Full Text
211 SECTION 13: LONG-TERM DEBT The City has various long- term commitments for payments to debt obligations to be repaid from various revenue sources. These obligations are discussed in this section and supported with the June 30, 2012 audited information. REVENUE BONDS 2008 Sales Tax Revenue Bonds- Street Improvements In FY 2008, $11.75 million of Sales Tax Revenue Bonds were issued at 4.4%-4.75% interest with approximately $10 million of bond proceeds to be used to finance the City’s Street Improvement Project. The estimated cost of the initial four-year project was approximately $17 million. After use of bond proceeds, remaining project funding will come from ongoing sales tax revenues not required for debt service and other funds available for this type of work. The City continues efforts to obtain all possible Federal and State funding for street improvements, including utilizing proceeds of the bonds as matching funds for Federal and State grant funding. The bond interest is payable each November 1 and May 1 through May 1, 2037. Table 13-1 2008 Sales Tax Revenue Bonds- Street Improvements Original Issue Amount Balance June 30,2011 Additions Retirements Balance June 30,2012 Street Improvement Bonds $11,750,000 $11,055,000 $0 $245,000 $10,810,000 Table 13-2 Future debt service payments on the 2008 Sales Tax Revenue Bonds – Street Improvements Fiscal Year Ending June 30 Principal Interest Total 2013 255,000 484,077 739,077 2014 265,000 475,152 740,152 2015 270,000 466,407 736,407 2016 280,000 457,228 737,228 2017 290,000 447,078 737,078 2018-2037 9,450,000 4,582,868 14,032,868 $10,810,000 $6,912,810 $17,722,810 Storm Drain Revenue Bonds The City of El Cerrito 1993 Storm Drain Revenue Bonds were issued in the principal amount of $6,300,000, bearing interest from 4.3% to 5.5% and maturing each August 1 through 2013. Interest was payable each February and August 1. The bonds consisted of $4,440,000 in serial bonds and $1,860,000 in term bonds. Bonds maturing on or after August 1, 2004 were subject to optional redemption by the City with premium. Bonds maturing August 1, 2013, (the term bonds) were subject to mandatory sinking fund redemption commencing August 1, 2010. In FY 2012, the City issued Storm Drain Revenue Refunding Bonds in the original principal amount of $1,026,800 at 1.683% interest. The bonds are secured by a first pledge of all revenues ---PAGE BREAK--- 212 derived from ownership and operation of the storm drain system and the monies held in funds established by the Bond Indenture in amount sufficient to pay the bond debt service, maintenance and operations costs of the system, and to maintain the bond reserve fund. The interest is payable each August 1 and February 1 through August 1, 2013. Table 13-3 Storm Drain Bonds Original Issue Amount Balance June 30,2011 Additions Retirements Balance June 30,2012 1993 Storm Drain Revenue Bonds $6,300,000 $1,435,000 $0 $1,435,000 $0 2012 Storm Drain Revenue Refunding Bonds $1,026,800 $0 $1,026,800 $0 $1,026,800 Table 13-4 Future Debt Service Payments on the Storm Drain Bonds Fiscal Year Ending June 30 Principal Interest Total 2013 $512,300 $6,202 $518,502 2014 514,500 4,330 518,830 $1,026,800 $10,532 $1,037,332 Measure A Lease Revenue Bonds- Swim Center Project The El Cerrito Public Financing Authority issued 2002 Lease Revenue Bonds, which consisted of $4,615,000 in bonds bearing interest at 3.00% to 4.75%. The interest is payable each August 15 and February 15. Principal is payable each August 15, through August 15, 2020. The outstanding principal balance of the bonds at June 30, 2012 was $2,685,000. The bonds are secured by a pledge, security interest in, and a first and exclusive lien on all base rental payments and other payments paid by the City and received by the Authority and the monies in the funds and accounts established pursuant to the Bond Indenture of Trust. The payment of bond principal and interest is also covered by a financial guaranty insurance policy. In FY 2013, the 2002 Lease Revenue Bonds were refinanced at a rate of 1.80% on a refunded principal amount of $2,516,500 with the first principal payment due on September 1, 2013. The interest is payable each September 1 and March 1 through September 1, 2020. Table 13-5 2002 Lease Revenue Bonds Original Issue Amount Balance June 30,2011 Additions Retirements Balance June 30,2012 2002 Measure A Lease Revenue Bonds $4,615,000 $2,930,000 $0 $245,000 $2,685,000 Table 13-6 Future scheduled annual minimum debt service requirements for the Measure A Lease Refunding Fiscal Year Ending June 30 Principal Interest Total 2013 0 21,236 21,236 2014 312,800 46,258 359,058 2015 323,300 40,024 363,324 2016 328,200 33,639 361,839 2017 332,300 27,167 359,467 2018-2021 1,219,900 43,353 1,263,253 $2,516,500 $211,678 $2,728,178 City Hall Lease Revenue Bonds ---PAGE BREAK--- 213 The El Cerrito Public Financing Authority issued 2006 Lease Revenue Bonds, which consisted of $9,610,000 in bonds bearing interest at 3.75% to 5.0%. The interest is payable each June 1 and December 1, with the final payment on November 15, 2036. The bonds are secured by a pledge, security interest in, and a first and exclusive