Title
Consider a resolution approving a resolution by the Board of Directors of the Brushy Creek Regional Utility Authority, Inc. Authorizing the issuance of "Brushy Creek Regional Utility Authority, Inc. City of Round Rock, Texas Contract Revenue Bonds, (Brushy Creek Regional Water Treatment and Distribution Project), Series 2023"; Establishing the procedures for selling and delivering the bonds and resolving other matters incident and relating to the issuance, payment, security, sale and delivery of such bonds.
Body
The first $41,750,000 phase of the $90.45 million total debt package for the City's BCRUA projects was priced and sold by the Texas Water Development Board (TWDB) on October 12, 2023. The true interest cost for this issue is 3.71%, a cash flow savings of $6.7 million, and present value savings of $4.2 million over a standard open market sale.
The issuance documents were approved by the City Council and the BCRUA in August 2023 and the official application submission was approved by both entities in April 2023.
This final step requires both the City and the BCRUA to approve the final package. The BCRUA is scheduled to approve the package at its October 25, 2023 meeting. Proceeds from the bond sale will be received in November 2023.
Staff recommends approval of this action.
Background
The City of Round Rock is a participating and founding member of the Brushy Creek Regional Utility Authority, Inc, (BCRUA) along with the Cities of Cedar Park and Leander. The City previously requested the BCRUA to approve and execute a financing agreement with the Texas Water Development Board (TWDB) for funding through the State Water Implementation Fund for Texas (SWIFT) to finance the City’s cost participation in Phase 1D and Phase 2 construction costs.
The BCRUA has two large projects underway. The City of Round Rock’s share of those costs is $90.45 million to be financed.
• The Phase 2 Deep Water Intake project is a permanent raw water intake on Lake Travis which will replace the floating intake that was constructed with Phase 1. The project is scheduled to be completed in 2027. The deepwater intake will have an ultimate capacity of 144.7 million gallons per day (MGD) and will provide a reliable supply of water through the full buildout of BCRUA.
• The Phase 1D water treatment plant expansion will increase capacity at the plant from 32.5 mgd to 42 mgd. This project is scheduled to be completed in late 2024.
The Texas Water Development Board (TWDB) formally approved the full loan for Phase 1D and Phase 2 construction on July 25th. The bonds will be issued in three phases on behalf of Round Rock.
November 2023 $41,750,000 (current action under consideration)
November 2024 $31,500,000
November 2026 $17,200,000
Total $90,450,000
Using the TWDB SWIFT discounted interest program to finance these improvements will reduce the City’s interest cost by 18% which will result in an estimated present value savings of $8.3 million on the total loan.