Queen Creek council approves emergency measure to sell remaining bonds for parks
Independent Newsmedia
Posted 6/7/22
At its Wednesday, June 1, meeting, on a vote of four to two, the Queen Creek town Council agreed to keep the property tax levy at a $1.83 rate for every $100 of a home’s assessed …
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The Queen Creek Town Council voted to authorize the sale of the balance of a debt issue to fund park construction and expansion under fiscal terms that benefit the town.
In April, the town council approved authorizing a $138 million debt issue to fund Phase 1 of the Parks Master Plan. The funds are set to pay for:
New land acquisition (Jorde Property) - $23 million
Frontier Family Park (Formerly East Park) - $40 million
Mansel Carter Oasis Park expansion - $10 million
Recreation center at Frontier Family Park - $40 million
Aquatics center at Frontier Family Park - $25 million
However, market rates have been volatile this year. As a result, the town was only able to sell $113 million of the $138 million authorized amount within the interest rate parameters originally approved by the town council.
The town now will issue $25 million in supplemental debt at the lowest interest rates available. The authority to finalize the specifics of the debt issue has been given to the town manager and/or the finance director/chief financial officer.
To best address the increasing interest rate environment, town staff recommended an emergency clause as a part of approval of the resolution. This allows staff to lock in a favorable interest rate and not have to wait for the standard 30-day period.
The emergency provision required six supporting voted from town council. The vote was unanimous, with Mayor Gail Barney attending remotely in order to vote.
Council Member Emilena Turly said while she did not support the initial bond issuance, she recognized the importance of securing more favorable interest rates for the town.
Agreeing to the new parameters could save the town thousands of dollars:
With Emergency Clause
Not to Exceed Amount - $25 million
Not To Exceed Rate - 3.75%
Annual Payment - $1.93 million
Without Emergency Clause
Not to Exceed Amount - $25 million
Not To Exceed Rate - 4.75%
Annual Payment - $2.16 million
Town staff expects to share the sale results during the July 20, town council meeting. Besides staff, officials will be working with the town’s financial adviser, Wedbush Securities.
“Their responsibility is to advise the town on all matters related to issuing debt including timing, market conditions, financing structures, and managing the Underwriters,” according to a staff report. “Wedbush Securities has been working for the Town since September 2018.”
