DEBT MANAGEMENT PLAN FINANCE DEPARTMENT
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D EBT MANAGEMENT PLAN Presented by Troy Elliott , Finance Director August 24, 2021 FINANCE DEPARTMENT
Transcript of DEBT MANAGEMENT PLAN FINANCE DEPARTMENT
PowerPoint PresentationFINANCE DEPARTMENT
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Property Tax Debt 1,2,3 $2,276.3M 2.07% 8.2 PFC Lease Revenue Bonds – Convention Center Expansion 4 538.6M 3.98% 14.7 Airport - GARB 149.1M 3.34% 9.0 Airport – PFC 100.1M 2.66% 7.3 Airport – CFC 121.1M 5.75% 15.5 Stormwater 44.4M 1.25% 4.4 Contract Revenue Bonds – Starbright (Toyota) 15.2M 4.32% 7.0 Municipal Facilities Corporation (MFC)
MFC Lease Revenue Bonds - Fire and Police Dispatch Center (PSAP) 22.4M 5.09% 12.0 MFC Contract Revenue Notes – Brooks 2 5.4M 2.40% 7.3 MFC Fixed Rate Revenue Bonds – City Tower 59.8M 2.55% 18.2 MFC Variable Rate Revenue Bonds – City Tower 30.6M 2.47% 28.5
Total 5 $3,363M 1 Includes general obligation bonds, certificates of obligation, tax notes and public property finance contractual obligations. 2 Includes private placement debt. 3 Includes self-supporting debt in the amount of $315.2 Million including $62 Million in Interim Financing Notes for the Airport. 4 Includes Capital Appreciation Bonds with proceeds in the amount of $30.0 Million and a maturity value of $99.5 Million. 5 Does not include Bonds in the amount $168.3 Million related to the Convention Center Hotel scheduled to be paid from revenue generated from Hotel Operations.
Outstanding Effective Average Principal Interest Rate Life (Years)
Bond Ratings
High Grade AA+ Aa1 AA+
AA Aa2 AA
AA- Aa3 AA-
Upper medium grade
A+ A1 A+
A A2 A
A- A3 A-
Lower medium grade
BBB+ Baa1 BBB+
BBB Baa2 BBB
BBB- Baa3 BBB-
Current Bond Ratings
Property Tax Debt AA+ Aaa AAA
PFC Lease Revenue Bonds – Convention Center Expansion AA Aa2 AA+
Airport Revenue Bonds A+ A1 A
Airport - Passenger Facility Charge Bonds A A2 A-
Airport – Customer Facility Charge Revenue Bonds BBB+ A3 BBB+
Stormwater Bonds AA+ Aa2 AA+
Contract Revenue Bonds – Starbright (Toyota) AA Aa1 AA+
MFC Lease Revenue Bonds – Public Safety Emergency Dispatch Center
AA Aa1 AA+
Property Tax – Debt Outstanding
General Obligation Bonds $1,588.3 Million Certificates of Obligation $538.5 Million Tax Notes $140.3 Million Public Property Finance Contractual Obligations $9.1 Million
Effective Interest Rate: 2.07% Average Life: 8.2 years
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Bond Rating: “AA+” / “Aaa” / “AAA” by Fitch, Moody’s, and S&P Moody’s has assigned a Negative Outlook to its Bond Rating
Actual Debt vs. Legal Capacity*
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• State Law and the City Charter provide legal limits for Ad Valorem Debt
Should not exceed 10% of Total AV
– Ceiling: $15.1 Billion
Property Taxes levied for debt must not exceed $1.50 per $100 of AV
– Current Debt Portion of Property Tax Rate is 21 cents for every $100 of AV
[In $Billions]
