Consider/Discuss/Act on All Matters Incident and Related to the Issuance and Sale of “City of McKinney, Texas, Waterworks and Sewer System Revenue Refunding and Improvement Bonds, Series 2026”, Including the Adoption of an Ordinance Authorizing the Issuance of Such Bonds, Establishing Parameters for the Sale of Such Bonds and Delegating Certain Matters to an Authorized City Official(s) of the City

This ordinance authorizes the City of McKinney to issue "Waterworks and Sewer System Revenue Refunding and Improvement Bonds, Series 2026" to fund improvements and extensions to the city's Waterworks and Sewer System and to refund existing debt. The City Council has delegated authority to a Pricing Officer (City Manager, Chief Financial Officer, or Director of Financial Services) to finalize the bond sale details within specific parameters, as authorized by Texas Government Code, Chapters 1207 and 1371.

Key Provisions & Financial Details:

• New Money: Up to $28,000,000 (with $25,000,000 planned) will finance water and wastewater infrastructure projects. Examples include University Pump Station Improvements, Redbud Pump Station – Ground Storage Tank No 2, Couch Drive WW Capacity Improvements, Comegys Creek WW Improvements, and Florence St & North St Infrastructure Improvements. The maximum maturity for new money bonds is March 15, 2046.
• Refunding: Up to $8,000,000 (with $7.72 million planned) will refund a portion of the "City of McKinney, Texas, Waterworks and Sewer System Revenue Refunding and Improvement Bonds, Series 2016". This refunding aims for at least 3.00% present value debt service savings (estimated at over $387 thousand / 4.66%). The maximum maturity for refunding bonds is March 15, 2036.
• The maximum true interest cost for the bonds shall not exceed 5.00%.

Funding Mechanism & Security:
These bonds are special obligations of the City, payable solely from the Net Revenues of the Waterworks and Sewer System, constituting a first lien pledge as per Texas Government Code, Chapter 1208. They are not secured by or payable from taxation. The City commits to maintaining rates and charges sufficient to cover operating expenses and debt service.

Bond Ratings & Timeline:
The City's Water Sewer Revenue Bonds currently hold strong ratings: AA+ (Stable Outlook) from Standard & Poor’s and Aa1 from Moody’s. The issuance timeline includes Council Action on parameters on March 17, rating calls on April 16, ratings received by April 27, competitive bond sales on May 19, and closing by June 17.