Tax and Financial Information

The $600 million of expenditures for Urban Rail would be funded by general obligation bonds, which are secured by property taxes. The $400 million for roadway improvement projects would also be funded by bonds or other debt instruments available to the City.

Based upon market conditions as of the date of adoption of Ordinance No. 20140807-017 on August 7, 2014, and using taxable assessed values for the 2013 tax year (2013-14 fiscal year), without adjustment for anticipated growth in the taxable assessed value in future years, if the bonds and notes are authorized, the estimated total tax rate of the City is expected to be approximately $0.6277 per $100 of taxable assessed value (which represents an increase of $0.1250 per $100 of taxable assessed valuation as compared to the City’s total tax rate as of the date of  adoption of Ordinance No. 20140807-017 on August 7, 2014), based on current State law, which is subject to change. As reported in the 2014 Austin Strategic Mobility Plan, applying the assumptions used in the General Obligation Bond Capacity Analysis dated April 29, 2014, which includes forecasted growth in taxable assessed values, City financial staff has determined that if the bonds and notes are issued, the City’s total tax rate would increase by $0.0625 per $100 of taxable assessed valuation (as compared to the City’s total tax rate as of the date of adoption of Ordinance No. 20140807-017 on August 7, 2014). The foregoing estimates include the impact of any debt incurred for the roadway improvement projects.

If approved by voters, the bonds and notes will be secured by an ad valorem tax that is sufficient, within limits prescribed by law, to pay the principal of and interest on the bonds and notes and to provide a sinking fund to pay the bonds and notes. Actual tax rates, interest rates, maturity dates, aggregate outstanding indebtedness and interest on such debt, will only be established and known at the time that bonds and notes are issued. In addition, actual tax rates will depend upon, among other factors, the assessed valuation of taxable property, prevailing interest rates, the market for the City’s bonds and notes and general market condition at the time that bonds and notes are issued.

The City’s ad valorem debt service tax rate as of the date of adoption of Ordinance No. 20140807-017 on August 7, 2014, is $0.1171 per $100 of taxable property. As reported in the 2014 Austin Strategic Mobility Plan, applying the assumptions used in the General Obligation Bond Capacity Analysis dated April 29, 2014, a tax increase of 6.25 cents spread out over five years would support repayment of the bonds and notes, if approved and issued, resulting in a projected estimated tax bill increase of $217 in 2020 on a home currently valued at $200,000.