Gilbert may not be able to issue $82 million of authorized but unissued general obligation debt due to plummeting property values in the Phoenix suburb.
Voters approved $57 million of bonds in 2001 and $174 million in 2007. The unissued bonds from the two authorizations would provide $11.8 million for upgrades to three city parks and $71 million for street projects.
Assistant town manager Marc Skocypec told the City Council last week that county-assessed property values in Gilbert dropped 3.4% in fiscal 2010, with valuations expected to fall significantly through fiscal 2012.
He said property values are expected to drop by 15% to 25% a year in fiscal 2011 and 2012.
Skocypec said the current property tax rate of $1.15 per $100 valuation would have to go to $1.30 per $100 in fiscal 2011 and $1.55 in fiscal 2012 to support the unissued bonds.
Gilbert’s GO debt is rated AA by Standard & Poor’s and Aa2 by Moody’s Investors Service. The city’s population is estimated at approximately 215,000, up dramatically from fewer than 30,000 in 1990.