The prospectus for the 20 million dollar municipal bond was finally launched today, after months of delays.
It's been a long time coming - but the Mayor says the prospectus is distilled to a fine essence - balancing the city's sustainability against the council's grand infrastructural ambitions.
Jules Vasquez got a first taste today:
Jules Vasquez Reporting
Today there was a rare sighting of most of the city councilors - and they sat in thrall for the Darrell Bradley show:
Darrell Bradley - Mayor, Belize City Council
"The Municipal Development Bond, as it is called, is a first of its kind in Belize. It's actually the first municipal bond that has been done by any municipality in the Caribbean region." Everything you need to know about the municipal development bond is contained in this 22 page document - the much discussed and much delayed prospectus.
For regular city residents - the most interesting part would probably be this page - listing the 67 streets that the city intends to pave with the bond money.
It's already spent almost 4 million dollars paving or partly paving these 33 streets in the city.
And while the bond will gave a major infrastructure boost, the Mayor says all these streets are only a means to an end:
Darrell Bradley
"We are not building streets. This infrastructure project fits into a larger vision that calls for the economic development of our city, so that it's not a street building project. It is one element of a larger strategy. Within 3 years, we want to see Belize City as being the commercial capital, that Belize City really regains its glory, and it regains its prominence as being that gateway for the country of Belize."
A large vision - but the fine print is what counts in this document - and the question is - is the city over-extending itself:
Darrell Bradley
"The City Council, by law, has assigned the most reliable sources of its revenue, which is the subvention that we receive from the Central Government and the cruise ship head tax. And those monies will be paid directly from the Ministry of Finance, into the Central Bank of Belize to capitalize the syncing fund. And that will then manage the repayment to bondholders."
And with its most reliable sources of income gone, that takes away a full 15% of the revenue pie:
Darrell Bradley
"The City Council is a 17 million dollar organization. Every single year, the City Council takes in 17 million dollars in revenues, and the loss of revenues in terms of the combined head tax and the subvention, that only amounts to roughly 15% of our total revenues. That's only 2.5 million dollars out of 17 million which we take in every single year."
So will the council be able to manage its affairs without that revenue? Well, that's where you come in - you'll be paying more tax:
Darrell Bradley
"The main thing that we want to do is the residential garbage fee, and what we're talking about here is a 10-dollar fee that we're going to charge per household per month, and this will assist us in making up the revenue. We also have to do increases in - and moderate increases - in property taxes."
And if paying more tax still leaves you with a craving for concrete streets, well then you can buy into the bond, too:
Darrell Bradley
"We have a 2-year issue, which is 3.5%, a 5-year issue, which is 5.5% percent, and a 10-year issue which is 8%. This is an opportunity for persons to become more involved in taking back our city, in reclaiming what is our right, and really lifting up and Belize City into that place that we love to live in. This is a good investment. When you go to the banks, they're giving you 1 and 2%. If you stay with us for 10 years, we're giving you 8%, and your money will be in the Central Bank of Belize."
So, it's not a bad business move - but the success of the bond will pivot ultimately on how many institutional investors it can attract with that pitch...
The minimum subscription is a single two hundred dollar block.
Interest will be paid every six months.
The offer will be open for 28 days from the 26th of November - meaning that the offer closes on Christmas Eve.
You can see the prospectus starting tomorrow on the City Council website. Subscription forms are available at the Central Bank.
