TO: Honorable Mayor & Members of the North Port Commission
FROM: A. Jerome Fletcher II, ICMA-CM, MPA, City Manager
TITLE: Discussion and Possible Action Regarding Charter Amendment Language Related to the City’s Bonding Authority.
Recommended Action
Discussion and possible action regarding charter amendment language related to the City’s bonding authority.
Background Information
The following provides a timeline of Commission actions taken to date:
Ø April 23, 2024, Commission Special Meeting, the City’s Bond Counsel and Financial Advisor participated in the discussion on proposed charter options as requested. Based on information available at the time, staff provided recommendations for Charter amendment language, including a proposed cap within the referendum language. Commission approved a motion to:
• Direct the City Manager to work with staff to bring back language for a charter amendment to allow the City borrowing authority in time for the November election.
Ø March 26, 2024, Commission Regular Meeting, Commission approved a motion to:
• Direct the City Manager to work with staff to meet with bond counsel and other external subject matter experts in order to have discussion with possible action on how to structure the payment of the Police Department Headquarters.
Ø February 26, 2024, Commission Workshop, Commission provided consensus to:
• Direct staff to review permissive referendums and/or send to the Charter Review Advisory Board for review, with legal review being provided to Commission.
• Direct staff to look into the possibility of an August referendum.
• Direct staff to update the draft language to include who is giving the authority to issue permissible debt.
Ø December 4, 2023, Commission Workshop, Commission provided consensus to:
• Direct the City Attorney and City Manager to come back with a proposed Charter amendment based on Option 1 with consideration of some caps for Commission review.
Staff conducted additional research on debt management best practices and referendum language development; consulted with the City’s Bond Counsel and Financial Advisor, and reviewed comparisons to other Florida municipalities and counties. Based upon staff’s findings, it is recommended removing reference to a borrowing limit within the referendum wording and to set the limit administratively via a debt management policy.
The adoption of this policy will allow the Commission the ability to establish debt limits specific to North Port’s needs based on credit rating metrics and debt affordability measures.
Draft proposed ballot language with removal of the cap is as follows:
In Florida, local governments can issue certain debt for various governmental purposes; however, the City Charter requires voter approval before issuing any debt. Do you approve amending the Charter to allow the City Commission to issue debt without prior voter approval: (i) to respond to a declared emergency or disaster, such as a hurricane; and (ii) for safety and public health projects, such as for emergency and essential services, roads, bridges, and sanitation?
The City has obtained an engagement letter from an independent certified financial advisor, PFM, to assist with the development of a debt management plan which will be brought to the City Commission for review, input, and approval.
Also, proposed referendum language will be brought to the City Commission via ordinance for approval, with the final approved language required to be submitted to the Supervisor of Elections by August 6, 2024, for inclusion on the November 5, 2024, general election ballot.
While the proposed amendment to the Charter will allow the City to issue debt without a referendum, the issuance of debt will require a minimum of two publicly noticed meetings to allow City Commission evaluation and community input.
Strategic Plan
Good Governance
Financial Impact
To be determined.
Procurement
Not applicable.
Attachments:
1. Presentation
2. Debt Management Plan Examples
3. Debt Issuance Authority
Prepared by: A. Jerome Fletcher, II, ICMA-CM, MPA, City Manager
Department Director: A. Jerome Fletcher, II, ICMA-CM, MPA, City Manager