C7U - Authorize G.o. Bond Issuance

Resolutions - C7 U

C7 U A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE FINANCE AND ECONOMIC RESILIENCY COMMITTEE, MADE AT ITS SEPTEMBER 26, 2025 MEETING, AND AUTHORIZING THE ADMINISTRATION TO EXECUTE A DECLARATION OF OFFICIAL INTENT TO ISSUE ADDITIONAL BONDS OF GENERAL OBLIGATION (G.0.) BOND PROGRAM, NEIGHBORHOODS AND INFRASTRUCTURE CATEGORY, IN THE AMOUNT OF $82.085 MILLION INCLUDING ISSUANCE COSTS. Applicable Area:

COMMISSION MEMORANDUM

RECOMMENDATION

The Administration recommends the City Commission approve an authorization for the Administration to execute a Declaration of Official Intent to issue additional funding of General Obligation Bonds, Neighborhoods and Infrastructure Category, in the amount of $82.085 million, including issuance costs.

BACKGROUND/HISTORY

The General Obligation Bond (G.O. Bond) program was approved by the voters of Miami Beach in November 2018. Residents voted to approve the $439.0 million bond program, million which includes $169 million for parks, recreation facilities, and cultural facilities; $198 million for neighborhoods and infrastructure; and $72 million for police, fire, and public safety. All 3 related ballot measures passed with a support rate of ~70%. The first tranche of new money funding (Tranche 1) in the amount of $151.1 million (net of cost of issuance related expenses) was approved by the City Commission with the goal to advance as many projects as possible. An additional $9.6 million was appropriated from earned interest income to assist in covering additional eligible project costs. A total of 45 out of the 57 voter approved projects have either been completed or are in some form of active status. The funding allocated as part of Tranche 1 in the 3 separate bond categories was as follows:

• • •

In June 2024, via Resolution # 2024-33099, the City Commission approved an initial Declaration of Intent to Issue additional bonds of G.O. Bond funding for the Neighborhoods & Infrastructure Category, totaling $20,030,000, including issuance costs (“the 2024 Declaration of Intent to Issue”). This allowed the continuation of 5 projects: Street Tree Master Plan, Sidewalk Improvements, Street Paving, Seawalls & Shorelines, and Traffic Calming.

To date, approximately 87% of Tranche 1 funds in the Infrastructure Category, and 25% of the funds approved under the 2024 Declaration of Intent to Issue have been utilized. Several projects will soon require additional funding beyond what is currently available.

ANALYSIS

To be able to continue to advance projects within the Neighborhoods & Infrastructure category, it is now necessary to assess the possibility of expanding the previously approved Declaration of Intent to Issue.

The portion of the projects for which the bonds are to be issued is $81,282,000, as described in Table 1 below. The City has not committed any future bond proceeds to upcoming projects.

TABLE 1

* $4M for Town Center and $5M for South Pointe ($9M Total)

The G.O. Bonds will be repaid through the assessment, levy, and collection of ad valorem tax on all taxable property within the City and the full faith, credit, and taxing power of the City will be pledged to the payment of the principal and interest of the bonds. Issuance costs and expenses will be paid by G.O. Bond proceeds. In accordance with the provision of Section 2-278(b) (Exhibit A) procedures governing the issuance of bonds with respect to bonds subject to a referendum, the Administration’s compliance with paragraphs 1 and 2 of Section 2-278(a) was completed with the adoption of Resolution 2019-30754.

Declaration of Official Intent Currently, the Administration is not recommending the immediate issuance of G.O. bonds but to instead request the Commission to authorize the Administration to execute a Declaration of Official Intent defined as:

“Declaration of Official Intent” means a declaration of intent, in the form, manner and time contemplated in the Reimbursement Regulations, that the advances for expenditures referred to therein are reasonably expected to be reimbursed from the proceeds of Bonds to be issued after those expenditures are paid.”

Issuing G.O. bonds with a prior Declaration of Official Intent can be a cost-effective strategy. A prior Declaration of Official Intent is a legal mechanism that allows an issuer to use its own funds initially for project expenses and later reimburse itself with the proceeds from the sale of tax- exempt G.O. bonds. In this case, the General Fund’s reserves would be utilized to provide the interim funding of the projects.

The Declaration of Official Intent will not be effective unless the bonds providing moneys for the reimbursement are issued and the reimbursement for the projects described in Chart 1 above is made within the applicable period prescribed in the Treasury Regulations – generally, 18 months after the later of the date of the expenditure or the date the Project is placed in service, but in no event later than three years after the date of the expenditure. See attached Exhibit B for Resolution 2016-29612 which authorizes Declarations of Official Intent. The Administration may return at a future date to request an increase in the Tranche 2 authorization as additional projects are ready to proceed.

Some advantages to this approach include:

• •

Timing and Flexibility: Delaying the issuance of bonds provides the City with flexibility in terms of timing. It allows the City to initiate and fund a project using the City’s reserves while waiting for the most opportune moment to issue long-term bonds. This can be advantageous in instances where market conditions are not favorable or when the project timeline is uncertain.

• •

Reduced Interest Costs: By using internal funds initially, the City can avoid incurring interest costs associated with long-term debt during the early stages of projects. Taxpayers will not be taxed at this time. Debt service millage will not be increased until after the actual issuance of the Bonds.

• •

Market Conditions: Delaying the issuance allows the City to monitor and take advantage of favorable market conditions. If interest rates are expected to decrease or if there is increased demand for bonds, the City may be able to secure more favorable terms, ultimately lowering the overall cost of financing.

• •

Project Initiation Assessment: The delay provides the City with additional time to assess when certain project milestones are reached. This may involve confirming that the project is progressing as planned.

On September 25, 2025, the Finance and Economic Resiliency Committee (FERC) forwarded to the City Commission a recommendation to authorize the Administration to execute a Declaration of Official Intent to Issue in the amount of $72,282,000. Though the detail per project was correctly listed, the total was incorrectly calculated. This amount inadvertently excluded a $9,000,000 allocation for GO#34: Above Ground Improvements due to a scrivener’s error, resulting in an understated total. The correct total was $81.282 million. The amount required for cost of issuance was not discussed at FERC. Cost of issuance (COI) for a debt issuance for this size is estimated at $803,000. This would bring the total issuance size to $82.085 million.

On November 20, 2025, the G.O. Bond Oversight Committee passed a motion endorsing the Administration’s strategy to execute a second Declaration of Intent to Issue for the projects detailed in Table 1.

FISCAL IMPACT STATEMENT

.

Does this Ordinance require a Business Impact Estimate? (FOR ORDINANCES ONLY)

If applicable, the Business Impact Estimate (BIE) was published on: See BIE at: https://www.miamibeachfl.gov/city-hall/city-clerk/meeting-notices/

FINANCIAL INFORMATION

CONCLUSION

The Administration recommends the City Commission approve an authorization for the Administration to execute a Declaration of Official Intent to issue additional funding of General Obligation Bonds, Neighborhoods and Infrastructure Category, in the amount of $82.085 million, including issuance costs.

Applicable Area

Citywide

Was this Agenda Item initially requested by a lobbyist which, as defined in Code Sec. 2-481, includes a principal engaged in lobbying? No

If so, specify the name of lobbyist(s) and principal(s):

Department

Finance

Sponsor(s)

Co-sponsor(s)

Condensed Title

Issue Additional G.O. Bonds, Neighborhoods & Infrastructure Category. FN