Ten Texas cities have put a combined $1.7 billion in bond propositions on the May 6 ballot. Bond debt is used to finance spending on big projects, and all the borrowed bond money must be repaid with interest by local property taxpayers.
Texas cities currently owe a combined $40 billion in property tax-backed bond debt, plus another $50 billion in revenue-supported debt, according to the Texas Bond Review Board.
Streets, parks, and even an airport top the list of projects that cities want to finance with the proposed bonds.
Cities are legally required to publish Voter Information Documents that show the total cost to taxpayers of bond propositions, including interest, as well as the city’s current outstanding bond debt principal plus interest.
The documents are typically tough to find, either buried on cities’ splashy bond marketing websites or posted on completely separate web pages.
Below is a look at the five biggest city bond packages on the May 6 ballot. (Click on city names for details.)
Frisco’s largest bond proposition, Proposition B, allows the city to borrow and spend $249 million for street and road improvements. With interest, the bonds would cost taxpayers $399 million—60 percent more than the amount voters see on the ballot.
City officials say in their bond marketing materials that they don’t “anticipate” a tax rate increase. Yet even at the same rate, residents’ property tax bills will go up as property values increase, and the ballot language authorizes the city to raise the rate as needed to collect property taxes “sufficient to pay the principal and interest on the bonds.”
Arlington’s biggest bond proposition also targets street improvements. Proposition A’s face value is $219 million, but with interest the total cost to taxpayers would be $311 million.
The city calls the proposed bond package a “five-year” program, but Arlington property taxpayers would be footing the bill for 25 years, until the bonds are paid off in 2048.
Round Rock’s Proposition A seeks a whopping $230 million to spend on parks and recreation. With interest, the bonds would cost city taxpayers $383 million—67 percent more than the amount shown on the ballot.
McKinney’s Proposition A would fund a controversial expansion of the city-owned airport to accommodate potential commercial passenger service.
McKinney Mayor George Fuller and other local real estate development interests are backing the bond, while city residents concerned about the airport expansion’s financial and environmental impact oppose it. Mayors of two neighboring cities— Henry Lessner of Fairview and Jim Olk of Lucas—also oppose the airport expansion’s anticipated noise and traffic impacts on their residents, who don’t get a vote on the bond.
Three political action committees have spent money to influence voters on the bond. A pro-bond PAC reported raising $40,500; two anti-bond PACs, one based in McKinney and another in Fairview, report raising a combined $15,000.
Pearland’s big bond proposal, Proposition A, seeks $105 million for drainage projects. With interest, the bonds will cost local property taxpayers $177 million—69 percent higher than the amount voters see on the ballot.
In addition to the 10 cities with bond propositions on the ballot, more than 100 school districts are proposing a total of $25 billion in bonds that will increase local residents’ property tax burdens.
Early voting is underway now through May 2. Election Day is Saturday, May 6.