Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
Lucas Council authorizes $1.1M tax note, selects Simmons Bank at 3.6% to fund roadway and drainage projects
Summary
The council approved an ordinance authorizing issuance of tax notes (series 2026) to finance capital projects — notably Stinson Road drainage and bridge work — selecting Simmons Bank as purchaser at an all-in rate reported as 3.6%. A reimbursement resolution to capture qualifying prior expenditures was also adopted.
Council considered Ordinance No. 2026-06-01047 authorizing the issuance of City of Lucas tax notes, series 2026, and related financing actions.
Why it matters: The city authorized $1.1 million in short-term tax notes to finance primarily capital roadway and drainage improvements, including a targeted Stinson Road drainage and bridge project. The financing mechanism and selected bidder affect debt service costs.
Bids, term and adviser overview City staff reported three bids were received and the low bid (Simmons Bank) produced the lowest true interest cost. City Manager (speaker 2) and financial adviser Mark McLaney (speaker 11) explained that while tax anticipation notes are often short-term, state law allows tax notes up to seven years; the packet reflected maturities across 2027–2031. McLaney said the city's AA+ rating helped produce a competitive result and that avoiding bond issuance and rating costs reduced the all-in borrowing cost.
"We came in at 3.60," Mark McLaney said, describing the low bid and noting that eliminating bond-rating costs can shave roughly 50 basis points from issuance expenses.
Use of proceeds and tax impact City staff said the note proceeds are available for capital projects such as roadway improvements and specifically for the Stinson Road drainage/bridge project; funds could be redirected to other roadway projects if needed. Staff emphasized the tax note should not change the city's ad valorem tax rate; any tax impact would result only from changes in property valuation rather than from adopting the note.
Motion and reimbursement resolution Councilor (speaker 8) moved to approve the ordinance and to select Simmons Bank to complete the process at an interest rate of 3.6%; the motion was seconded and passed unanimously. Council then adopted Resolution R‑2026‑06‑00582 establishing the city's intent to reimburse prior qualifying expenditures from tax-exempt proceeds — staff said there are no identified reimbursements at this time, but the resolution preserves the option to capture qualifying costs incurred up to 90 days before issuance.
Outcome and next steps The ordinance and reimbursement resolution passed unanimously. Staff will finalize the ordinance text to include the finalized rates and payment schedule and proceed with closing with Simmons Bank.
