March 15, 2023 UPDATE:

Thank you to all who voted in yesterday’s municipal elections! The City of Delray Beach has heard the voters loud and clear. They have chosen to invest in our city by adopting the two proposed general obligation bonds, and we are ready to move forward with plans to make their lives better and safer for decades to come. 

Delray Beach leadership will bring a $100 million Public Safety General Obligation Bond referendum and a $20 million Parks General Obligation Bond referendum to the voters during the March 2023 municipal elections. The G.O. Bonds will pay for new police and fire facilities, as well as various improvements to city parks and recreational facilities, and are backed by the full faith and credit of the City’s ad valorem tax revenues.

Delray Beach has grown significantly over the last 30 years. As our city grows so does the burden on our public safety infrastructure. The goal of Delray Beach's public safety professionals is to protect the well-being of our residents and visitors by safeguarding them from crime, disasters, and potential threats.

The proposed G.O. Bond will finance the cost of much-needed renovations and innovations to the existing police station (located at 300 W. Atlantic Avenue), Fire Station 111 (located at 501 W. Atlantic Avenue), and Ocean Rescue Headquarters (located at 340 South Ocean Boulevard), as well as fire stations 112, 114 and 115 located throughout the city.

Public safety facilities are rigorously designed to meet specific public safety needs to ensure that daily operations are performed efficiently, safely, and within state and federal statutes and regulations. Improvements to public safety facilities can affect response times, provide costs-savings to tax-payers over time, and improve the safety of residents and first responders alike.

$20 Million for Parks Improvements

The City of Delray Beach is known as a world-class leisure and sports location for both amateur and professional athletes. City staff is continuously working to provide the highest quality parks, facilities, and amenities to meet the needs of both current and future residents, while planning for continued growth.

The G.O. Bond would fund projects up to $20,000,000 at Catherine Strong Park (located at 1500 SW 6th Street), and various other parks across the city. 

Funding will go towards:

• A covered artificial multi-purpose practice field
• Covered basketball courts
• Walking trails
• SplashPad improvements
• Staff & meeting room facilities
• Restroom & lighting improvements 

Parks are an essential part of any city. Parks promote health and wellness and drive programming and educational activities that impact childhood development. Parks create economic opportunity by attracting visitors and businesses to the area. They build, unite and strengthen communities by providing public spaces for people to come together.

• September 2022: City Commission authorized the holding of the bond referendums
• December 2022: Notification of Supervisor of Election
• January 2023 – February 2023: Publication of public notices
• March 2023: Voters decide
• Summer 2023: Earliest date an initial series of bonds can be issued

The City currently has two (2) issues of general obligation bonds outstanding. The proceeds of these bonds (Series 2005 and 2013) were used for the acquisition of land, equipping of new parks, construction of new recreation centers, and construction of a parking garage and a library. These bonds were also used to refund the Series 2004 bonds. The Series 2005 and 2013 bonds will mature fully in Fiscal Year 2024.

Will this make taxes go up?

Yes, there will be an impact to residents’ ad valorem tax bill. 

What will the Parks GO Bond cost the average resident?

The estimated cost to a resident (with a $250,000 taxable assessed value) will be about $22 annually for the Parks GO Bond referendum.

What will the Public Safety GO Bond cost the average resident?

The estimated cost to a resident (with a $250,000 taxable assessed value) will be about $107 for the first year of the Public Safety GO Bond referendum. After the City retires its 2005 and 2013 bond debts, on February 1, 2024, the cost is estimated to go down to $90 annually.

Will the G.O. Bond pay for a new fire station at Atlantic Dunes Park or Anchor Park? 

No, approximately 80% of the Public Safety G.O. Bond will go toward our police station. The remaining funds will go toward improving our existing fire stations.

Why now? 

While long-term interest rates have increased from their historic lows in 2021/2022, they are still very attractive from a historical perspective.  For planning purposes, the city has assumed a 4.25% borrowing rate for each 30-year financing.    

When would the city be able to access the funds?  

If the referendums are approved, the City would be able to access funds within 3-6 months from their approval.  Bonds would be issued based on each projects’ construction timeline to minimize financing costs.  

What is a general obligation bond?

A general obligation bond (G.O. bond) is a form of debt obligation that provides local government with funds to finance large capital improvements, such as those currently proposed for enhanced parks and recreational facilities, neighborhood and infrastructure improvements, and public safety.

• General Obligation (“GO”) Bonds are a financing mechanism to fund improvements immediately
• Bonds are backed by the full faith and credit of the issuing municipality
• Repaid through the imposition of a dedicated debt service millage levy (Ad Valorem tax)
• Note: The debt service millage is not included in a City’s statutory millage cap
• Historically one of the most credit-worthy financing structures available
• Projects financed with GO Bonds typically have broad community benefits, such as parks, police/fire facilities, or bridge and street-related projects
• A city-wide voter referendum is required prior to the issuance of GO Bonds
• The city is not obligated to issue GO Bonds.

What can general obligation bonds be used for?

General Obligation Bonds allow the City to pay for major capital investments having a public purpose, such as quality of life enhancements related to parks, community recreation, and cultural facilities; neighborhood and infrastructure improvements.

Bonds are sold to investors and the proceeds from the sale of these bonds are used to pay for capital projects. Bond funds cannot be used for everyday operating costs, such as salaries for police officers, firefighters, or City employees (other than those working directly on capital projects). Such operating expenses are paid for by annual revenue that supports the City’s General Fund, such as property tax revenue.

Why does the City issue bonds to pay for City projects rather than pay for projects with cash?

The Bond Program includes many planned and recommended large-scale projects throughout the City.  Current funding for capital projects in the City’s operating budget is very limited, compared to the number and costs of capital requests.  Using bond financing to fund large-scale projects, in a period of relatively low-interest rates and lower costs of borrowing (especially given the City’s favorable credit rating), allows the annual City operating budget to be allocated toward annual and ongoing costs such as maintenance, personnel, operations, and public service programs.

Issuing GO bonds also provides an equitable method of financing these types of projects.  Taxpayers of several generations will both benefit from and pay for these projects, therefore no one group of taxpayers will be unfairly burdened.  

Can bond funds be spent on salaries for staff and elected officials, day-to-day business operations, or events?

No. Bond proceeds cannot be used to pay the day-to-day operating costs. The proceeds can only be used on the approved projects indicated in the bond referendum questions. 

Has the City recently increased its property tax rate?

No. For Fiscal Year 2023, the City Commission adopted a total millage rate of 6.6665 mills, which is a reduction from the previous year’s total adopted millage rate of 6.8403 mills.  The total millage rate for the current fiscal year consists of an operating millage component (6.5111 mills) which is used to fund general government operations as well as a debt millage component (0.1554) which is used to pay for debt service on the City’s existing general obligation bonds.  Both of these rates were reduced from the previous fiscal year.  

Still have questions? Let us know here: www.surveymonkey.com/r/GoDelrayBeach