2010 City of Crandall Bond Election

Frequently Asked Questions

GENERAL QUESTIONS

WHAT ARE MUNICIPAL BONDS?
• Bonds are a City’s way of borrowing money, just as a homeowner might borrow money to remodel a kitchen or add a bathroom.
• Cities sell bonds to raise money for capital improvement projects like libraries, fire stations, recreation centers, bridges, erosion projects, street projects, and drainage projects, etc.
• Typically, bonds are not used for equipment or personnel, such as buying fire trucks or hiring extra police officers.
• Bond items usually have a life of more than 10 years.
• Bonds must be used for the purpose specified.

WHY DID THE CITY OF CRANDALL DECIDE TO HOLD A BOND ELECTION?
• The City of Crandall has two critical needs to address and does not have the funds to pay for them. The City could also issue certificates of obligation to fund these improvements and the process would be much faster, but holding a bond election and issuing bonds provides the citizens with the power to choose whether or not they want the City to borrow money for these purposes.
• The citizens do have some say with regard to certificates of obligation, but they have to submit a petition and go through a process. With a bond election, they can voice their opinion more easily by just voting.

IS THE TIMING REALLY RIGHT FOR A BOND ELECTION? WHY NOW?
• Presently, the construction business is slow, which means bids should be very competitive.
• Interest rates are historically low, allowing Crandall to borrow money at the lowest cost.
• Projects are expected to generate construction-related jobs in Crandall during high unemployment.
• Road reconstruction will reduce the maintenance costs of today’s roads.
• When the economy rebounds, having the roadway improvements and the new police station in place may create a safer environment and encourage new development, especially downtown. Waiting until the economy improves to fund these projects could greatly delay these opportunities.

WHY WEREN’T PARKS AND RECREATION PROJECTS, HIKE AND BIKE TRAILS, DOWNTOWN IMPROVEMENTS, SPORTS FACILITIES, WATER AND SEWAGE TREATMENT FACILITIES OFFERED AS BOND PROPOSALS?
• Public Input through surveys conducted earlier this year identified roadway improvements as the most pressing needs in Crandall.
• The City wants to keep any tax increase to a minimum, so residents pay the least amount needed to address the problems residents identified as important in surveys conducted earlier this year.
• Many of the projects listed above are in the planning stage and are not ready to be included in a bond proposal.

WHAT ARE THE DIFFERENT TYPES OF BONDS?
• REVENUE BONDS These bonds are used for funding permanent capital improvements for an enterprise fund such as water and wastewater. Repayment of these bonds is from the revenues of the enterprise fund.
• CERTIFICATE OF OBLIGATION (CO) This is a written promise secured by the full faith and credit of the City. Used for funding permanent capital improvements. Debt Service is paid from property taxes or system revenues.
• GENERAL OBLIGATION BONDS (GO) These bonds are used for funding permanent public capital improvements such as buildings, streets, and bridges. The repayment of these bonds is made from the levy of property tax. Voter approval is required to issue these bonds.
WHAT KIND OF BONDS IS CRANDALL PROPOSING?
• GENERAL OBLIGATION BONDS (GO) A new police station and road reconstruction are permanent public capital improvements. These items are important to residents of Crandall, as determined in a recent survey. Because the repayment of these bonds is from the levy of property tax, the city wants to let the citizens vote and determine the outcomes. Voter approval is required to issue GO bonds, and that’s why the city chose that route.

FINANCING QUESTIONS

WHAT TAX INCREASE WOULD BE NEEDED TO FINANCE THE BONDS?
• Crandall’s current proposed tax rate is 74-1/2 cents per $100 in property evaluation.
• Proposition 1 – for a new Police Station would increase taxes $9.17 a month for the average-priced home of $124,219.
• Proposition 2 – for Roadway Improvements would increase taxes $11.45 a month for the average-priced home of $124,219.
• Together, the two propositions would increase Crandall’s currently proposed rate of $0.7457 to 94-1/2 cents per $100 evaluation. An average-priced home of $124,219 would have a tax increase of $.68 a day.

WHAT IS THE TERM OF THE BONDS? WHEN WILL THE BOND TAX INCREASE END?
• The term of the bonds will be about 20 years, but the bond propositions being submitted to the voters authorize a term of up to 40 years. The actual term of the bonds will depend somewhat on the population growth of Crandall. This does not mean that after that time, your taxes will automatically decrease. Whether the tax amount is continued or ended will be determined by the City Council based on financial and economic factors at that time.

ARE THERE ADDITIONAL FUNDING SOURCES FOR THE PROPOSED PROJECTS?
• Yes, the City of Crandall has requested and received a $750,000 grant from the North Central Texas Council of Governments for the improvements to First Street, reducing the cost of that project to taxpayers by 77%.

DOES THE BOND PROGRAM INCLUDE MONEY FOR EQUIPMENT OR EMPLOYEE SALARIES?
• No, the bond proposals do not cover equipment or personnel.

