By Mark Carlisle

Independent Newsmedia

Glendale City Council earlier this month created a committee to review whether the city needs to ask voters for authority to sell more bonds to fund capital projects.

The general obligation or bonds would be paid back with the city’s share of property taxes, but Council is determined not to raise the city’s property tax levy.

If the bond committee and City Council decide to put bond authorization on the ballot, it would be for the Aug. 4, 2020, primary election. Committee members will be selected by Council next month and will meet November through March. If the issue goes to the ballot, the city must notify the county by April.

Glendale last had a bond election in 2007.

City of Glendale workers do road construction along 51st Avenue. Glendale is considering holding a bond election in August 2020 to ask voters for authorization to take out more bonds for capital projects. City staff has identified four areas — parks, flood control, landfill and government facilities — where Glendale will need more bond authorization to complete projects identified by City Council as priorities.

These areas were identified during meetings planning Glendale’s 10-year Capital Improvement Plan where Council planned and prioritized projects that could be funded using general obligation bonds.

Vicki Rios

“The idea here is to give you a sense of which bond funds we already, based on this plan, know we need authority for,” said Assistant City Manager Vicki Rios.

Glendale has only sold about $205 million in bonds for about $305 million in existing bond capacity. However, bond authorization is categorized by type and they city is unable to use unused bond authority in one area for needed bond authority in another area.

“According to state law, we cannot take away or lower authority that was already granted by the voters,” Ms. Rios said.

Instead, the city would need to be granted additional bond authority in the areas of need — parks, flood control, landfill and government facilities — and keep the unused bond capacity in other areas unused.

The challenge would be pitching the idea to voters, as the ballot language is required to mention a property tax rate higher than what Council plans to levy.

“When the ballot language does come out you have to make certain disclosures about what property tax rates would look like if you issued all of the bonds outstanding. So, it’s a little tricky,” Ms. Rios said. “As part of what the bond committee to look at is the messaging out to the public of this information.”

In other words, the ballot would show the property tax rate that would result from Council using its entire bond capacity when Council instead plans to limit itself to selling bonds at a rate where the tax levy would remain flat. This plan is a long-running Council policy and is not written into law.

Parks accounts for nearly three-quarters of Glendale’s need for bond authorization. According to staff’s report, Glendale is $40.8 million short in bond authorization for parks capital projects planned by City Council. Flood control is $7.4 million short, the landfill is $4.2 million short and government facilities are $3.2 million short.

Joyce Clark

Council members said they wanted to give their input to the committee on which projects should be considered for bond funding early in the process. Vice Mayor Joyce Clark, who represents the Yucca District, said the 10-year project list staff presented to Council earlier this month was incomplete.

“This is what the CIP looks like now over the next 10 years. But there are things that are missing from here that at some point Council is going to have to deal with,” Ms. Clark said. “…I don’t think this would stand up over 10 years.”

Glendale will be able to sell more bonds because its general obligation debt service obligations will soon shrink significantly. In the current fiscal year, Glendale will pay just over $20 million in general obligation debt service. In fiscal year 2023, that obligation drops to about $7 million.

City of Glendale workers do road construction along 51st Avenue. Glendale is considering holding a bond election in August 2020 to ask voters for authorization to take out more bonds for capital projects. The plan, should Council send bond authorization to the ballot, would be to sell more bonds under the expanded bond authorization to return that yearly debt service payment to about $20 million. This way Glendale would have funding for prioritized projects but keep the city’s property tax levy flat.

The $4.2 million in additional bond authorization staff has projected for the landfill would not affect the general obligation debt service. Though the bond authorization would be under general obligation, they would be paid back using the city’s landfill fund. Glendale would issue these bonds under general obligation to utilize the city’s good bond rating to have a lower cost of borrowing, said Lisette Camacho, Glendale’s interim director of Budget and Finance.

The bond committee will have seven members representing each of Glendale’s six districts plus one at-large member. Each council member will select a member from his or her district and the mayor will each select the at-large member.

The committee will make a recommendation on whether to have a bond election, how much bond authorization to ask for and in which categories, how to form ballot language and how to message the ballot measure to voters. Council will have the final decision on each of these aspects.

If Council decides to hold a ballot election, which it must announce by April 2020, April through August would be a public outreach campaign for the city.

Glendale Independent News Editor Mark Carlisle can be reached at mcarlisle@newszap.com or found on Twitter @mwcarlisle.