From
Diana G. Ortiz, Chief Financial Officer
Title
Resolution approving the proposed City of Grand Prairie Debt Management Policy to become effective upon passage and approval
Presenter
Diana G. Ortiz
Recommended Action
Approve
Analysis
The City's Debt Management Policy is reviewed each year for necessary revisions, operational procedures, staffing changes and/or new state/federal laws. Staff recommends the following changes to the policy:
1. Update job titles from Cash & Debt Manager to Treasurer and Cash and Debt Analyst to Treasury Analyst, respectively, throughout the policy. The revised titles are consistent with the City's payplans and job descriptions;
2. Section IV. Long-Term Debt, A. General: Delete third sentence "The City will strive...of small issuer.."; B. Certificates of Obligation: Delete "...which is usually three years." (This is in paragraph one, last sentence.) This structure is outdated with the life of the assets specifically for heavy equipment used in operations such as by Landfill, Public Works, Fire and other departments.
3. Section VI. Capital Leasing; Delete first sentence stating "Capital leasing is an option for the acquisition of a piece or package of equipment costing less than $500,000." This operational funding level restricts the City's financial considerations by several departments' goals and objectives, such as in Landfill, Public Works, Fire, etc.
4. Section IX. Official Statement, B. Timing: Replace this information with "The Finance Department will compile and review all supporting documents and required schedules in accordance with a timeline provided by the City's financial advisor in advance of each desired bond sale. Timelines are prepared approximately two to three months prior to each debt issue, depending on the complexity of each project."
"In addition, the Finance Department will review and approve the preliminary and final official statements prior to their distribution."
5. Section XII. Secondary Market Disclosure; Due to the broad, sweeping changes from the Federal and State level governments, the entire section text is replaced with "The City shall comply in accordance with all disclosure regulations introduced, updated and effective on the date of the city's debt issuance. Furthermore, the City's existing, outstanding debt issues will comply with all new continuing disclosure regulations executed."
6. Section XIII. Arbitrage Liability Management , D. Two-Year Spend-out Option: Add to the end of the last sentence "and will comply with all Federal and State law changes and be managed by the Finance Department."
Financial Consideration
There is no financial impact resulting from this action.
Body
A RESOLUTION OF THE CITY OF GRAND PRAIRIE, TEXAS, APPROVING THE PROPOSED CITY OF GRAND PRAIRIE DEBT MANAGEMENT POLICY TO BECOME EFFECTIVE UPON PASSAGE AND APPROVAL
Whereas, it is the goal of the City to maintain a long-term, stable and positive financial condition; and,
Whereas, well-planned and prudent public funds' debt management is essential to the achievement of the City's goals; and,
Whereas, the City is required to review, revise if necessary and adopt the City's Debt Management Policy annually.
NOW THEREFORE, BE IT RESOLVED, by the City Council of the City of GRAND PRAIRIE, Texas that:
Section 1. The proposed debt management policy is updated with the following revised sections:
a. Section IV. Long-Term Debt, A. General; Delete language that refers to small government issuers that typically sell less than $10 million each year, and, B. Certificates of Obligation: Delete "...which is usually three years."
b. Section VI. Capital Leasing: Delete sentence "Capital leasing is an option for the acquisition of a piece or package of equipment costing less than $500,000."
c. Section IX. Official Statement, B. Timing: Replace section text with "The Finance Department will compile and review all supporting documents and required schedules in accordance with a timeline provided by the City's financial advisor in advance of each desired bond sale. Timelines are prepared approximately two to three months prior to each debt issue, depending on the complexity of each project. In addition, the Finance Department will review and approve the preliminary and final official statements prior to their distribution."
d. Section XII. Secondary Market Disclosure: Replace entire section text with "The City shall comply in accordance with all disclosure regulations introduced, updated, and effective on the date of the City's debt issuance. Furthermore, the City's existing, outstanding debt issues will comply with all new continuing disclosure regulations executed."
e. Section XIII. Arbitrage Liability Management, D. Two Year Spend-out Option: Add to the end of the last sentence "...and will comply with all Federal and State law changes and be managed by the Finance Department."
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAND PRAIRIE, TEXAS, JANUARY 10, 2017.