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Willacy County court approves publication of notice to pursue certificates of obligation for courthouse renovation
Summary
Willacy County Commissioners Court voted June 25 to publish notice of intent to issue certificates of obligation (not-to-exceed $15 million) to help fund a planned renovation of the historic county courthouse; advisers said the project also relies on roughly $9 million in Texas Historical Commission grant funding and that final borrowing will be set after construction bids are received.
The Willacy County Commissioners Court on June 25 approved a resolution authorizing publication of a notice of intent to issue certificates of obligation, a step toward financing a multi-year renovation of the county courthouse.
Financial adviser Don Gonzalez told the court that certificates of obligation allow counties to issue debt without a voter election and would be repaid from a pledged portion of property taxes. “Certificates of obligation are intended to be able to allow counties to issue debt without having to go to the voters,” Gonzalez said.
The court was presented with an illustrative financing plan that combined a Texas Historical Commission grant commitment of approximately $9 million with a not-to-exceed certificates of obligation amount of $15 million. The finance team said the combined illustrative sources and uses approach showed roughly $24 million of available funds in the plan, including estimated issuance costs of about $250,000 and an estimated bond-insurance cost of about $300,000. Advisers cautioned that exact figures will change after construction bids are received.
Presenters used conservative assumptions — a 6% interest rate and a 20-year term — to model potential tax-rate impact and annual debt service. The finance team estimated annual debt service in the $1.1 million–$1.2 million range if the full $15 million were issued; the presenters emphasized the amounts are illustrative and will be refined when bids and the final par amount are known.
Commissioners and advisers discussed schedule risks and the need to get construction bid packages out quickly so bid prices can be matched to available grant and financing proceeds. The finance team outlined a preliminary timetable that would publish the notice in early July (two consecutive newspaper publications), receive bids by late July, post an offering Aug. 19, price bonds Aug. 26, seek final approval Aug. 27 and close Sept. 24 so debt service could be included in next year’s budget.
County Judge Cordova praised the effort to secure grant funding and pressed for timely bids so the county can lock in pricing. On a motion by Commissioner Gier, seconded and carried by voice vote, the court approved the resolution authorizing publication of the notice of intent to issue certificates of obligation and directed staff to publish and post the notice as required.
The court’s action begins the statutory notice process; the final amount the county will borrow will be set later, after construction bids and underwriting are complete.
