North Lake Town Council approves $27.5 million in bonds, backs industrial plan changes and several development agreements

North Lake — The North Lake Town Council on Feb. 27 approved a package of financing and development actions including a $22,280,000 general obligation (GO) bond tranche for the Star Center project, $5,225,000 in hotel-occupancy tax revenue bonds for a hotel/conference center, amendments to an industrial plan development for DHL Supply Chain, and two development-agreement actions discussed in executive session. All recorded votes were unanimous among the six councilors present; one council member was absent.

The council approved the GO bond issuance to fund the Star Center project, bringing the total project fund from voter-authorized bond proceeds close to the $45 million authorization. John (staff member) told the council the combined 2024 and 2025 issuances will leave a project balance of about $44,790,000 and that the town expects delivery of the funds on March 27. Marty Hsu of Hilltop Securities, the town’s financial advisor, said the bonds “were oversubscribed” and reported a favorable market result; the taxable GO bonds carried a final true interest cost of about 5.46%.

The council also approved hotel-occupancy tax revenue bonds to finance the town’s planned hotel/conference center. The issuance for that project was presented as $5,225,000 in total bonds with debt service to be paid from hotel-tax revenues. Marty Hsu explained hotel-tax-backed revenue bonds generally carry higher interest rates than GO bonds because they are secured only by hotel revenues; he said the transaction’s TIC was about 5.81% and that the town saved roughly $60,000 over the bond life by purchasing bond insurance.

Separately, the council approved an amendment to the industrial plan development north of the Speedway to align standards for a DHL Supply Chain site with adjacent plan-development standards. Jeff Meyer, representing DHL Supply Chain, told the council the applicant withdrew an earlier request tied to oil-and-gas well setbacks, saying they were “fine with pulling that from the request.” The ordinance approving the amendment included a motion to remove line 3(k) of the development standards before final passage.

On consent, the council approved routine items and authorized the town to schedule a public hearing and notices necessary to create a reinvestment zone that will enable a negotiated tax-abatement package for a Michael Carter development on FM 407 behind a storage facility. Staff explained the step is the formal public-notice phase required to create a reinvestment zone and that the abatement schedule will phase down to full taxable value by year seven.

After a closed session, the council returned and approved amendments to a development agreement for the Northlake Business Park (Gaddy Commercial Venture), which include allowing a small portion of the property to disannex now with a requirement that the entire property be annexed into town limits within three years, and provisions to secure access for a potential water-tower site and drainage easements. The council also approved a reimbursement agreement to pay a developer up to $53,000 to oversize and connect a water line that will allow system improvements in the northern pressure plane.

Votes at a glance - Consent items (minutes; Atmos agreement participation; other consent items a and c): Approved, motion carried 6–0 (1 absent). - Consent item B — call public hearing/notice to create reinvestment zone for Michael Carter development (tax-abatement enabling step): Approved, motion carried 6–0 (1 absent). - Industrial plan-development amendment (DHL Supply Chain site): Approved with removal of line 3(k) from standards, motion carried 6–0. - Ordinance authorizing issuance and sale of Town of North Lake general obligation bonds, taxable series 2025, principal amount $22,280,000: Approved, motion carried 6–0. - Ordinance authorizing issuance and sale of Town of North Lake hotel-occupancy tax revenue bonds, taxable series 2025, principal amount $5,225,000: Approved, motion carried 6–0. - Amendment to development agreement with Gaddy Commercial Venture (Northlake Business Park / Florence Road): Approved, motion carried 6–0. Key points: allow disannexation of a small portion now; require full-property annexation within three years; include access for a potential water tower and drainage easement. - Reimbursement agreement to developer for oversizing/looping a waterline (northern pressure plane): Approved, not to exceed $53,000, motion carried 6–0.

Why it matters The bond approvals free roughly $44.8 million for the Star Center and related projects and authorize hotel-tax-backed debt for the conference/hotel project; together those actions commit the town to multi-year debt-service schedules and link repayment to property-tax capacity and hotel tax receipts. The industrial-plan amendment and the development-agreement changes clear regulatory and infrastructure items needed for upcoming private construction in the town’s industrial district; the waterline reimbursement and water-tower access are intended to support the town’s planned system configuration and future growth.

What council members said John (staff member) summarized the bond math and schedule and told the council the 2025 delivery is expected March 27. Marty Hsu, the town’s financial advisor with Hilltop Securities, said the market response was positive: “The bonds were oversubscribed,” and he noted both S&P Global and Fitch affirmed the town’s strong ratings on its GO debt. Jeff Meyer, representing DHL Supply Chain, said the applicant withdrew its oil-and-gas-well setback request and was “happy to answer any other questions.” Resident Joel McGregor used public comment to criticize local tax incentives and spending, saying the subsidy structure could shift costs to long-term residents.

What’s next If there are no legal or closing delays, staff said the bond funds should be delivered on or about March 27. The development agreement for the Northlake Business Park includes a three-year annexation requirement; the town will also proceed with the public hearing and notice steps required to create the reinvestment zone for the Michael Carter development.

Ending Council members emphasized the importance of maintaining the town’s credit and careful tracking of restricted funds such as the hotel-occupancy tax. All motions shown in the minutes carried unanimously among the six council members present; one councilor was recorded as absent.