Decatur approves Libertas development agreement, levies PID assessments and sells bonds for Nature Creek Reserve

The City of Decatur on Monday approved a development agreement with Libertas Decatur LP related to the Nature Creek Reserve project and adopted assessment ordinances and bond issuances to finance public improvements for the associated Paloma/Loma Trails public improvement districts.

Council took the actions after an executive session under Texas Government Code Section 551.087 for economic-development negotiations with Libertas Decatur LP and public hearings on two PID assessment ordinances. The city then approved ordinances to levy assessments, authorized bond documents and approved a development agreement that adjusts several financing terms requested by the developer.

The development agreement, described in the council packet and discussed in open session, increases the previously proposed PID authorization from $30 million to $32 million. The agreement sets a minimum “tax equivalent assessment rate” of $1.00 per $100 of assessed value per parcel (unless requested in writing by the developer), with a cap of $1.20 per $100 of assessed value. The agreement also includes value-to-lien protections: the city will not levy assessments on a parcel if the overall value-to-lien ratio would be less than 1.5:1 using an independent appraisal, and bonds will not be issued with a value-to-lien of less than 2.0:1 unless otherwise agreed to by the city.

City financial advisers and bond counsel described the municipal market pricing used when the bonds were sold on the open market earlier that day. The city’s financial adviser reported that the sale was oversubscribed and that pricing produced interest-cost results slightly lower than preliminary estimates, reducing expected borrow­ing costs.

Council voted to adopt the two assessment ordinances (for the improvement-area and the major improvement-area assessment rules) and then approved ordinances to authorize the sale of special-assessment revenue bonds that will be secured by those assessments. Council also voted to approve the development agreement with Libertas subject to final legal approval as noted in the motion.

Why it matters: the approvals put in place the assessment structure and financing mechanism the developer will use to construct public infrastructure for the Nature Creek Reserve/Paloma Trails project. The value-to-lien protections and the specified tax-equivalent assessment range are city-level safeguards intended to limit fiscal exposure while enabling the private developer to access PID financing.

Council next steps and implementation: bond documents and related developer agreements referenced in the ordinance will be finalized and executed following council approval. City staff and bond counsel will continue to monitor construction progress and assessment roll implementation.

Votes at the meeting: city council approved the assessment ordinances, authorized the bond issuances and approved the development agreement with Libertas Decatur LP. The clerk recorded voice votes; no public objections were recorded during the hearings or the ordinance votes.

Notes: the council conducted a closed executive-session negotiation on the Nature Creek Reserve PID before returning to open session and taking final action.