City of Mesa Municipal Bonds: A Basic Primer For The Public

Here's the Shake-Down:
Municipal Bonds are debt obligations.
Someone has to pay off the debt service - YOU
One way or another it's money taken out of your pockets in any number of ways: (see the Budget Pie Charts for FY2018/2019 that are inserted farther down)
BOND AND DEBT SERVICE
Source: City of Mesa Open Data Portal 
"The City issues debt in the form of bonds to finance long-term capital improvements such as streets, buildings, utility systems, etc., . . .
For the complete City of Mesa Executive Budget Plan click here.

Types of Bonds

The City uses two main types of bond funding in the FY 2018/19 budget:

• General Obligation GO Bonds make up about 30% of City Projects
• Utility Systems Revenue Bonds fund most City Projects

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THE BIG PICTURE
Utility Revenue Bonds 
General Obligation GO Bonds
Street/Highways
WIFA

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Readers might want to see this >
GO Bonds
General Obligation debt service payments are shown in the chart to the right.

< and this
Utility Systems Revenue Bonds Debt Service Payments Schecule

Debt service payments for Utility Bonds are funded by rate charges paid by utilities customers.

Here's a Financial Breakdown for Data provided in 2017 that is featured in a New Report from Truth In Accounting that was released on January 28, 2019 

2019 Financial State of the Cities
January 28, 2019

On January 29, Truth in Accounting released its third Financial State of the Cities report, a comprehensive analysis of the fiscal health of the nation's 75 most populous cities based on fiscal year 2017 comprehensive annual financial reports. 

This year, the study found that 63 cities do not have enough money to pay all of their bills, and in total, the cities have racked up nearly $330 billion in unfunded municipal debt. The study ranks the cities according to their Taxpayer Burden or Taxpayer Surplus™, which is each taxpayer's share of city bills after available assets have been tapped. Check out the data for your city at the State Data Lab.

Mesa, AZ

The Bills Mesa has Accumulated

State Bonds * $1,797

Other Liabilities * $267

Less: Debt Related to Capital Assets * $1,658

Unfunded Pension Benefits * $830

Unfunded Retirees' Health Care Benefits * $648

Bills * $1,885

• * figures in millions

Source: State Data Lab Mesa, AZ 

 

2017 Financial State of Mesa

(Released 1/29/2019)

Mesa's Taxpayer Burden.™ is -$5,800, and received a "D" from TIA.

Mesa is a Sinkhole City without enough assets to cover its debt.

Decisions by elected officials have created a Taxpayer Burden™, which is each taxpayer's share of city bills after its available assets have been tapped.

TIA's Taxpayer Burden™ measurement incorporates all assets and liabilities, including retirement obligations.

Mesa only has $1.1 billion of assets available to pay bills totaling $1.9 billion.

Because Mesa doesn't have enough money to pay its bills, it has a $812.5 million financial hole. To erase this shortfall, each Mesa taxpayer would have to send $5,800 to the city.

Mesa's reported net position is overstated by $175.3 million, largely because the city delays recognizing losses incurred when the net pension liability increases.

The city's financial report was released 186 days after its fiscal year end, which is considered untimely according to the 180 day standard.

 

Some Budget Pies For You to Look from this Fiscal Year 2018/2019

TOTAL CITY BUDGET $1.82B

There are four

Here's one that shows you where the money is spent in Expenditures, by Category >

 

 

 

 

 

< Here's another one for Bonds by Project Category

$203.7M

 

Note the large piece-of-the-budget pie for Wastewater and Water Treatment

 

Transportation/Streets eats up 12%

Parks

Public Safety

 

Here's one more

TOTAL AVAILABLE CITY RESOURCES

$1.82B

Looks like "A Balanced Budget" with the same number for Expenditures and Resources

Biggest source of resources:

Sales & Charges for Services: 565.1M

Intergovernmental: $243.2M

Taxes: $208.2M

 

NOTE: Use of Reserve Balance: $250.3M

This is usually a NO-NO in accounting practice

 

. . . and just another one

TOTAL CITY BUDGET BY FUND

 

 

 

 

 

 

 

 

 

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Let's take a look at one credit-rating agency: Moody's
Source: Moody's Credit Rating/City of Mesa

Moody's Org ID:600023957

LEI:549300L1QYAKFHSIGE94

6 Digit Cusip: 590485, . . .

 

Here are four entries for 2019

Notice that some documents are locked. You need to subscribe to open them up.

These are the first four and most recent in 95 results. The first page in the list  1-50 goes back 2012 if you are interested in see the document types.

 

18 Apr 2019	Credit Opinion	Mesa, AZ: Update to credit analysis	Moody's Investors Service
18 Apr 2019	Credit Opinion	Mesa Combined Utility Enterprise, AZ: Update to credit analysis	Moody's Investors Service
17 Apr 2019	Rating Action	Moody's assigns Aa2 to City of Mesa, AZ Combined Utility Enterprise's Utility Systems Revenue Bonds, Series 2019A, 2019B, and 2019C	Moody's Investors Service
17 Apr 2019	Rating Action	Moody's assigns Aa2 to City of Mesa, AZ's GO Bonds, Series 2019	Moody's Investors Service