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Introduction of Bond Orders for Two-Thirds Bonds and Call for a Public Hearing for the Issuance of Two-Thirds Bonds.
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Staff:
Department:
Amy Oland, Director
Business Management Department
Overview: The Town is pursuing the issuance of "two-thirds" bonds to fund public safety equipment. The two-thirds bonds would be sold on February 14, 2022 in conjunction with the final issuance of the 2018 referendum general obligation bonds for affordable housing and the final issuance of the 2015 referendum general obligation bonds for streets and sidewalks.
Recommendation(s):
That the Council take the following actions concerning the issuance of $1.98 million of two-thirds bonds.
1. Formally introduce the Bond Order describing the use of the bonds.
2. Adopt the resolution setting the public hearing for January 11, 2022 and authorizing the filing of a sworn statement of debt.
Key Issues:
Two-Thirds Bonds Background
* Under the Local Government Bond Act, the "two-thirds rule" authorizes local governments to issue general obligation bonds without a referendum under certain circumstances.
* Two-thirds bonds are restricted to two thirds of the net reduction in general obligation bond principal for the previous fiscal year. The Town's reduction in principal for FY 2022 was $2,977,000. Two thirds of which is approximately $1,984,667. Two-thirds bonds must be issued in the fiscal year immediately following the year for which the principal reduction is calculated.
* Two-thirds bonds are also restricted to certain uses including streets, parks, public facilities, and public safety. All other allowable purposes are listed under Section 159-48 of NC General Statute, Chapter 159, Article 4 (the Local Government Bond Act).
Two-Thirds Bonds Recommended Use
* The availability of two-thirds bonds and the current cost of borrowing provide an opportunity to fund the replacement of the Town's public safety radio equipment.
* Effective, July 1, 2025, all radios activ...
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