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$1,998
Corpus Christi
*San Antonio – One of the lowest
_______________ SOURCE: Municipal Advisory Council of Texas as of September 30, 2020.
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$4.5 Billion excluding School Districts
• School District debt totals an additional $4.5 Billion and varies by geographic location
Alamo Heights ISD $95M
East Central ISD 58M
• Assumes no change in Debt Service Tax Rate
• Capacity analyses
• Sensitivity analyses
Debt Management Plan Ad Valorem Actual and Projected Issuances 1
0
200
400
600
800
1,000
1,200
1,400
1,600
$109.7 $140.2 $115.0
$550.0 $592.0 $850.0
General Obligation Certificates of Obligation Tax Notes PPFCO Self Supporting **
* Amount includes Interim financing for Airport 1 Preliminary update
**Self Supporting debt paid from non-property tax revenues
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(In Millions)
Total Debt Issuances $4,545.9
Total Refunded Debt ($1,347.9)
Total Principal Paid ($1,840.4)
Total Cash Defeasance ($4.9)
Recent Financing – FY 2021
Obligation
• May 12, 2021
• Privately placed debt
• Financed the cost of capital expenditures related to City- owned Witte Museum
• True Interest Cost 2.01%
Obligation
• True Interest Cost 2.58%
$229.1 Million General Obligation
• August 10, 2021
• Financed FY 2017 Bond Program and FY 2021 Capital Budget projects
• True Interest Cost 1.88%
Total Assessed Value $156.337 Billion Total Taxable Value $131.873 Billion
Proposed Tax Rates Tax Levy 1
M&O Tax Rate $0.34677 $410,350,992 Debt Service Tax Rate $0.21150 $250,278,959 Total Tax Rate $0.55827 $660,629,951
* Based on Tax Year 2021 Certified Bexar Appraisal District Values as July 24, 2021. 1 Includes impact of TIRZ contributions, delinquencies, and Over Age 65 and Disabled property tax freeze.
FY 2022 Property Tax Summary*
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-5.0%
0.0%
5.0%
10.0%
15.0%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Base -4.1% -1.6% -0.3% 3.0% 4.5% 9.9% 7.9% 5.5% 6.7% 4.0% 3.1% New 1.7% 1.1% 1.3% 1.5% 1.7% 2.9% 2.0% 2.1% 1.8% 1.6% 1.9% TTL -2.4% -0.5% 1.0% 4.5% 6.2% 12.8% 9.9% 7.6% 8.5% 5.6% 5.0%
Actuals – Average: 5.29% Proposed
2022 2.1% 1.6% 3.7%
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Commercial $67.8 Billion
Residential $64.0 Billion
480,803 Total Parcels • Residential 370,569 • Commercial 110,234
235,910 Resident Homesteads • 45% of Resident Homesteads
have Over Age 65 & Disabled Exemptions and have frozen tax bills
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28,412 senior and disabled homeowners pay $0 City Property Taxes
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Council District
Average Homestead
Market Value
Average Homestead
Taxable Value
Homestead Total Proposed
FY 2022 Tax Rate .01% * 1% 2% 3% 4% 5% Value 1 Tax Bill $0.55827 Exemption Exemption Exemption Exemption Exemption Exemption
$100,000 $2,345 $530 $28 $28 $28 $28 $28 $28 $200,000 $5,180 $1,089 $28 $28 $28 $33 $45 $56 $300,000 $8,014 $1,647 $28 $28 $33 $50 $67 $84 $500,000 $13,683 $2,763 $28 $28 $56 $84 $112 $140 $600,000 $16,517 $3,322 $28 $33 $67 $100 $134 $167
Average Homestead Taxable Value $208,908 $5,527 $1,166 $28 $28 $28 $33 $45 $56
Revenue Loss to General Fund $3,777,599 $3,836,743 $4,321,433 $5,390,264 $6,785,083 $8,303,867 Revenue Loss to Debt Service Fund 2,304,012 2,340,085 2,635,704 3,287,599 4,138,320 5,064,648
Total Revenue Loss $6,081,611 $6,176,827 $6,957,136 $8,677,864 $10,923,403 $13,368,515
* The .01% Homestead Exemption results in the statutory minimum of a $5,000 exemption.
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1 Includes market value less the impact of the .01% Homestead Exemption which results in the statutory minimum of a $5,000 exemption.
