HomeMy WebLinkAboutItem 10c - General Obligation Bonds
STAFF REPORT
ADMINISTRATIVE SERVICES DEPARTMENT
DATE: August 19, 2025
TO: Honorable Mayor and City Council
FROM: Henry Chen, Administrative Services Director
SUBJECT: RESOLUTION NO. 7646 DETERMINING THE AMOUNT OF REVENUE TO
BE RAISED FROM PROPERTY TAXES FOR FISCAL YEAR 2025-26 TO PAY
FOR THE DEBT SERVICE ON THE 2021 GENERAL OBLIGATION
REFUNDING BONDS (SERIES BOND MEASURE A AND SERIES POLICE
STATION PROJECT)
CEQA: Not a Project
Recommendation: Adopt
SUMMARY
The City has two General Obligation Bonds supported by voter-approved levies. In
2021, these bonds were refinanced into the 2021 General Obligation Refunding
Bonds (Series Bond Measure A and Series Police Station Project). Annually, the City
Council must adopt a resolution to establish the supplemental taxes collected to
make debt service payments for the outstanding General Obligation Bonds. The rates
established for Fiscal Year 2025-26 are estimated to generate tax revenue of
$488,700 and $353,600 for the 2021 General Obligation Refunding Bonds (Series
Bond Measure A and Series Police Station Project), respectively, and will be paid
directly by property owners as part of their annual property tax bills.
It is recommended that the City Council adopt Resolution No. 7646, determining the
amount of revenue to be raised from property taxes for Fiscal Year 2025-26 to pay
for the debt service on the 2021 General Obligation Refunding Bonds (Series Bond
Measure A and Series Police Station Project).
BACKGROUND
Two General Obligation Bonds were issued by the City, which were supported by
voter-approved levies. The Series 2011 issuance was to fund the building of a grade
Resolution No. 7646 Fiscal Year 25-26 Tax Levies
General Obligation Bonds
August 19, 2025
Page 2 of 4
separation at the intersection of Santa Anita Avenue and the Gold Line right-of-way
alignment; the Series 2001 General Obligation Bonds were used to finance the
construction of the City’s police station.
The issuance of Series 2001 General Obligation Bonds were approved in a Special
Election held on November 2, 1999; the Series 2011 issuance was approved by the
voters during the April 11, 2006, election. More than two-thirds of the votes cast were
in favor of the agreed indebtedness, with the principal and interest payable from
levies upon taxable property within the City. Both Bonds are payable entirely by ad
valorem property taxes levied on behalf of the City and collected by Los Angeles
County.
In 2012, the bond market provided an opportunity to refinance the Series 2001
General Obligation Bonds. As a result, General Obligation Bonds Series 2012 were
issued on November 6, 2012, solely for the refunding of the Series 2001, providing
savings of approximately $1 million for taxpayers over the life of the bonds.
In 2021, with interest rates near historical lows due to the COVID-19 pandemic,
conditions provided another opportunity to refinance both Series 2011 and 2012 of
the General Obligation Bonds. A private placement with Sterling Bank (subsequently
acquired by Webster Financial) was undertaken to refinance both the 2011 and 2012
Series General Obligations Bonds. The transaction closed on November 23, 2021, and
the private placement will yield roughly $840,000 in additional savings over the life
of the bonds.
Each year, a resolution must be adopted by the City Council to determine the amount
of revenue to be raised from property taxes, to pay for the debt service on the
General Obligation Bonds. This information is the basis for establishing tax rates,
which are forwarded to Los Angeles County and will be applied to properties within
the City’s boundaries.
DISCUSSION
A separate schedule (Exhibit “A”) illustrating the calculation of the tax rate is attached
to provide detail of the debt service payments, the assessed valuations, beginning
balances, estimated expenditures, and the proposed tax rate for Fiscal Year 2025-26.
Resolution No. 7646 Fiscal Year 25-26 Tax Levies
General Obligation Bonds
August 19, 2025
Page 3 of 4
The FY 2025-26 debt service payments for the Series Bonds Measure A Bonds total
$523,500, of which $488,000 represents Principal and $35,500 is Interest. For the
Series Police Station Project Bonds, the total amount due in FY 2025-26 is $409,100,
including $381,000 for Principal and $28,100 for Interest.
The levy rate for Series 2021 General Obligation Refunding Bonds (Series Bond
Measure A) is 0.002191%, in comparison to 0.002204% last year; the tax rate for the
2021 General Obligation Refunding Bonds (Series Police Station Project) is 0.001586%
versus 0.001549% for the prior year. The rates for Measure A bonds decreased
slightly due to an increase in assessment valuation for FY 2025-26. The Police Station
Bonds rate increased slightly due to a small increase in debt service for this Fiscal
Year. With these rates, a home valued at $1,000,000 would pay $21.91 in taxes for
the Series Bonds Measure A Bonds, and $15.86 for the Series Police Station Project
Bonds, as part of their annual property tax payments. Last year, the rates were
$22.04 and $15.49, respectively; therefore, the net impact of this rate adjustment
would be modest for most property owners.
