Zions Public Finance outlines bond, loan and tax options as Alta weighs financing for new facilities

Alta Town Council heard a public‑finance briefing from Zions Public Finance during a strategic planning retreat aimed at aligning design and funding decisions for a proposed new facilities program.

Mark Anderson and Jeanette Harris of Zions Public Finance outlined the principal financing choices available to municipal issuers: pay‑as‑you‑go, grants or donations, state revolving loan funds, general obligation (G.O.) bonds, utility revenue bonds, lease/lease‑revenue financings, special assessments, tax‑increment financing and private placements. Both advisers stressed there is no one‑size‑fits‑all answer and recommended matching the revenue pledge to the asset being financed.

Why it matters: the town is contemplating capital projects that staff estimated collectively in the low‑multimillion‑dollar range. Zions emphasized that borrowing can accelerate construction at current market rates but obligates the issuing municipality to long‑term debt service, and that the chosen pledge (property tax, sales/excise tax, utility fees, etc.) strongly influences interest rates, market reception and voter involvement.

Key points from the briefing and council discussion

- Types of financing: Mark Anderson described G.O. bonds as the lowest‑cost option in the public market because of the strong pledge of the property taxpayer. Utility revenue bonds and sales/excise bonds are tied to specific revenue streams (for example water/sewer fees or sales tax) and typically require higher coverage ratios. Lease‑revenue structures can be used to avoid a ballot election but are subject to annual appropriation and usually carry higher rates than a G.O. bond.

- State revolving loans and private placements: Jeanette Harris noted that state revolving funds (for water and sewer projects) offer low interest rates but are administratively slower; she estimated the state process often takes 6–12 months depending on application completeness. Private placements or direct bank purchases can be arranged more quickly and may suit smaller, simpler financings.

- Election and timing constraints: Zions explained a G.O. bond generally requires a voter proposition. To be on a November ballot the council would need to adopt an election resolution and follow statutory posting and public‑hearing timelines (staff noted a practical deadline in August to get on the November ballot). The advisers also described how a market issuance (public sale) can be completed in roughly 90 days if the town is prepared and has documentation in order; state loans commonly take longer.

- Local revenue context: Chris presented a high‑level fiscal snapshot: general fund revenues roughly $3.1 million with about 56% from sales tax and about 15% from property tax (planning year referenced). The town’s capital outlook included water/sewer replacement projects and a notional planning figure for a new facility; the broad capital list summed to a figure staff listed at roughly $10.6 million.

- Transient room tax and other revenue levers: Councilors discussed the local option transient room tax (TRT) as a near‑term mechanism to generate additional revenue for capital; presenters noted that any excise or sales tax pledge is a resolution‑level financing option and would carry coverage requirements. Staff and councilors also discussed potential rate increases for water and sewer projects and the tradeoffs of lengthening timelines to reduce annual rate impacts.

What councilors asked and Zions responded

- Who pays and who votes: Council members were concerned that many Alta property owners are second‑home owners or non‑resident voters; the advisers said a G.O. bond vote is decided by registered voters in the jurisdiction and encouraged robust outreach and education. Mark Anderson emphasized best practices for ballot success: unified council support, clear demonstration of need, a reasonable solution and credible cost estimates.

- Borrow only for the building or include water/sewer: The advisers recommended evaluating financing for each asset class against an appropriate pledge (e.g., utility revenue bonds for water/sewer). They said combining different project types in one issuance is possible but increases structuring complexity and requires careful rating and covenant considerations.

- Timing and next steps: Zions recommended the town secure a municipal‑adviser relationship before structuring a public offering. Council directed staff to refine the preferred facilities concept to a design level sufficient to establish a credible budget (staff suggested 10% then 30%) and to return with a financing recommendation once the scope and budget were firm.

Quotes

"Debt financing does the best job of matching the people who use the project and the people who pay for projects," Mark Anderson said, explaining the logic behind borrowing to accelerate construction.

Ending

Zions Public Finance provided a road map of financing choices and procedural timelines; councilors asked staff to continue design and permitting work, to scope the likely borrowing need and to engage a municipal adviser so the town can compare market issuance, state loan and private‑placement options before any final decision on a ballot or financing structure.