Port Aransas council authorizes $2026 venue revenue bonds after financial adviser reports A-minus rating

Port Aransas City Council authorized the issuance of the city's venue project revenue bonds, Series 2026, following a presentation by the city's financial adviser and a roll-call vote.

Jack Mlan, the city's financial adviser, told the council that S&P had assigned an "A minus" rating to the new issue and that the sale produced a true interest cost of "5.489%." He told council members the city used 11 months of post-implementation history for the 2% venue tax increase to model debt service coverage and that the revenue performance gave investors confidence to buy the bonds. "We came in with a final interest, a true interest cost of 5.489%," Mlan said during his presentation.

The adviser said the financing model conservatively held venue tax receipts flat after the first year and reported coverage ratios near the firm's target. Council members asked whether the city would use the existing 7% hotel tax or the 2% venue tax to pay debt service; Mlan clarified the bond structure relies on the 2% venue tax coupled for coverage analysis with existing hotel-tax revenues and that funds would be available for deposit on or about Oct. 15. "The 2% additional venue tax is being coupled with that to pay the debt," he said.

A council member moved to authorize issuance of the bonds and to authorize execution of any required engagement agreements with the city's financial adviser; after a roll-call the motion carried. The clerk recorded affirmative votes for the council members present and Mayor Moore; the meeting record states "Motion carried."