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Kaufman County reviews bond sale plan for juvenile detention center; officials project minimal tax impact
Summary
County financial adviser outlined timetable for bond issuance, rating calls and potential tax effect; commissioners discussed underwriting plan and delegated pricing authority if market moves.
Kaufman County Commissioners Court on July (date not specified) reviewed plans to issue bonds to finance a new juvenile detention center, with the county's financial adviser outlining a timetable for rating calls, marketing and pricing.
The plan, presented by George Willeford of Hilltop Securities, includes calls with two rating agencies next week, posting a preliminary official statement for investors on Aug. 4, formal consideration at the court's regular meeting on Aug. 12 and anticipated settlement in early September. Willeford said the county will seek a credit rating that will guide interest rates and investor demand.
Willeford told the court the preliminary official statement was finished on June 30 and sent to rating agencies. “We finished that and ... sent it to the rating agencies,” he said. He described a plan to price the bonds in August and, if markets force a delay, to use delegated authority to allow the judge and auditor to approve final pricing so the sale can proceed without waiting for a subsequent regular meeting.
Willeford gave an estimated fiscal effect of the debt service on the tax rate, saying the amount presented in the materials would represent about "0.0081 pennies, or eight‑tenths of a cent" on the tax rate. He said that, under the county's model and using an average home value cited in the packet (a little over $310,000), the impact would be about $25 a year, roughly $2 a month.
Court members asked about underwriter selection; Willeford said he recommended a syndicate of three or four firms with a designated senior manager to lead the sale and that the county's team (the judge and county finance staff) had met several prospective underwriters. He said proceeds would likely be received by the county in early September, roughly a month after pricing.
The presentation was informational; the court did not vote to issue the bonds at this meeting. Willeford said the court's next formal authorization under state law would be scheduled for the Aug. 12 regular meeting, when at least four of five commissioners must be present to authorize debt issuance.
Next steps: rating calls with agencies next week, posting the preliminary official statement to investors on Aug. 4, formal consideration at the Aug. 12 meeting and anticipated settlement in early September if the market pricing proceeds as planned.