lien on all base rental payments and other payments paid by the City and received by the Authority and the monies in the funds and accounts established pursuant to the Bond Indenture of Trust. Table 13-7 2006 City Hall Lease Revenue Bonds Original Issue Amount Balance June 30,2011 Additions Retirements Balance June 30,2012 2006 City Hall Lease Revenue Bonds $9,610,000 $9,225,000 $0 $205,000 $9,020,000 Table 13-8 Future Debt Service Payments on City Hall Lease Revenue Bonds Fiscal Year Ending June 30 Principal Interest Total 2013 215,000 384,008 599,008 2014 220,000 375,308 595,308 2015 230,000 366,767 596,767 2016 240,000 357,246 597,246 2017 250,000 347,240 597,240 2018-2036 7,865,000 3,970,219 11,835,219 $9,020,000 $5,800,788 $14,820,788 CAPITAL LEASE OBLIGATIONS Master Equipment Lease- Fire Trucks, Recycling Trucks and Toters Between FY 2005-06 and FY 2009-10, the City entered into lease agreements to finance the acquisition of three fire trucks. The leases interest rates varied from 3.90% to 4.80% with annual payments of about $165,000 through 2017. Recycling Trucks and Toters In FY 2008-09 and FY 2009-20, the City entered into lease agreements to finance the acquisition of recycling trucks and toters. The lease interest rates varied from 3.980% to 4.85% with annual payments of about $183,000 through 2018. Master Equipment Lease In FY 2013, the City entered into a single master equipment lease agreement with Chase Bank to refinance the leases for the above fire trucks, recycling trucks, and recycling toters. The lease arrangement bears interest at a yield of 1.98% with interest payments due on July 25 and January 25 through July 25, 2019. Future minimum lease payments at June 30, 2012 are: ---PAGE BREAK--- 214 Table 13-9 Master Equipment Lease Fiscal Year Ending June 30 Amount 2013 124,210 2014 2015 248,420 248,420 2016 248,420 2017 248,420 2018-2020 621,050 Total minimum lease payments 1,738,940 Less amounts representing interest (110,766) Present value of net minimum lease payments $1,628,174 Recycling Center Capital Lease On November 1, 2010, the City entered into a capital lease agreement in the amount of $3,500,000 at 3.88% interest with Holman Capital to finance the reconstruction of the Recycling Center. The term of the lease provided for quarterly principal and interest payments of $80,225 through October 1, 2025. In July 2012, the Recycling Center Capital Lease was refinanced reducing the interest rate from 3.88% to 2.50%. The interest is payable each July 1, October 1, January 1, and April 1 through October 1, 2025. Table 13-10 Recycling Center Capital Lease Original Issue Amount Balance June 30,2011 Additions Retirements Balance June 30,2012 Recycling Center Capital Lease $3,500,000 $3,500,000 $0 $140,175 $3,359,825 Table 13-11 Future Recycling Center Lease Payments Fiscal Year Ending June 30 Amount 2013 2014 153,313 306,523 2015 306,619 2016 306,477 2017 306,497 2018-2026 2,605,821 Total minimum lease payments 3,985,251 Less amounts representing interest (579,651) Present value of net minimum lease payments $3,405,600 Solar Equipment Capital Lease On December 5, 2012, the City entered into a capital lease agreement in the amount of $1,595,000 at 2.75% interest with Green Campus Partners to finance the purchase and installation of solar equipment on City facilities. The term of the lease provides for semi-annual principal and interest payments of $65,236 on December 1 and June 1 through December 1, 2027. ---PAGE BREAK--- 215 Table 13-12 Solar Equipment Capital Lease Fiscal Year Ending June 30 Amount 2013 2014 65,236 130,473 2015 130,473 2016 130,473 2017 130,473 2018-2028 1,369,959 Total minimum lease payments 1,957,087 Less amounts representing interest (361,787) Present value of net minimum lease payments $1,595,300 Changes in Long-Term Liabilities Long-term liability activity for the fiscal year ended June 30, 2012 was as follows: Table 13-13 Long-term Liabilities Original Issue Balance Balance Amount June 30, 2011 Additions Retirements June 30, 2012 General LTD Fund 792 Street Improvement Bonds 11,750,000 $ 11,055,000 $ 245,000 $ 10,810,000 $ Storm Drain Revenue Bonds 6,300,000 1,435,000 1,026,800 $ 1,435,000 1,026,800 Measure A Lease Revenue Bonds 4,615,000 2,930,000 245,000 2,685,000 City Hall Lease Revenue Bonds 9,610,000 9,225,000 205,000 9,020,000 Total GLTD 32,275,000 $ 24,645,000 $ 1,026,800 $ 2,130,000 $ 23,541,800 $ Internal Service Fund 601 Fire Truck Capital Leases 1,429,108 $ 976,658 $ 88,970 $ 887,688 $ Total IS Commitments 1,429,108 $ 976,658 $ 88,970 $ 887,688 $ Enterprise Activity Debt Recycing Trucks Capital Lease 770,577 564,360 79,293 485,067 Recycling Toters Capital Lease 540,450 347,498 63,077 284,421 Recycling Center Capital Lease 3,500,000 $ 3,500,000 $ 140,175 $ 3,359,825 $ Total Enterprise Activity 4,811,027 $ 4,411,858 $ 282,545 $ 4,129,313 $ June 30, 2012 Long Term Debt City of El Cerrito Deferred Debt Expense Bond issuance costs are capitalized and amortized over the terms of the respective bonds using a method that approximates the effective interest method. ---PAGE BREAK--- 216 ---PAGE BREAK--- 217 SECTION 14: APPENDICES AND STATISTICS ---PAGE BREAK--- 218