:
Prior Council Action: Council approval in 2008 for ARWA project participation; 2017-154R, 2019-203R, 2020-224R, 2022-237R, and 2023-208R approval of approximately $120,000,000 of debt; and other resolutions related to engineering services, etc.
City Council Strategic Initiative: [Please select from the dropdown menu below]
Public Safety, Core Services & Fiscal Excellence
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Comprehensive Plan Element (s): [Please select the Plan element(s) and Goal # from dropdown menu below]
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Master Plan: [Please select the corresponding Master Plan from the dropdown menu below (if applicable)]
Water Master Plan
Background Information:
The City approved and executed the Regional Water Supply Contract effective January 15, 2008 for the financing, construction and operation of the Regional Water Supply Project. The City has previously requested the ARWA issue a separate series of contract revenue bonds for the City in an amount not to exceed $103,415,000 to finance the City’s contribution to the design, construction and equipment of the Phase 1A/1B Improvements of the Regional Water Supply contract.
In December 2023, City Council approved the ARWA Board of Directors to approve a resolution authorizing Bond Anticipation Note(s) to provide project funding for the completion of Phase 1A/1B projects, with the agreement that the BAN would be paid off with 2024 Texas Water Development Board SWIFT funds. San Marcos’ share of the BAN is $16,495,600. ARWA now anticipates receiving those SWIFT funds in December 2024, which will be used to pay off the BAN in accordance with Council’s prior approval. The total debt issuance for the Phase 1A/1B project is $119,910,600.
Additionally, the 2024 SWIFT funding will cover the anticipated costs of the ARWA Phase 1 1C/1D expansion to be completed in 2027. This expansion will double the San Marcos allocation from ARWA to 4.8 million gallons per day. San Marcos’ share in the project, which fully completes all Phase 1, is approximately $33,000,000.
The total requested San Marcos funding to pay the BAN debt for Phase 1A/1B completion and to construct Phase 1C/1D of San Marcos’ share is $49,485,000. ARWA Board has approved the 2024 SWIFT funding, the BAN refinancing, and the 1C/1D expansion, including Board members Jane Hughson, Mark Gleason, Tyler Hjorth, Paul Kite, and Marcus Naiser who represent the City. The other ARWA members are scheduled to approve their resolutions Oct 14-21, and the ARWA will approve on October 30th.
The current 1C/1D expansion is slightly ahead of the original projected dates but meets San Marcos Master Planning for water supply needs as previously presented, and the costs will be offset through water sales to neighboring utilities County Line SUD and the City of Kyle, until such time as San Marcos needs the 1C/1D water supply.
Council Committee, Board/Commission Action:
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Alternatives:
None.
Recommendation:
Staff recommends approval.