PROPOSAL 1: $1.5 million
New Police Station

WHY DO WE NEED A NEW POLICE STATION?
WHY ISN’T THE CURRENT STATION ADEQUATE?
• The current facility inefficiently crowds 13 officers into 900 square feet.
• There is no storage space, no temporary detention provision, no evidence/property processing area.
• The current building and areas within the building have an insufficient level of security.
• The current facility has signs of roof leakage, which can mean problems including mold, damage to records, and the compromising of evidence.
• A new building will allow the City to comply with the federal Energy Code, handicapped accessibility, building codes, evidence integrity needs, building security and emergency power generation.
• The new facility will have a training room that will be used for in-service training and can be used for community-oriented crime prevention programs such as the Citizens Police Academy, Teen/Youth Academy, Neighborhood Watch, etc.
• The current police station is a total of 900 sq ft. for 13 officers.

DOES THE POLICE STATION PROPOSAL INCLUDE THE COST OF THE LAND?
• No, the City of Crandall already owns the land on which the new police station would be built.

WILL THE NEW POLICE STATION BE ADEQUATE FOR CRANDALL GROWTH, THROUGH HEARTLAND OR OTHERWISE?
• The new facility is designed to accommodate up to 30 officers and has room for expansion when needed.
WHY NOT WAIT UNTIL HEARTLAND ANNEXATION TAKES PLACE SO THAT CRANDALL CAN DETERMINE IF MUNICPAL OFFICES SHOULD MOVE NORTH OF HIGHWAY 175 TO BE IN THE NEW CENTER OF CRANDALL’S POPULATION?
• If annexed, Heartland already has a provision for a police substation located there.
• Annexation may not take place until 2015 or after.
• A downtown location for the Police Department is part of the City’s Plan to make downtown the “central heart” of the City,
• A new downtown Police Headquarters would increase police visibility and perception of safety in the downtown area.

WHY NOT INCLUDE THE COST OF A HOLDING/DETENTION FACILITY IN THE POLICE STATION NOW INSTEAD OF IN THE FUTURE?
• The current detention process should be effective for the near future, so the $1 million cost of a temporary holding facility cannot be justified at this time.

HOW WILL THE NEW POLICE STATION AFFECT CRIME AND GENERAL SAFETY IN CRANDALL?
• The facility will provide new resources for officers to process evidence and to conduct interviews and investigations.
• The building will provide visible police presence, which increase police visibility and perception of safety in the downtown area.
• The building will provide facilities for community anti-crime programs.

WHAT WOULD THE EFFECT OF NOT HAVING A NEW POLICE FACILITY BE ON CRANDALL?
• It will be difficult for the Police Department to expand services.
• It will be difficult to meet the increased needs of a growing city.
• With improper storage, security, and temporary detention, the City could be exposed to risk and open to lawsuits.

WHEN WOULD THE POLICE STATION GROUNDBREAKING TAKE PLACE AND WHEN WOULD THE FACILITY BE OPERATIONAL?
• The groundbreaking would take place in 2011 and the station would become operational in 2012.

PROPOSITION 2: $2 million
Roadway Improvements

HOW WERE THE STREET REPAIR PROJECTS IN THE PROPOSED BOND PROGRAM SELECTED?
• The City contracted with Fugro Consultants to assess existing roadways. Based on pavement condition, they classified roads as Good, Fair, Marginal, Poor and Very Poor.
• All roads within the downtown network area rated Poor and Very Poor were included (approx. 6.6 miles total.)
• Repair of a collapsed inlet and drainage pipe in the Buffalo Creek Subdivision was considered essential by city staff and council.

HOW LONG WILL THE ROADWAY IMPROVEMENTS LAST?
• Sidewalks on First Street are expected to have an effective life of about 20-50 years.
• The Buffalo Creek inlet and road repairs are expected to have an effective life of about 30 years.
• The asphalt roadway improvements, with regular maintenance, are expected to have an effective life of about 7 to 10 years, with consistent maintenance and sealing of cracks.

WILL THE ROADWAY IMPROVEMENTS HELP ALLEVIATE MORNING CONGESTION CAUSED BY WORK AND SCHOOL TRAFFIC?
• Yes, this will improve the flow of traffic by opening up roads that are virtually non-drivable now, spreading traffic over more roadways.

IF THE ROADWAY PROPOSAL PASSES, WHEN WILL ACTUAL ROAD CONSTRUCTION BEGIN AND END?
• The plan is to disburse the bond funds in Spring 2011, begin construction in Summer 2011, and complete improvements by Spring 2012.

WHAT IMPROVEMENTS WILL BE MADE TO ROADS IN BUFFALO CREEK?
• Due to the extensive cost of concrete roadway repairs, only Buffalo Creek road sections rated “Very Poor“ will be repaired with bond funds. The “Very Poor“ areas of Buffalo Creek totaled about 0.3 tenths of a mile while “Poor” sections totaled 1.1 miles. One mile of asphalt roadway reconstruction costs approximately $180,000, compared to $800,000 for one mile of concrete roadway reconstruction. Repairing that 1.1 miles of roadway, would require an additional $900,000 to Proposition 2.