Bond Issuances

The city will issue debt only for the purpose of acquiring or constructing capital assets for the general benefit of residents and to allow it to fulfill its various missions as a city. Debt may be issued for the purposes of purchasing land or rights-of-way and/or improvements to land, for construction projects to provide for the general good or for capital equipment.

Bond Ratings

Year
Agency
Rating
2017 Standard & Poor's AA+ Insured/ AA- Underlying
2014
Moody's
A1
2014
Standard & Poor's
AA+ Insured / A+ Underlying
2011
Standard & Poor's
AA+ Insured / A+ Underlying
2010
Standard & Poor's
AAA Insured / A+ Underlying
2008
Standard & Poor's AAA Insured / A Underlying


Bonds
Series 1996 - $455,000 Comb Tax & Rev CO
Series 1998 - $5,150,000 Comb Tax & Rev CO
Series 2006 - $300,000 Tax Notes
Series 2006 - $790,000 Comb Tax & Rev CO
Series 2007 - $1,200,000 EDC Sales Tax Revenue Bonds
Series 2007 - $2,900,000 Comb Tax & Rev CO
Series 2007 - $4,365,000 GO Refunding Bonds
Series 2007A - $2,735,000 Comb Tax & Rev CO
Series 2008 - $4,500,000 Comb Tax & Rev CO
Series 2010 - $2,000,000 Comb Tax & Rev CO
Series 2011 - $3,260,000 Comb Tax & Rev CO
Series 2016 - $3,720,000 GO Refunding Bonds
Debt Service Pay Off Schedule

General Obligation Bonds (GOs)


General obligation bonds will be used only to fund capital assets of the general government, are not to be used to fund operating needs of the city and are backed by the full faith and credit of the city, as well as the ad valorem tax authority of the city. General obligation bonds must be authorized by a vote of the residents of the City of Kennedale.

Revenue Bonds (RBs)


Revenue bonds will be issued to provide for the capital needs of any activities where the capital requirements are necessary for continuation or expansion of a service, which produces a revenue and for which the asset may reasonably be expected to provide for a revenue stream to fund the debt service requirements.

Certificates of Obligation (COs)


Certificates of obligation will be used to finance permanent improvements and land acquisition, the need for which arises between bond elections. In addition, they may also be used to finance costs associated with capital project overruns or to acquire equipment. Debt service for COs may be from general tax revenues under certain circumstances as defined by law. They may also be backed by a specific revenue stream(s) or by a combination of tax revenues and specific revenue streams.

Method of Sale


The city will use a competitive bidding process in the sale of bonds, unless the nature of the issue warrants a negotiated bid. In situations where a competitive bidding process is not elected, the city will present the reasons why, and the city will actively participate with the financial advisor in the selection of the underwriter or direct purchaser.

Bidding Parameters


The notice of sale will be carefully constructed so as to ensure the best possible bid for the city, in light of the existing market conditions and other prevailing factors. Parameters to be examined include:
  • Limits between lowest and highest coupons
  • Coupon requirements relative to the yield curve
  • Method of underwriter compensation, discount or premium coupons
  • Use of true interest cost (TIC) versus net interest cost (NIC)
  • Use of bond insurance
  • Deep discount bonds
  • Variable rate bonds
  • Call provisions

Analysis of Financing Alternatives


Staff will explore alternatives to the issuance of debt for capital acquisitions and construction projects. These alternatives will include, but not be limited to: 1) grants in aid, 2) use of reserves, 3) use of current revenues, 4) contributions from developers and others, 5) leases, and 6) impact fees.

Disclosure


Full disclosure of operations will be made to the bond rating agencies and other depositories of financial information as required by the Securities and Exchange Commission (SEC) Rule 15c2-12, specifically, Texas Municipal Advisory Council (State Information Depository).

Rating Agency Communication


The city staff will seek to maintain and improve its current bond rating so its borrowing costs are reduced to a minimum and its access to credit preserved. The city staff, with the assistance of financial advisors and bond counsel, will prepare the necessary materials for presentation to the rating agencies, will aid in the production of Official Statements, and will take responsibility for the accuracy of all financial information released.


Federal Requirements


The city will maintain procedures to comply with arbitrage rebate and other federal requirements.