The City Council has a long list of projects they’re looking over right now to help prepare for the town’s growth, and at such a high cost, they may look at taking on additional debt to pay for some of it.
Council members met Tuesday with George Williford, the managing director of the city’s financial advisor, Hilltop Securities, who told them about options for pursuing a debt issuance.
One option is a general obligation bond, but that would require an election. The other option is a certificate of obligation, which he said were often used for general purpose issuances and financing, as well as utilities improvements. For a certificate of obligation, the city council would pass a resolution to publish a notice of intent to issue the certificate for two consecutive weeks at least 31 days before the certificate is authorized. During that time, the public can establish a petition contesting the certificate, which requires signatures from 5% of registered voters in the city, which Williford said succeeds pretty rarely.
“I think you’ve got to look at whatever means available to fund our needs,” District 2 Council Member Dewey Bryant said. “We have some needs that need to be addressed and we need to make conscientious efforts to see what’s best for our community right now.”
Bryant called the meeting preliminary, just seeing what options the city had in regards to taking on debt and seeing what other communities have done. The list of projects they have runs up to nearly $200 million, and Williford said the city currently has an outstanding debt of nearly $100 million.
Out of that debt, Williford said $43.29 million was self-supported by the utilities system, leaving $56.18 million of general purpose debt. And that number will reduce by 2024, with overall debt down to about $50 million, and $32.36 million of that debt being general purpose, which he said was a pretty significant paydown, leaving room to take on additional debt.
Exactly what the debt will be used for is still a step away from where the city is at yet, as Williford said they first need to determine an amount of money they can take on as debt, not necessarily how that money will be used. Bryant compared the process to buying a car.
The list of projects is wide-ranging, covering needs for the Odessa Police Department, Odessa Fire Rescue, parks and recreation and public works. OPD is asking for a new animal shelter, which they priced at $10.5 million, but some city officials have said they can do it for about $9 million by using a metal building with a different facade on the front. They’re also asking for the completion of their multipurpose building, where they would be housing their police academy.
Interim Assistant City Manager Cindy Muncy said OFR told them their most critical project would be the relocation of Fire Station No. 6 from 3414 Brentwood Ave., to the intersection of Grandview and Maple Avenues, which has an estimated cost of about $9.5 million, with plans to expand the station into a substation, with administrative offices and training rooms, in the future.
Improvements to Floyd Gwin Park are also needed, at an estimated cost of $6 million, and they are also talking about updating Sherwood Park by adding basketball courts, but want to set aside about $3 million for general repairs and updates to city parks.
That leaves a long list of roadway projects the city needs to look at, with the most critical and expensive project of them to be a widening and full depth reconstruction of Faudree Road, at a cost of about $19.7 million. The city is also looking at the design and reconstruction of Grant Street from 10th Street to Second Street, and Second Street from I-20, both projects totaling about $22 million together.
“We’ve talked in the past about whether or not the city would have the appetite to take on Grant Street as part of this revitalization effort,” Marrero said. “TxDOT would be probably more than happy to give that to us, but that means that we take it not just from Second Street, you’d have to take it from Second Street all the way to Kermit Highway.”
Marrero said some of that rehabilitation could include the widening of sidewalks and reduction of lanes downtown, but said the city understood that isn’t a popular idea for some people. The city could also just make sure TxDOT maintains those projects as priorities, he said, and said if they set aside some funds for enhancements to the road, TxDOT could pay the bulk of the expense associated with the project.
At the end of the meeting, Bryant said they didn’t come out with any priorities for where they want to see the money spent, but said they would discuss those priorities in the coming months if they could find a level of debt payment that was comfortable to the city.
