MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Information on the Process and Potential Schedule for Calling a Bond Referendum on November 4, 2003
DATE: June 23, 2003
This memorandum provides information on the process and a potential schedule for the Council’s consideration to call a bond referendum on November 4, 2003 (the date of this fall’s General Election), to consider issuing General Obligation bonds for green infrastructure capital improvements and an expansion of the Chapel Hill Public Library.
The memorandum also provides a brief discussion on the potential appointment of a special bond committee of Town citizens to provide information about the capital projects under consideration and to promote passage of General Obligation bonds to finance the proposed projects.
BACKGROUND
One June 9, 2003, the Council considered options for financing several proposed capital improvements projects including the proposed Town Operations Center, green infrastructure projects and expansion of the Chapel Hill Public Library. A copy of the agenda item and illustrative summary tables on these issues from the Council’s meeting on June 9 are provided as background information.
At that meeting, the Council adopted resolutions stating its desire to finance the proposed Town Operations Center using Certificates of Participation and using General Obligation bonds to finance the proposed green infrastructure projects and Library expansion. The resolutions authorized the Manager to begin the steps necessary to call a bond referendum on November 4, 2003 for voter consideration of General Obligation bonds to finance the proposed green infrastructure projects and Library expansion.
Information on a process and potential schedule for completing the steps necessary to call a bond referendum is presented below.
DISCUSSION
Process and Steps Required to Call a Bond Referendum
Calling a referendum to consider issuance of General Obligation bonds to finance capital projects requires a process and steps that must be approved by the Local Government Commission.
In order for the Council to call a referendum on November 4, 2003, the formal process would need to begin in early August with the publication of a notice of the Town’s intent to file an application to the Local Government Commission for the issuance of General Obligation bonds subject to approval by voters in a referendum. The application must be filed with the Commission before August 25, 2003. The first step for Council action would need to be considered at the Council’s meeting on August 25, 2003. Below are the formal steps and a recommended schedule for completing the authorization process for a referendum.
Date Step
August 25 Introduction of Bond Orders for proposed projects with preliminary maximum amounts for consideration, authorization to file application with Commission, file sworn statement of debt with Town Clerk and call public hearing to consider adoption of Bond Orders.
August 26 Publish Bond Orders and Notice of Public Hearing on Orders.
September 8 Council holds public hearing on Bond Orders, considers adoption of Bond Orders specifying final amounts for proposed projects and considers adopting a resolution calling for referendum on November 4, 2003
After September 8
and before
September 10 Publish Adopted Bond Orders and Notice of Referendum twice, first publication not less than 14 days and second publication not less than 7 days before last day on which unregistered voters may register for referendum.
November 4 Hold Referendum
Based on the process and steps required leading to a referendum, we recommend the Council proceed in accord with the steps and schedule outlined above. We believe it would be necessary to introduce the Bond Orders on August 25 and, after a public hearing, adopt the Bond Orders on September 8 in order to allow sufficient time for the required publication of the Bond Orders and notice of the referendum at least 14 days before the last day unregistered voters may register for the referendum and General Election.
In order to start the process, however, the Council would need to decide on the preliminary amounts to be included in the Bond Orders that would be introduced on August 25. Before that time, the staff would work with bond counsel to determine the preliminary amounts and specific category and number of Bond Orders needed for the projects under considerations, and the specific wording of Bond Ballots questions.
When introducing the Bond Orders on the 25th, the Council must specify the maximum amount it wishes to consider for the various projects. In accord with State law, the amounts of the proposed Bond Orders considered at the public hearing on September 8 could be lowered after the public hearing, but could not be increased without starting the process again.
At the meeting on August 25, the Bond Orders would be introduced and the Council would call the public hearing to consider the Bond Orders on September 8. Immediately following the public hearing, the Council would need to make final decisions on the amounts to be included in the Bond Orders for each proposed project, and adopt the Bond Orders. As noted above, the Bond Orders could be reduced after discussion, but could not be increased.
Upon adoption of the Bond Orders, the Bond Orders and Notice of the Referendum would be published not less than 14 days before the last day that any unregistered voter may register for the referendum and General Election.
Use of Citizen Bond Committee
In accord with State law, the Town staff may not advocate or encourage the passage of bond authorization in the referendum or use Town funds to promote efforts to encourage passage of the bonds. The staff role would be limited to such tasks as providing information on the projects under consideration, and providing estimates for the construction costs for the projects and the estimated annual debt service payments that would be associated with each project.
In past years, the Council has elected to use a committee of citizens who would organize themselves to provide information to the public about the needs for any of the projects proposed for consideration, and the estimated costs of the projects and related annual debt service costs. In addition to providing information, such a committee would be able to promote the projects and to encourage voters to support the projects by voting “yes” on the question of approval of General Obligation bonds to finance proposed projects.
We recommended that the Council begin the process of selecting such a Committee immediately so that the Committee would have ample time over the next few months to organize themselves and raise whatever funds it would need to promote a bond campaign during the fall leading up to the proposed referendum on November 4, 2003.
RECOMMENDATION
In order to begin the process necessary to call a bond referendum on November 4, 2003 to consider General Obligation bonds to finance various capital improvements, we recommend that the Council follow the schedule discussed above. In addition, as in past years, we recommend the Council consider the use of a citizens’ committee to provide information to the public about proposed projects and associated costs.
We stand ready to assist the Council in beginning this process and to provide information to citizens and to a citizens’ committee on any project that the Council wishes to consider financing with General Obligation bonds.
A RESOLUTION ESTABLISHING A SCHEDULE FOR CONSIDERATION OF A BOND REFEREDUM ON NOVEMBER 4, 2003 (2003-06-23/R-21)
WHEREAS, the Town Council has considered various capital improvements projects and wishes to finance these projects using General Obligation bonds; and,
WHEREAS, the use of General Obligation bonds for financing capital improvement projects requires approval by the voters in a referendum;
NOW, THEREFORE, BE IT RESOLVED by the Town of Chapel Hill that the Council hereby adopts the following schedule for calling a bond referendum on November 4, 2003 for voters to consider financing various capital improvements projects with General Obligation bonds:
Date Step
August 25 Introduction of Bond Orders for proposed projects with preliminary maximum amounts for consideration, authorization to file application with Commission, file sworn statement of debt with Town Clerk and call public hearing to consider adoption of Bond Orders.
August 26 Publish Bond Orders and Notice of Public Hearing on Orders.
September 8 Council holds public hearing on Bond Orders, considers adoption of Bond Orders specifying final amounts for proposed projects and considers adopting a resolution calling for referendum on November 4, 2003
After September 8
and before
September 10 Publish Adopted Bond Orders and Notice of Referendum twice, first publication not less than 14 days and second publication not less than 7 days before last day on which unregistered voters may register for referendum.
November 4 Hold Referendum
This the 23rd day of June, 2003.