FY 2022 Tax Rate Impact Estimated Tax Rate Impact to Homeowner
Homestead Total Proposed
FY 2022 Tax Rate Value 1 Tax Bill $0.55827 1/4 Cent 1/2 Cent 3/4 Cent 1 Cent
$100,000 $2,345 $530 $ 2.38 $ 4.75 $ 7.13 $ 9.50 $200,000 $5,180 $1,089 $ 4.88 $ 9.75 $ 14.63 $ 19.50 $300,000 $8,014 $1,647 $ 7.38 $ 14.75 $ 22.13 $ 29.50 $500,000 $13,683 $2,763 $ 12.38 $ 24.75 $ 37.13 $ 49.50 $600,000 $16,517 $3,322 $ 14.88 $ 29.75 $ 44.63 $ 59.50
Average Homestead Taxable Value $208,908 $5,527 $1,166 $ 5.43 $10.87 $16.30 $21.73
Estimated Tax Rate Impact to General Fund Revenue (M&O Tax Rate)
Collection Rate 1/4 Cent 1/2 Cent 3/4 Cent 1 Cent
FY 2022 Total Taxable Value: $131,872,522,294 98% $ 2,359,977 $ 5,128,764 $ 7,983,242 $ 10,838,344
1 Includes market value less the impact of the .01% Homestead Exemption which results in the statutory minimum of a $5,000 exemption. 20
HOT Fund – Debt Outstanding
Effective Interest Rate: 3.98% Average Life: 14.7 years
Airport Fund – Debt Outstanding
* Does not include $62 Million in Interim Financing Notes
Effective Interest Rate: 2.66% - 5.75% Average Life: 7.3 – 15.5 years
S&P and Fitch have both assigned a Negative Outlook to the Airport’s Bond Ratings
DEBT MANAGEMENT PLAN
FINANCE DEPARTMENT
Ad Valorem Debt Per Capita in Texas
Direct and Overlapping Debt
Recent Financing – FY 2021
Property TaxTaxable Valuation % Change from Prior Year
FY 2022 Property Tax Statistics
Slide Number 17
Slide Number 18
Homestead Exemption Scenarios
HOT Fund – Debt Outstanding
Airport Fund – Debt Outstanding
Slide Number 27
Historical Tax Rate
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Property Tax Debt 1,2,3 $2,276.3M 2.07% 8.2 PFC Lease Revenue Bonds – Convention Center Expansion 4 538.6M 3.98% 14.7 Airport - GARB 149.1M 3.34% 9.0 Airport – PFC 100.1M 2.66% 7.3 Airport – CFC 121.1M 5.75% 15.5 Stormwater 44.4M 1.25% 4.4 Contract Revenue Bonds – Starbright (Toyota) 15.2M 4.32% 7.0 Municipal Facilities Corporation (MFC)
MFC Lease Revenue Bonds - Fire and Police Dispatch Center (PSAP) 22.4M 5.09% 12.0 MFC Contract Revenue Notes – Brooks 2 5.4M 2.40% 7.3 MFC Fixed Rate Revenue Bonds – City Tower 59.8M 2.55% 18.2 MFC Variable Rate Revenue Bonds – City Tower 30.6M 2.47% 28.5
Total 5 $3,363M 1 Includes general obligation bonds, certificates of obligation, tax notes and public property finance contractual obligations. 2 Includes private placement debt. 3 Includes self-supporting debt in the amount of $315.2 Million including $62 Million in Interim Financing Notes for the Airport. 4 Includes Capital Appreciation Bonds with proceeds in the amount of $30.0 Million and a maturity value of $99.5 Million. 5 Does not include Bonds in the amount $168.3 Million related to the Convention Center Hotel scheduled to be paid from revenue generated from Hotel Operations.
