12 - Notice of Intention to Issue Certificates of Obligation to Fund Improvements to Love Civic Center

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Item No. 12 TO: Mayor & City Council FROM: Gene Anderson, Interim City Manager & Finance Director SUBJECT: NOTICE OF INTENTION TO ISSUE CERTIFICATES OF OBLIGATION TO FUND IMPROVEMENTS TO LOVE CIVIC CENTER DATE: November 6, 2019 BACKGROUND: In January 2019 the Council passed a resolution designating the renovation of Love Civic Center as a venue project under Chapter 334 of the Texas Local Government Code, and called for an election to approve an additional hotel occupancy tax not to exceed 2% to finance the venue project. The election was held on May 4, 2019 with voters approving the increased hotel tax rate. The increased rate went into effect July 1St. The City waited until the next quarter's hotel taxes were paid to verify that the 2% increase would be sufficient to make the debt payments on $1,500,000 in certificates of obligation issued by the City to finance the improvements to the civic center. Revenues were sufficient to make such payments. STATUS OF ISSUE: The Council is requested to approve a resolution requiring notice to be published in the newspaper and on the City's website indicating that the City intends to issue certificates of obligation to fund the civic center improvements. BUDGET: The City will set up an Interest & Sinking Fund in which to deposit the 2% hotel tax collections that will be used to make principal and interest payments on the certificates of obligation. This debt will show up in the City's budget each year until the debt is paid. RECOMMENDATION: Move to adopt a resolution directing newspaper publication and posting on the City's website of a notice of intention to issue certificates of obligation.