REPORT TO COUNCIL
SUBJECT
Title
Resolution Authorizing an Ad Valorem Tax Levy Based on a Debt Service Estimate to be Provided to Santa Clara County Respecting Unsold General Obligation Bonds for Fiscal Year 2025/26
Report
COUNCIL PILLAR
Manage Strategically Our Workforce Capacity and Resources
BACKGROUND
Measure I, which was passed by more than two-thirds of the City of Santa Clara's (the "City") voters at the November 5, 2024, General Election, authorizes the issuance by the City of general obligation bonds in the total principal amount of $400 Million (the "Bonds") for the purpose of providing funds for the municipal capital improvements listed in the bond expenditure plan (Attachment 2) approved by the City Council. The first series of Bonds is expected to be issued in late 2025 or early 2026, which will require a property tax to be placed on the Fiscal Year 2025/26 Santa Clara County (the "County") property tax roll to provide for debt service payments of any principal or interest coming due on the Bonds in 2026.
DISCUSSION
California law permits the City to levy property taxes in advance of an anticipated bond issuance based on the estimated debt service requirements for the bonds by providing an adopted a resolution, including a tax rate and bond principal amount, to various County officials prior to the August deadline for finalizing the property tax assessments. City staff, working with the City's municipal advisor, PFM Financial Advisors, has estimated the principal amount of the first series Bonds as $150 Million, and the per-parcel tax rate as $28.70 per $100,000 (0.0287%) of assessed value, to be assessed on all property owners. The attached resolution (Attachment 1) includes these figures and authorizes City staff to provide the resolution and any related information to the appropriate County officials.
The City Council had several questions regarding the Bonds issuance from the May 27, 2025 General Obligation Bonds Study Session. Responses...
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