Cave Creek weighs revenue bonds, voter bonds and federal LWCF grants to fund proposed land purchase

Cave Creek officials and outside advisers laid out financing scenarios on the same meeting day the Town Council authorized staff to file an application with the Arizona State Land Department.

Advisers from Stifel used a working acquisition assumption of about $14.5 million (subject to the ASLD appraisal) and showed two primary paths: revenue bonds (issued against town excise/TPT receipts, no voter election required) and general obligation (G.O.) bonds that require voter approval. Stifel projected a revenue-bond issuance of roughly $10.4 million after current equity, producing illustrative annual debt-service figures of roughly $800,000 on a 20‑year schedule at 4.4% interest and a somewhat lower annual burden on a 25‑year structure. After applying the town’s approximately $500,000 annual open-space tax revenue, Stifel estimated the net budget impact could be in the range of $200,000–$300,000 per year under those scenarios.

Stifel’s advisers also illustrated voter-bond (G.O.) scenarios that would spread costs differently and could result in lower borrowing rates but require an election and related costs. In a G.O. example, the advisers showed a hypothetical average taxpayer impact of about $157 per year based on a 27‑cent average levy used for statutory voter‑pamphlet estimates; in a smaller cash‑use scenario that used $6.2 million of local cash the same adviser produced a lower estimated impact near $64 per year.

CFO Sher White and advisers recommended the revenue-bond approach as the lowest near‑term household impact and because it avoids the additional cost and scheduling constraints of a voter election. The council voted to direct staff to pursue a revenue-bond path as the preferred funding option to accompany the ASLD application.

Grant opportunities: Consultant R.J. Carden highlighted the Land and Water Conservation Fund (LWCF), noting that the fund is supported by offshore-drilling lease revenues and was strengthened by the Great American Outdoors Act. He said Arizona State Parks has recently had $6–9 million available annually and told councilors the state program increased the per-application maximum to roughly $2 million. Carden emphasized two important tradeoffs: (1) LWCF requires a one‑to‑one cash match and (2) LWCF-funded parcels must remain open to the public in perpetuity — constraints that staff said are consistent with Cave Creek’s conservation goals.

Partnerships and match strategies: Staff noted the town could partner with Maricopa County (an intergovernmental agreement) or pursue multiple LWCF applications across years to layer funding. Public commenters suggested citizen initiative options and private fundraising as additional matches.

What remains: All numbers presented by advisers were illustrative pending a formal ASLD appraisal and the auction outcome. Council’s direction allows staff to refine financing terms, pursue grants and present formal debt-issuance documents or an election plan to the council if required.