FINANCIAL FACTS ON BELMONT'S PARKS AND RECREATION BONDS

ü     The Belmont City Council has voted unanimously to place a $12,000,000 parks and recreation bond issue before Belmont voters on November 6, 2007.

ü     The projects included in the bond funding have been developed from a lengthy planning process that included strong citizen input.

ü     All Belmont polling locations will be open from 6:30 a.m. to 7:30 p.m.

How will the City pay for the bond projects?

The City plans to borrow the money by selling general obligation (G.O.) bonds.

Why general obligation bonds?

G.O. bonds are the cheapest, fastest financing option available to the City for these projects.  Because this type of bond pledges the City's taxing authority as a commitment to repay the bonds, financial markets require less interest than other types of municipal borrowings.

How will the City pay back the bonds?

G.O. bonds can be paid back using revenue from many sources available to the City, including fees and taxes.  Since the bond projects can be spread out over a number of years, the City has time to choose the best way to repay the debt.  If approved, the bonds would be repaid over a 20-year period once issued.

How will the Parks and Recreation Bonds affect the property tax rate?

The answer to this question depends on several factors: the growth in the tax base from year to year, the dollar amount and time period in which the bonds are issued, and the availability of other revenue sources available to help pay the bond debt.  If the entire $12,000,000 bond amount were to be issued at one time, it would require a tax rate of 10.6¢ to generate the revenue that would be needed to pay the annual debt costs.  Since it is not the City's plan to issue the bonds at one time but, instead, to do so over several years, the tax implication would be significantly less and would be reduced even further by the continued growth of the tax base.