Outstanding Effective Average Principal Interest Rate Life (Years)
Bond Ratings
High Grade AA+ Aa1 AA+
AA Aa2 AA
AA- Aa3 AA-
Upper medium grade
A+ A1 A+
A A2 A
A- A3 A-
Lower medium grade
BBB+ Baa1 BBB+
BBB Baa2 BBB
BBB- Baa3 BBB-
Current Bond Ratings
Property Tax Debt AA+ Aaa AAA
PFC Lease Revenue Bonds – Convention Center Expansion AA Aa2 AA+
Airport Revenue Bonds A+ A1 A
Airport - Passenger Facility Charge Bonds A A2 A-
Airport – Customer Facility Charge Revenue Bonds BBB+ A3 BBB+
Stormwater Bonds AA+ Aa2 AA+
Contract Revenue Bonds – Starbright (Toyota) AA Aa1 AA+
MFC Lease Revenue Bonds – Public Safety Emergency Dispatch Center
AA Aa1 AA+
Property Tax – Debt Outstanding
General Obligation Bonds $1,588.3 Million Certificates of Obligation $538.5 Million Tax Notes $140.3 Million Public Property Finance Contractual Obligations $9.1 Million
Effective Interest Rate: 2.07% Average Life: 8.2 years
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Bond Rating: “AA+” / “Aaa” / “AAA” by Fitch, Moody’s, and S&P Moody’s has assigned a Negative Outlook to its Bond Rating
Actual Debt vs. Legal Capacity*
7
• State Law and the City Charter provide legal limits for Ad Valorem Debt
Should not exceed 10% of Total AV
– Ceiling: $15.1 Billion
Property Taxes levied for debt must not exceed $1.50 per $100 of AV
– Current Debt Portion of Property Tax Rate is 21 cents for every $100 of AV
[In $Billions]
8
$1,998
Corpus Christi
*San Antonio – One of the lowest
_______________ SOURCE: Municipal Advisory Council of Texas as of September 30, 2020.
9
$4.5 Billion excluding School Districts
• School District debt totals an additional $4.5 Billion and varies by geographic location
Alamo Heights ISD $95M
East Central ISD 58M
• Assumes no change in Debt Service Tax Rate
• Capacity analyses
• Sensitivity analyses
Debt Management Plan Ad Valorem Actual and Projected Issuances 1
0
200
400
600
800
1,000
1,200
1,400
1,600
$109.7 $140.2 $115.0
$550.0 $592.0 $850.0
General Obligation Certificates of Obligation Tax Notes PPFCO Self Supporting **
* Amount includes Interim financing for Airport 1 Preliminary update
**Self Supporting debt paid from non-property tax revenues
11
(In Millions)
Total Debt Issuances $4,545.9
Total Refunded Debt ($1,347.9)
Total Principal Paid ($1,840.4)
Total Cash Defeasance ($4.9)
Recent Financing – FY 2021
Obligation
• May 12, 2021
• Privately placed debt
• Financed the cost of capital expenditures related to City- owned Witte Museum
• True Interest Cost 2.01%
Obligation
• True Interest Cost 2.58%
$229.1 Million General Obligation
• August 10, 2021
• Financed FY 2017 Bond Program and FY 2021 Capital Budget projects
• True Interest Cost 1.88%
Total Assessed Value $156.337 Billion Total Taxable Value $131.873 Billion
Proposed Tax Rates Tax Levy 1
M&O Tax Rate $0.34677 $410,350,992 Debt Service Tax Rate $0.21150 $250,278,959 Total Tax Rate $0.55827 $660,629,951
* Based on Tax Year 2021 Certified Bexar Appraisal District Values as July 24, 2021. 1 Includes impact of TIRZ contributions, delinquencies, and Over Age 65 and Disabled property tax freeze.
