City Council Agenda and Packet 2021 06 17 SP

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SUBJECT: POTENTIAL BALLOT TRANSPORTATION TAX DISCUSSION DATE: JUNE 17, 2021 PAGE6OF8 $1.5 million annually raises approximately $20 million over 30 years as projected in the May 4, City Council packet regarding debt financing scenarios for potential transportation projects (link below). Long term projections for fund balances will be provided at the July 23 budget retreat as part of the long term financial plan. Additionally, the Louisville Revitalization Commission (LRC) is discussing whether to contribute an annual amount toward the debt for construction of those underpasses within the urban renewal area to eliminate blight and support economic vitality in that corridor. The LRC meeting is on June 16 and staff will provide an update on the 17th. A link to the LRC packet with long-term financial projections is below for reference. Direction Required #2 — based on the cost estimates and which underpasses will move forward for funding consideration, as well as the City finances, staff is seeking direction as to whether to proceed with a future ballot tax question that requests an additional property tax increase to cover a gap in financing for the underpasses beyond the City and LRC contributions (consistent with previous direction on May 4) and the total amount requested. Should this not be the case based on direction provided in #1, discussion can focus on alternative financing scenarios and ballot language. Information was also provided at the April 13, 2021 City Council meeting regarding potential property tax generation, and examples of how an increase would impact City property tax revenue and City property tax payers (see linked packet information). Please see the link to the May 4 packet materials on possible ballot language for a transportation tax. Per the discussion on May 4 the preferred direction for possible ballot language is the following: Limited Tax General Obligation Bond with a Sales and Use Tax Pledge SHALL CITY OF LOUISVILLE DEBT BE INCREASED $50,000,000, WITH A REPAYMENT COST OF UP TO $[ ]; AND SHALL CITY PROPERTY TAXES BE INCREASED UP TO $[ ] ANNUALLY, OR BY SUCH LESSER AMOUNT AS MAY BE NECESSARY TO PAY SUCH DEBT FROM AN ADDITIONAL AD VALOREM PROPERTY TAX MILL LEVY NOT TO EXCEED [ ] MILLS SUBJECT TO THE FOLLOWING CONDITIONS: (1) SUCH DEBT AND TAXES SHALL BE USED FOR THE PURPOSE OF FINANCING THE ACQUISITION AND CONSTRUCTION OF TRANSPORTATION IMPROVEMENTS INCLUDING BUT NOT LIMITED TO. ...[DETERMINE HOW DETAILED THE CITY WOULD LIKE TO BE IN THE DESCRIPTION OF THE IMPROVEMENTS] OR TO REFUND SUCH DEBT AT A HIGHER OR LOWER INTEREST RATE (OR TO CREATE A RESERVE FOR SUCH PURPOSES); (2) SUCH DEBT SHALL BE A LIMITED TAX GENERAL OBLIGATION OF THE CITY, MAY BE EVIDENCED BY BONDS, NOTES, CONTRACTS OR LOAN AGREEMENTS AND SHALL BE PAYABLE FROM A PROPERTY TAX MILL LEVY CITY COUNCIL COMMUNICATION 7