Council approves sale of municipal bonds for roads funding

The City of Turlock will soon have $25 million in municipal bond sales to help fund its road rehabilitation program that will see 15 designated roadways improved in the next several years (Journal file photo).

At its most recent meeting, the Turlock City Council — acting also as the Public Financing Authority — took steps to secure $25 million for its road rehabilitation program.

The money will come through the sale of municipal bonds and is slated to be paid back over a 15-year period.

The council voted unanimously to approve a series of financing documents — site lease, lease agreement, indenture of trust, assignment agreement, and bond purchase agreement — and to put the finishing touches on the financing team.

"Obviously, the roads program is very, very important to council and the community,” said Eric Scriven of NHA Advisors, part of the financial advisory group hired by the city. “We believe that a public offering is going to be the most cost-effective approach for funding this.”

Up next is preparation of a prospectus for investors. Following that, the bonds will go through a credit rating process, then, sometime in late summer, the interest rates will be locked, and the transaction will close in September, when funds will be made available to the city.

Money from the city’s Measure A coffers will be used to make the $2.5 million yearly payments on the bonds. Measure A was a 2020 ballot measure that voters approved to add a three-quarter-cent sales tax that goes toward general city services.

“The credit of the transaction is a general fund pledge,” said Scriven. “Of course, the city and your finance director are underwriting it from the city’s point of view based on Measure A. That’s how we’re all looking at it. But it is a general fund pledge.”

Once the bond money becomes available, the city has a list of prioritized projects.

“Maybe we need to publish the three years of roads (projects) that we’ve already got set up so people understand that we’re ready,” said Mayor Amy Bublak. “We are not going to say, ‘OK, we’ve got money, now what do we do?’ We’ve already voted for it. We’re ready to fix those, and way more.”

The road projects will be done in phases, according to city financial director Isaac Moreno.

“We’re looking at about four to five tranches, over about 10 years,” Moreno said.

Milt Trierweiler, a Measure A proponent, praised the council for thinking outside the box to come up with a solution for fixing the city’s roads.

“We’ve been waiting for this for a long time and you’ve come up with something that looks very good,” Trierweiler told the council.

In February 2022, the City of Turlock approved a professional services agreement with a consultant for the design of the pavement rehabilitation of 15 streets within the City of Turlock. The design of these 15 streets will also include traffic striping, coordination with utility companies, and handicap access upgrades, specifically, the construction of accessible curb ramps when adjacent to a prepared surface for pedestrian use.

Those 15 road projects include:

· 20th Century Boulevard, east of Golden State to Geer Road

· Carrigan Street, from N. Johnson Road to N. Quincy Road

· Corrello Street, from Sierra Vista Drive to Marlee Drive

· Delbon Avenue, from N. Olive Avenue to Colorado Avenue

· East Avenue, from Golden State Boulevard to Daubenberger Road (except for the county island)

· Flower Street, from N. Soderquist Road to N. First Street

· Fosberg Road, from E. Monte Vista Avenue to E. Christoffersen Parkway

· Julian Street, from N. Soderquist Road to N. First Street

· Locust Street, from Vermont Avenue to W. Main Street

· Mira Flores Drive, from El Paseo Street to Murphy Drive

· N. Orange Street, from W. Main Street to Flower Street