Tarrant County, Tex., Preps $110M; Arlington Sets $141M Election

DALLAS - Triple-A rated Tarrant County, Tex., is bringing $112 million of limited-tax bonds to market next week to complete funding for renovations to the county jail and medical examiner facilities.

JPMorgan is lead manager for the negotiated sale on Tuesday. Estrada Hinojosa & Co., Siebert Brandford Shank & Co., and Morgan Keegan & Co. are co-managers.

First Southwest Co. is the financial adviser to the county. Kelly Hart & Hallman LLP and Fulbright & Jaworski LLP are co-bond counsel.

Proceeds also will fund continued improvements to roads and bridges and upgrades to the civil courts building.

The Series 2008 bonds, which are structured as serials reaching final maturity in 2028, won't be insured due to the county's triple-A credit.

"The way the market is today, maintaining our triple-A rating is significant for the county and its taxpayers," said county administrator G.K. Maenius. "Our financial adviser told us recently that we're in the best position anyone going to market to borrow can be in."

This is the third issue from a $433 million bond referendum - the largest in county history - approved by voters in May 2006. Following next week's sale, the city will have $198 million of authorized but unissued debt, which includes some from a 1998 bond package. The 2006 bond package represents the county's seven- to eight-year debt program that calls for annual issuances. Officials expect to bring another $50 million to $53 million to market within 12 months.

Standard & Poor's cited manageable debt plans, continued expansion and broadening of a sizable property-tax base, and good financial management as it assigned the AAA rating to the sale. Analysts also said the strong rating is indicative of wealth and income levels in the county that are at about 108% of the national average.

The county's fiscal 2008 taxable-assessed value of about $113.6 billion rose 7% from a year earlier and is roughly 34% higher than $84.6 billion in fiscal 2004.

Tarrant County is one of the fastest growing in the country, adding more than 225,000 new residents since 2000, according to the Census Bureau. The estimated 2008 population is nearly 1.75 million. The population of Fort Worth, the county seat, has risen roughly 31% since 2000 to nearly 703,000.

The county has benefited greatly the past decade or so from new fracturing technology and horizontal-drilling techniques allowing for the extraction of natural gas from the Barnett Shale, a geological formation that sits below much of Tarrant County, as well as neighboring counties. As a result, numerous drilling sites have sprung up all across the area during the past few years, tapping this heretofore-untouched natural-gas repository.

Maenius called the new technologies and increased drilling in the Barnett Shale "a great gift to Tarrant County."

Earlier this week, the Arlington City Council decided to call for a November bond election of $140.8 million in five propositions. The largest proposition at $103.7 million is for road improvements. The council originally considered putting the referendum before voters in May but decided to wait and hold it in conjunction with the presidential election and allow time to review more potential projects.

The city, which sits entirely in Tarrant County and is nearly equidistant from Dallas and Fort Worth, has been rapidly improving roads the past few years, especially near the new Dallas Cowboys stadium that will open sometime next year. Another overpass across Interstate 30, specifically built to address the expected traffic needs of the stadium, is under construction. And upgrades to I-30 through Arlington are also underway.

In May, Standard & Poor's raised it underlying rating on the city to AA-plus from AA. The city's general obligation debt is rated AA by Fitch Ratings and Aa2 by Moody's Investors Service.

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