SR-08-12-2014-7BAgenda
To: Mayor and City Council
From: Gigi Decavalles- Hughes, Director of Finance
Subject: Ordinance Setting the FY 2014 -15 Tax Rate for the 2012 Library General
Obligation Refunding Bonds
Recommended Action
Staff recommends that the City Council adopt the attached ordinance setting the FY
2014 -15 tax rates for the 2012 Library general obligation bonds.
Executive Summary
The City Council is required by ordinance to annually set property tax rates to generate
funds to pay the debt service on voter - approved general obligation bonds. The City
currently has one outstanding general obligation bond issue. The bonds were originally
issued in 2002 for construction, improvement, and remodeling of the Main Library and
branch libraries. They were refunded in May 2012, resulting in debt service savings.
Staff requests that Council adopt the attached ordinance setting the FY 2014 -15 rate at
$.004916 per $100 of assessed valuation.
Background
From FY 1990 -91 through FY 2001 -02, the tax rate for Library bonds was set on the
annual debt payment for the 1990 Library Bonds (refinanced in 1998). The 1998
refunded bonds were paid off in 2010 and are no longer included in the tax calculation.
On August 27, 2002, the City issued $25 million in additional voter - approved General
Obligation bonds for construction, improvement, and remodeling of the Main Library and
branch libraries. In order to take advantage of the low interest rate environment, all
outstanding 2002 bonds were refunded by issuance of 2012 Library General Obligation
Refunding Bonds in May 2012.
1
Discussion
Staff calculated the total FY 2014 -15 property tax rates for the 2012 refunding bonds to
be $.004916 per $100 of assessed valuation. The FY 2014 -15 assessed values used to
calculate the rates are based on preliminary assessed value information from the Los
Angeles County Assessor. Final assessed values were not available at the time of this
report. Any differences between preliminary and final values should be minor and will
be accounted for in next year's. rate calculations. The change from the prior year rate of
$.005504 per $100 of assessed valuation reflects the FY 2014 -15 assessed valuation
increase (5.6 %).
Attachment A provides further detail on the calculations.
Financial Impacts and Budget Actions
The tax revenue generated from the Library Bonds tax rate should be sufficient to cover
FY 2014 -15 debt service payments of $1,486,350. Both the revenues (account number
01274.404660) and the expenditures (account number 01274.555300) are included in
the FY 2014 -15 Adopted Budget.
Prepared by: David Carr, Assistant City Treasurer
Approved:
QCr-dit
Gigi Decavalles- Hughes
Director of Finance
Attachments:
A. Calculation of Tax Rates
B. Ordinance
2
Forwarded to Council:
Rod Gould
City Manager
Reference:
Ordinance No. 2466
(CCS)