Denison council approves publication of notice to issue certificates of obligation for water system improvements

The Denison City Council on Oct. 20 unanimously approved a resolution directing publication of a notice of intent to issue combination tax and revenue certificates of obligation to finance water system improvements.

City staff member Miss Acevedo told the council the principal amount would not exceed $5,085,000 and that the issuance is tied to funding through the Texas Water Development Board. "The purpose of this grant is to mitigate water loss," Acevedo said, and she said the city qualifies because of a high level of water loss for a community its size, attributed primarily to aging infrastructure.

The staff presentation said the city previously approved a similar issuance earlier in the year that provided $5,100,000 in grant funding. Acevedo said the series before the council "will bring us an 11,000,000, $865,000 in grant funding," as stated at the meeting. The resolution on the dais was a shortened version prepared by bond counsel that omitted current outstanding general debt obligations, Acevedo said.

City staff member Miss Salsabaugh answered questions from council members about timing and financing. She said the notice will be published on the city website later in the week and in the newspaper on Saturday, Oct. 25 and again on Nov. 1. The ordinance to authorize the issuance is scheduled for council consideration on Dec. 15, with closing and funding scheduled for Jan. 6.

Salsabaugh also told the council the financing will be structured for a 30-year term and that the city will be able to defer principal payments for the first couple of years, paying interest initially and easing into principal payments over the 30-year term. When asked whether participation in the TWDB program produced a more favorable interest rate, Salsabaugh said it does and that "it usually this 1 will run between 23%, the overall interest cost. That's what they're estimating. It usually comes in lower than what they estimate." The transcript record contains that phrasing; the council did not provide a different figure at the meeting.

Councilman Massey moved to adopt the resolution directing publication of the notice; Councilman Thorne seconded. The mayor called for the vote, and the motion carried unanimously. The council did not record individual roll-call votes in the meeting transcript.

The funding and schedule language discussed at the meeting indicate the city intends to proceed to publish notice and return on Dec. 15 for final authorization, with closing projected for Jan. 6. Additional details about the project list, specific grant award amounts, and final interest rates will be set as bond counsel and the Texas Water Development Board finalize terms.

Votes at a glance: - Motion to adopt resolution directing publication of notice of intent to issue combination tax and revenue certificates of obligation (Series 2026): Moved by Councilman Massey; seconded by Councilman Thorne; outcome: approved (motion recorded as unanimous; individual roll-call not recorded in transcript).