At its Dec. 8 meeting the City of Josephine approved two reimbursement agreements tied to public improvement districts that underpin upcoming bond financings for local housing developments.

Legal and financial counsel explained the agreements — one associated with Josephine Public Improvement District No.1 (marketed as Morningside and being developed by Brightland Homes) and the other connected to Morgan Farms (Meritage Homes of Texas LLC) — reimburse developers for infrastructure once assessments or PID bonds are issued. Rudy Segura of McCall Parkhurst described the agreements as a ‘‘reimbursement’’ mechanism: the developer funds construction up front and is repaid later from assessments or bond proceeds. He told council the agreements are non‑recourse to the city and are structured so that, if assessments are levied, they secure repayment from property owners rather than the city.

Councilmembers asked detailed questions about risk, bond sizing, developer contributions and collection mechanics. Staff said developers previously contributed amounts to city infrastructure — staff referenced $4,000 per lot for sewer and an additional $2,300 per lot for water for one of the projects — and that those funds have been received. Advisors said underwriter appraisals and bond caps will determine final bond amounts and that PID administrators typically collect assessments via the property tax bill; liens are filed and foreclosure processes exist for nonpayment.

After the presentations council moved to approve the two reimbursement agreements and authorized the mayor to execute the documents on the city’s behalf, enabling the developers to file final plats and proceed toward reimbursement bond issuances, likely in early 2026.

Why it matters: These agreements facilitate the transfer of public infrastructure from private developers to the city while providing a repayment mechanism (assessments or PID bonds) that developers and underwriters use to finance eligible public improvements. Council was told the arrangements are intended to put new housing and associated tax base on a path toward construction without obligating existing city taxpayers to repay developer bonds.

Next steps: Staff and the developer teams will finalize bond sizing with underwriters and independent appraisers, complete PID administrative steps, and present bond issuance and assessment levies for council approval in later proceedings.