The Pflugerville City Council on Tuesday approved special assessment costs and the issuing of bonds for the Meadowlark Preserve public improvement district in eastern Pflugerville.
The Meadowlark Preserve neighborhood will include 375 single-family units ranging from townhomes, triplexes and single-family homes. Lennar is set to develop it.
Future property owners in the development could pay an estimated additional tax at a $0.7025 per $100 assessed value to fund improvements to wastewater, drainage and roads within the development area. The rate is based on an assessment of each property’s future benefit to improvements and to portion out costs among property owners.
According to the service and assessment plan for the development, the total estimated cost for improvements is $19.5 million.
Rob Hayslip, a project analyst for the city’s public improvement administrator, P3 Works, said property owners will be able to pay their assessment rate in annual installments over a typical 30-year period or in full at any time.
The council also approved the selling of $14.7 million in public improvement district bonds with a 6.05% interest rate for the development. According to the council’s agenda packet, the developer asked for the city to issue bonds to finance the project. The property assessment rates will be used to pay for those bonds.
Dusty Traylor, a financial advisor for the city, said although the bonds are not backed by the city but by the property owners within the development, the city got favorable rates for them. He said investors showed great confidence in the development due to the rapid growth rate in Pflugerville.
“It’s a very well-run city (that’s) growing,” Traylor said. “When we sell these bonds right now, the owner of that property is Lennar … (and) the owner of the property and the payer of the assessment will ultimately diversify very quickly. The investors have strong belief in the actual development.”
Council Member Melody Rogers asked if the bond could be refinanced in the future if interest rates improve. Traylor said the bonds could be refinanced starting in 2033 and that the annual assessment payments made by property owners could, in turn, be lowered.
“You would have to go back in and reevaluate the service and assessment plan and ultimately update those costs,” Traylor said. “But it would reduce the annual debt payments that are required.”
