Sherman took the first step Monday in its plan to issue more than $19 million in debt later this year.
The Sherman City Council approved a resolution that authorizes the publication of the notice of the city’s intent to issue up to $19.5 million in certificates of obligation in September.
“It’s a competitive bid in the market, our financial adviser takes care of all that,” Director of Finance Mary Lawrence said in response to a question about the process following the council’s approval. “This will come back to you (the council) in the form of an ordinance after the debt is issued. The issuance is for 25 years and the debt service is already included in the (fiscal year) 2019 budget.”
Lawrence also explained the funds generated from the sale of the certificates of obligation will go toward the construction of sports fields at Pecan Grove West Park, infrastructure in the city’s Tax Increment Reinvestment Zone No. 7 on the southeast corner of the intersection of U.S. Highway 75 and FM 1417, participation in work begin done by the Texas Department of Transportation and street projects such as the West Travis Street development.
“These are projects that we’ve talked about for a couple of years now, projects that are the next step in preparing the infrastructure and the other amenities, like the park,” City Manager Robby Hefton said. “This was things that we talked about in the budget workshop, so it’s already kind of built in to the 2019 budget, as Mary said.”
Lawrence said city staff plans to issue the debt in September, with proceeds from the sale excepted a few weeks later.
“We’re hoping for a good rate,” Hefton said. “We believe it’ll be issued at once, and that include the issuance cost as well.”
In a document prepared for the council, city staff noted the estimated debt service for the certificates of obligation will be approximately $1.3 million and will be paid for through Sherman’s ad valorem tax revenue. The cost of advertising the issuance is expected to be around $500.
The work being done by TxDOT includes a the widening of FM 1417 and a ramp reversal project on northbound Hwy. 75, south of the TIRZ No. 7 development. That reinvestment zone was put in place last year and is where the Schulman’s Movie Bowl Grille development will be on the city’s south side.
“I’m excited about the park,” Hefton said of which project he was most looking forward to seeing complete. “(I’m) excited about the roads as well, but it’s kind of a little bit more difficult to be excited about streets than it is about a nice park. All of them are important, but particularly interested in seeing how the park turns out.”
The planned Pecan Grove Athletic Complex will include four baseball and softball fields, a large soccer area that could incorporate multiple fields at once, and some neighborhood park features such as a splash pad, playground and pavilion.