NORTH PORT – The City Commission unanimously approved two ordinances Tuesday that will help provide important information to North Port voters as they decide whether to change the way the city borrows money for projects not funded by property taxes.
One vote established a debt management policy and the second established a five-member Debt Management Advisory Committee, made up of five residents with a background in capital projects, financing or government operations.
Both items were approved during a session that was technically the Oct. 8 meeting, postponed by Hurricane Milton.
The second reading of both ordinances will take place at a special meeting at 9 a.m. on Nov. 4.
What does the referendum require on a charter change?
The referendum on the Nov. 5 ballot asks voters to amend the city charter to allow the commission to issue debt to respond to emergencies or pay for certain safety and public health projects.
While state law limits ballot language to just 75 words, the debt policy provides detailed guidance on how the city can use debt to pay for needed infrastructure or emergency repairs.
Where can you find the debt management policy?
The current draft debt management policy can be viewed online at NorthPortFL.gov/Referendum.
The website contains information about the city rights treaty and unfunded infrastructure needs, as well as a list of frequently asked questions.
The proposed policy was modeled after that of other municipalities and the best practices of the Government Finance Officers Association, with input from the city’s independent financial advisor.
Why does North Port need to change the way it borrows money?
North Port is the only city among Florida’s 411 whose charter prohibits borrowing money or taking on debt without voter approval, according to research by city staff and outside consultants.
Every other city and county in Florida routinely relies on borrowing – in the form of bonds, loans, leases or other lending instruments – to pay for growth and infrastructure needs and to keep their communities running. In North Port, these projects may include roads, bridges, water management structures or water/wastewater infrastructure.
The charter amendment would allow North Port to issue debt payable from funds other than property taxes without voter approval, in response to declared emergencies or for safety and public health projects of $15 million or less per project.
The emergency lending authority — which would have allowed the city to obtain short-term loans with low or no interest after Hurricane Ian — has been less controversial than the change that would allow the city to borrow without approval for major projects that do not. for property tax reimbursement.
Which type of bonds will not be affected by the proposed amendment to the articles of association?
The proposed statute change will apply only to revenue bonds repaid by specific revenue funds, and not to property taxes.
Any borrowing or incurring of debt would have to be approved by a majority of the city commission in at least two public hearings.
General obligation bonds — bonds that are paid back with property taxes — would still have to be approved on an individual basis by a voter referendum in a general election. That’s actually a state requirement.
General obligation bonds are typically used to pay for large-scale infrastructure projects, such as a police station.
This article originally appeared on Sarasota Herald-Tribune: Ordinances related to Nov. 5 North Port loan pass for first reading