FY 2022 Property Tax Summary*
14
-5.0%
0.0%
5.0%
10.0%
15.0%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Base -4.1% -1.6% -0.3% 3.0% 4.5% 9.9% 7.9% 5.5% 6.7% 4.0% 3.1% New 1.7% 1.1% 1.3% 1.5% 1.7% 2.9% 2.0% 2.1% 1.8% 1.6% 1.9% TTL -2.4% -0.5% 1.0% 4.5% 6.2% 12.8% 9.9% 7.6% 8.5% 5.6% 5.0%
Actuals – Average: 5.29% Proposed
2022 2.1% 1.6% 3.7%
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Commercial $67.8 Billion
Residential $64.0 Billion
480,803 Total Parcels • Residential 370,569 • Commercial 110,234
235,910 Resident Homesteads • 45% of Resident Homesteads
have Over Age 65 & Disabled Exemptions and have frozen tax bills
17
28,412 senior and disabled homeowners pay $0 City Property Taxes
18
Council District
Average Homestead
Market Value
Average Homestead
Taxable Value
Homestead Total Proposed
FY 2022 Tax Rate .01% * 1% 2% 3% 4% 5% Value 1 Tax Bill $0.55827 Exemption Exemption Exemption Exemption Exemption Exemption
$100,000 $2,345 $530 $28 $28 $28 $28 $28 $28 $200,000 $5,180 $1,089 $28 $28 $28 $33 $45 $56 $300,000 $8,014 $1,647 $28 $28 $33 $50 $67 $84 $500,000 $13,683 $2,763 $28 $28 $56 $84 $112 $140 $600,000 $16,517 $3,322 $28 $33 $67 $100 $134 $167
Average Homestead Taxable Value $208,908 $5,527 $1,166 $28 $28 $28 $33 $45 $56
Revenue Loss to General Fund $3,777,599 $3,836,743 $4,321,433 $5,390,264 $6,785,083 $8,303,867 Revenue Loss to Debt Service Fund 2,304,012 2,340,085 2,635,704 3,287,599 4,138,320 5,064,648
Total Revenue Loss $6,081,611 $6,176,827 $6,957,136 $8,677,864 $10,923,403 $13,368,515
* The .01% Homestead Exemption results in the statutory minimum of a $5,000 exemption.
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1 Includes market value less the impact of the .01% Homestead Exemption which results in the statutory minimum of a $5,000 exemption.
FY 2022 Tax Rate Impact Estimated Tax Rate Impact to Homeowner
Homestead Total Proposed
FY 2022 Tax Rate Value 1 Tax Bill $0.55827 1/4 Cent 1/2 Cent 3/4 Cent 1 Cent
$100,000 $2,345 $530 $ 2.38 $ 4.75 $ 7.13 $ 9.50 $200,000 $5,180 $1,089 $ 4.88 $ 9.75 $ 14.63 $ 19.50 $300,000 $8,014 $1,647 $ 7.38 $ 14.75 $ 22.13 $ 29.50 $500,000 $13,683 $2,763 $ 12.38 $ 24.75 $ 37.13 $ 49.50 $600,000 $16,517 $3,322 $ 14.88 $ 29.75 $ 44.63 $ 59.50
Average Homestead Taxable Value $208,908 $5,527 $1,166 $ 5.43 $10.87 $16.30 $21.73
Estimated Tax Rate Impact to General Fund Revenue (M&O Tax Rate)
Collection Rate 1/4 Cent 1/2 Cent 3/4 Cent 1 Cent
FY 2022 Total Taxable Value: $131,872,522,294 98% $ 2,359,977 $ 5,128,764 $ 7,983,242 $ 10,838,344
1 Includes market value less the impact of the .01% Homestead Exemption which results in the statutory minimum of a $5,000 exemption. 20
HOT Fund – Debt Outstanding
Effective Interest Rate: 3.98% Average Life: 14.7 years
Airport Fund – Debt Outstanding
* Does not include $62 Million in Interim Financing Notes
Effective Interest Rate: 2.66% - 5.75% Average Life: 7.3 – 15.5 years
S&P and Fitch have both assigned a Negative Outlook to the Airport’s Bond Ratings
DEBT MANAGEMENT PLAN
FINANCE DEPARTMENT
Ad Valorem Debt Per Capita in Texas
Direct and Overlapping Debt
Recent Financing – FY 2021
Property TaxTaxable Valuation % Change from Prior Year
FY 2022 Property Tax Statistics
Slide Number 17
Slide Number 18
Homestead Exemption Scenarios
HOT Fund – Debt Outstanding
Airport Fund – Debt Outstanding
Slide Number 27
Historical Tax Rate
