DALLAS - Keller plans to bring two tranches of general obligation debt worth nearly $12.4 million to the competitive market next week as the growing suburb north of Fort Worth begins polling residents about a possible bond election in November.
Through an online poll on the city's Web site and phone surveys, officials hope to gauge the electorate's thoughts on capital projects and possible tax rates associated with a bond package.
On Tuesday, the city will offer about $8.4 million of combination tax and revenue certificates of obligation and $4 million of general obligation bonds. Proceeds from the bonds will fund library improvements, while the COs will fund upgrades to fire stations, parks and drainage, and equipment purchases.
First Southwest Co. is the city's financial adviser and McCall, Parkhurst & Horton is bond counsel.
Earlier this month, both Standard & Poor's and Moody's Investors Service upgraded the city's underlying credit.
Moody's raised its rating for the city to Aa3 from A1 citing a "healthy tax base with very high wealth indices," as well as stable financial operations. Standard & Poor's bumped its rating to AA from A-plus.
"We're pretty excited about the upgrades, as we've always felt we're a pretty good credit risk," city manager Dan O'Leary said. "Keller is a very stable community and we're not as dependent upon sales tax revenues as some other cities. We're a strong property-tax based city that's not been hit as hard as other others that've seen sales tax declines. Now, we may face a downturn down the line with the housing crisis, but right now we're not experiencing any of that."
Keller's current population of 38,400 is up 16% from 2005 and the city's 2009 taxable-assessed valuation of $3.73 billion is 40% higher than five years ago.
In 2006, roughly seven new homes were being built each day in Keller, according to the Tarrant County appraisal district. O'Leary estimates the city is about 80% built out residentially and home construction has abated somewhat recently.
The city's population doubled in the 1990s and 75% of the tax base is residential, according to analysts.
Moody's said the city's general fund rose to $7 billion for fiscal 2007 from $2.3 billion five years earlier.
O'Leary said there's about $50 million to $60 million of needed projects and officials chose to solicit voter input for two reasons.
"One was to get some input on the community's priorities," he said. "And the second reason was to gauge the willingness of the voters to invest in some of these things in light of the current economic conditions. "
In November 2006, Keller residents, who tend to be fiscally conservative, forced the city to put the bonds for the library improvement to a vote, after the city council initially wanted to use COs, which don't require voter approval. The bonds were approved.
And last November, voters within the Keller Independent School District approved a $142.3 million proposition for campus improvements while rejecting $25.6 million for a second football stadium.
"Keller is one of the fastest growing cities in the Dallas-Fort Worth area," Mayor Pat McGrail said in a release announcing the survey. "It is important that we receive comments from Keller citizens on future capital improvement projects, which will ultimately enhance the quality of life for all residents."