Go ahead and call our um August 3rd, 2026 uh pre-council to order.

Uh we have one item on our uh agenda for today, and that's the bond debt discussion.

So Matthew Liu, I assume I'm kicking this over to you.

Yes.

So we're just gonna talk a little bit today about uh our bonding situation, outstanding bonds, uh as well.

We have our financial or our mus uh municipal advisor here from Columbia Cat Capital, uh, Mr.

Jim Pritchett.

Uh so first just uh to go over a few of the different types of bonds we have.

Uh we have general obligation bonds.

Well, we don't have any of them right now, but these are the type of bonds that that are available for municipality.

So we have general obligation bonds, and these are backed by the full faith and credit uh of the city, and they're typically funded by local taxes.

So this is a type of bond that usually has to go out for a vote.

Um most commonly you see uh property taxes associated with uh uh geo bonds, but they they can be sales taxes as well.

The next is revenue bonds.

Uh I believe we have this is the category that we have the most of.

And these are uh payback strictly by the revenues generated within a specific enterprise or if you have a project.

Um and so a good example of these would be our sewer system revenue bonds.

And then lastly we have the special obligation bonds or SO bonds, and these are uh basically certificates of participations.

Um they are special allocation or tax bonds, and they have annual appropriation uh for the payment of the debt.

Here is a uh just a summary of what we have currently.

And so uh for governmental, the governmental accounts we have SO bonds, uh about five point one million, uh five point three total with interest.

We have some uh SO bonds within our business accounts.

Um they total uh fifty-five million in principle, uh six point five in interest for a total of sixty-two million.

Uh and then we have some revenue bonds.

Um again, this is uh where we have the most of our our bonding authority or our bondings outstanding with a total of two hundred and forty-eight million in revenue bonds.

So water electric consumers where those are hit.

So a little bit about the legal framework with our bonding authority.

Um Missouri constitutional constraints, uh, article six of the constitution government governs uh governmental debt limits and the obligation uh debt usually cannot exceed ten to twenty percent of the city's assessed tageable property valuation.

And so this is a good one.

I think we talked about this uh the last time we met when we were asking about uh uh debt for the general fund.

And so this is where that comes into account.

This is what we look at uh when we talk about issuing debt from the general fund.

And then you have uh a voter mandate, which it's about 5050 on what needs to go to a vote versus what does not have to go to a vote.

Um but in Missouri geo bonds recall require mandatory voter approval.

But that's usually in the local arena.

Before you go on from that one, Matthew, so does that mean that any so if we have a sp like in the parks department, parks, you know, it has its own special revenue fund, but is it sort of a general, you know what I mean?

They're in that.

Does that mean like if parks wanted to bond a project but they had a special revenue source, would it have to go to the voters, or what could it be because they're special revenue?

If they have a revenue source already, it could be a revenue bond.

Okay.

Uh but you could also do SO bonds that do not have to go to a vote of the public.

Vote of the public usually for geo bonds.

Right.

They are it it's every time it has to go for a vote of the public.

Or if I I think some certain some SO bonds, if there's not, is if there's not a mechanism to pay them back.

Yeah, if if they're if it's a voter-approved funding source that is going to pay for it, but generally those would be geo bonds.

Okay.

Appreciate that.

Thank you.

And then sort of looking at the constraints at the local level.

Uh so all bonds issued by the City of Columbia must be sold at a public sale.

There are a few exceptions to this, and these are um bonds that are backed strictly by revenues generated from a utility or a project, and then bonds issued to refinance existing outstanding debt, and then bonds being purchased directly by any agency.

Though those are the the three different times that they do not have to be uh go for a public sale.

And so I'm do you all understand the public sale aspect of this?

Explain away that just to be safe.

And so um what usually happens at a public public sale is you have uh your set of bonds and there's a website now.

Now there's a website that people can go on and they bid on the whole block of the bonds.

And so uh for example, like uh if we do the AMI project, there'll be a $39 million block of bonds that uh usually usually bigger companies, um banks, things like that will go on and they they will bid on those bonds so you get the best interest rate.

Thank you.

Can you explain bonds being purchased directly by any agency?