ENVIRONMENTAL ANALYSIS
The proposed action does not constitute a project under the California
Environmental Quality Act (“CEQA”), as it can be seen with certainty that it will have
no impact on the environment.
FISCAL IMPACT
No General Fund costs are incurred through this action. The rates established for
Fiscal Year 2025-26 are estimated to generate tax revenue of $488,700 and $353,600
for the 2021 General Obligation Refunding Bonds (Series Bond Measure A and Series
Police Station Project), respectively, and will be paid directly by property owners as
part of their annual property tax bills. These tax revenues will be added to each bond
fund’s existing fund balances for debt service payments occurring in Fiscal Year 2025-
26.
RECOMMENDATION
It is recommended that the City Council determine that this action does not
constitute a project under the California Environmental Quality Act (“CEQA”); and
Resolution No. 7646 Fiscal Year 25-26 Tax Levies
General Obligation Bonds
August 19, 2025
Page 4 of 4
adopt Resolution No. 7646 determining the amount of revenue to be raised from
property taxes for Fiscal Year 2025-26 to pay for the debt service on the 2021
General Obligation Refunding Bonds (Series Bond Measure A and Series Police
Station Project).
Attachments: Resolution No. 7646
Exhibit “A” – Calculation of Tax Rate
WHEREAS, in a special election held on November 2, 1999, City of Arcadia
voters approved the issuance of General Obligation Bonds Series 2001 in the
principal of $8 million for the construction of a police facility; the 2001 Bonds were
defeased by the issuance of General Obligation Bonds Series 2012 on November 6,
2012; the 2012 Bonds were defeased by the issuance of General Obligation
Refunding Bonds (Series Police Station Project) on November 23, 2021 and property
taxes are to be raised for the principal and interest payments of the indebtedness
through tax levy; and
WHEREAS, in the general municipal election held on April 11, 2006, City of
Arcadia voters approved the issuance of General Obligation Bonds Series 2011 in the
principal of $8 million for the construction of a grade separation, which is located at
the intersection of Santa Anita Avenue and the Foothill Extension of the Metropolitan
Transit Authority Gold Line; the 2011 Bonds were defeased by the issuance of
General Obligation Refunding Bonds (Series Bond Measure A) on November 23, 2021
and property taxes are to be raised for the principal and interest payments of the
indebtedness through tax levy.
1
RESOLUTION NO. 7646
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARCADIA,
CALIFORNIA, DETERMINING THE AMOUNT OF REVENUE TO BE RAISED
FROM PROPERTY TAXES FOR FISCAL YEAR 2025-26 TO PAY FOR THE
DEBT SERVICE ON THE 2021 GENERAL OBLIGATION REFUNDING BONDS
(SERIES BOND MEASURE A AND SERIES POLICE STATION PROJECT)
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA,
DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS.
SECTION 1. The following is the amount of revenue necessary during Fiscal
Year 2025-26 to pay for the authorized debt service on the above-described Bonds:
Series 2021 General Obligation Refunding Bonds
(Series Measure A): $488,700
Series 2021 General Obligation Refunding Bonds
(Series Police Station): $353,600
SECTION 2. The City Clerk shall certify to the adoption of this Resolution.
Passed, approved and adopted this 19th day of August, 2025.
ATTEST:
City Clerk
APPROVED AS TO FORM:
MicKael J. Maurer
City Attorney
Mayor of the City of Arcadia
2
Exhibit “A”
Calculation of Tax Rate
General
Obligation
Bonds
Balance
Available
(1)
7-01-25
2025-26
Assessed
Valuations
Estimated
Tax
Revenue
Debt
Service
(2)
% Tax Rates
2025-26 (3)
2021 Series
Measure A $544,600 $22,301,074,109 $488,700 $523,500 0.002191%
2021 Series
Police Station $454,500 $22,301,074,109 $353,600 $409,100 0.001586%
(1)Excess fund balance is included to ensure that positive cash balance is available
for the debt service payments on August 1, 2026.
(2)Per debt service schedule below.
(3)For comparison, the levy rate from last year was 0.002204% and 0.001549% for
Series 2021 General Obligation Refunding Bonds (Series Bond Measure A and
Series Police Station Project), and their first-year levy rates were 0.006621% and
0.009657% in 2011 and 2001, respectively.
DEBT SERVICE PAYMENT SCHEDULE:
2021 G.O. Bond
Series Measure A
2021 G.O. Bond
Series Police
Station
Principal $488,000 $381,000
Interest $35,500 $28,100
Total $523,500 $409,100