Study Session - Financing Options for Capital ImprovementsMEETING DATE: 05-02-05
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COUNCIL AGENDA REPORT
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DATE: APRIL 28, 2005
TO: MAYOR AND TOWN COUNCIL
FROM: DEBRA J. FIGONE, TOWN MANAGER
SUBJECT: PRESENTATION AND DISCUSSION OF FINANCING OPTIONS FOR
CAPITAL IMPROVEMENTS AND PROJECTS
The purpose of the study session is to provide Council with information about various financing
options for.capital facilities. While no decision about financing public improvements is needed in
the short term, the Town faces several issues and opportunities for which public financing may be
a consideration in the future. These issues and opportunities include: a dedicated source for capital
infrastructure improvements (such as streets, sidewalks, retaining walls, etc.); the Civic
Center/Library master planning process; land acquisition; affordable housing development; and
future redevelopment project area capital improvements.
Attached is the outline for the presentation which will be given by Emily Wagner, the Town's
financial advisor. Ms. Wagner assisted the Town with the is of the Certificates of
Participation used to finance redevelopment activities in the Town's redevelopment project area.
As noted on the outline, Ms. Wagner will begin with discussing financing methods in general,
followed by specific information on debt financing alternatives. She will also note financing
alternatives for operating and maintenance costs; however, this will not be the focus of the
presentation. In discussing debt financing alternatives, Ms. Wagner will provide examples about
how the alternatives might affect Los Gatos taxpayers. Ms. Wagner will also discuss process
considerations associated with pursuing debt financing alternatives, including public surveys to
gauge support and timing issues for seeking voter approval.
As noted previously, no financing decision or specific direction is expected from the Town Council
at the study session. Rather, the purpose of the study session is to provide basic information about
public financing alternatives for Council's consideration in the future as issues and opportunities that
may require public financing.
Attaclunent:
1. Outline for Presentation on Capital Financing Options
PREPARED BY: PAMELA S. JACOBS
ASSISTANT TOWN MANAGER
Reviewed by: Assistant Town Manager A )I~C~i'Town Attorney Clerk Administrator
Finance Community Development Revised: 4/28/05 11:30 an
Reformatted: 5/30/02
AGENDA
Monday, May 2,2005
TOWN OF LOS GATOS
CAPITAL FACILITY FINANCING OPTIONS
. OUTLINE FOR PRESENTATION
BY E. WAGNER & ASSOCIATES, INC.
I. TWO FINANCING METHODS
• Pay-as-you-go - Cash
• Pay-as-you-use - Debt
• Advantages and Disadvantages
II. DEBT FINANCING ALTERNATIVES
• General Obligation Bonds
• Certificates of Participation
• RDA Tax Allocation Bonds
1. 80% Monies
2. 20% Set-aside Monies
• CFD Special Tax Bonds
• Special Assessment District Bonds
III. AND THE SURVEY SAYS
IV. FUTURE CAPITAL INFRASTRUCTURE NEEDS OF LOS GATOS
V. SUMMARY OF FINANCING ALTERNATIVES FOR LOS GATOS' CAPITAL
FACILITY NEEDS