The following information is related to the Two Big Projects. No New Taxes ballot measure. Please see the Introduction to Two Big Projects. No New Taxes for a project overview.
The Colorado Constitutional provision known as TABOR (Taxpayer’s Bill of Rights) requires that voters must approve whether local government can issue debt--essentially borrow money. On August 27, City Council voted unanimously (7 - 0) to place an issue on the November ballot asking citizens to allow bonding to fund two capital improvement projects. Municipal bonds are commonly used by cities to fund capital improvement projects. Voter acceptance to allow bonding would NOT REQUIRE ANY NEW TAXES.
How Can the Projects be Funded with No New Taxes?
In 2018, the City will finish paying off a previously issued bond, freeing up $4.5 million in annual payments already accounted for in the City’s current budget. “Debt re-authorization” means voters agree to allow the money from the previous bond to be applied to a new bond whose funds would be used for the new capital improvement projects.
These two major transportation projects will require $79.8 million to complete:
- Ralston Road between Yukon and Garrison St.: $15.3 million (learn about the project)
- W. 72nd Ave. between Kipling St. and Simms St.: $64.5 million (learn about the project)
The cost of the bond repayment would be $5.5 million per year. Because $4.5 million per year is already in the budget, and the source for the additional $1 million per year has already been identified, No New Taxes would be required to complete these two big projects.
Benefits of Funding Now
Funding the projects now provides citizens the benefit of two very needed road projects being completed sooner rather than later. If the re-authorization is accepted, the projects will be completed in five years. Building up the necessary funds to cash finance the projects would take approximately two decades.
Funding the projects now allows the City to borrow money at less than 3.5%, a much lower rate than ongoing inflation of road construction costs. In fact, if the City were to wait to cash finance these two projects, because of the time it would take to do so and accounting for inflation, the total projects cost would go from $79.8 million to $130 million.
Arvada's Commitment to Capital Projects
By charter, the City of Arvada is required to spend 60% of each $.01 of sales tax revenues on capital improvements (or toward the repayment of debt related to capital improvements). The $5.5 million directed annually to the repayment of funding these projects would contribute toward satisfying that requirement.
For questions about Two Big Projects. No New Taxes, please contact Maria VanderKolk, City of Arvada Communications Manager, 720-898-7507 or email@example.com.