Joint Committee on Capital Expenditures and Debt Service Planning - June 25, 2026
Joint Committee on Capital Expenditures and Debt Service Planning - June 25, 2026
The meeting was called to order at 6:55 PM with six members present, establishing a quorum. The primary agenda item was the review and discussion of an updated draft debt service spending plan presented by Director Tim Cummings. The plan aims to align with previous policy directives, maintaining an average of approximately $30.5 million in debt sold per year, consistent with a baseline of $25 million plus a 5% inflationary factor. The discussion covered project prioritization, bond authorization schedules, cash flow management, and the distinction between programmed and unprogrammed projects.
Discussion Items
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Presentation of Draft Debt Service Plan: Director Cummings walked through the draft plan, which categorizes debt into white (approved but not fully sold), blue (unauthorized but prioritized), and green (unprogrammed projects). He noted that the plan stays on track with previous policy guidelines, with an average debt sold of about $30.5 million over the planning horizon (FY28–FY33). Key projects programmed in blue include the DPW garage and fleet maintenance facility, library design and construction, fire training facility, ERP system, pool rehabs, and a pedestrian bridge for the Mohawk Tannery redevelopment. Recurring costs such as SERF (surf) at $3 million annually, plus an additional $5.1 million catch-up in FY27, were also included. A $2 million general obligation for paving (FY28) and $2 million for school capital maintenance (recurring) and $1.5 million for fire department capital maintenance were proposed as new recurring items.
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Questions on Debt Timing and Cash Flow: Mayor Donchus and others questioned the sell schedule for the DPW garage (four years of ~$10 million) and library (similar), given that construction is expected to take two years. Director Cummings explained that the city can front cash for up to 18 months and then reimburse itself with bond proceeds, a practice used previously. CFO Enright confirmed that the city currently earns about 3.3% on investments, while new bonds would likely carry a 4% interest rate. The 18-month reimbursement period is a federal guideline, and bond proceeds must be spent within 24 months of issuance, subject to arbitrage reporting.
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Unprogrammed Projects (Green): Projects in green include police station cell block renovation, citywide vehicle wash station, hydroelectric improvements (fish passage and turbine replacement), resource center, and keep auditorium. Director Cummings noted that these are not yet programmed but are open for discussion. The police cell block is a priority but design is ongoing. The vehicle wash station may be accommodated within the DPW garage project if savings allow. The hydro project was presented as a bundled $35 million, but Director Sullivan clarified that $10–15 million is a regulatory requirement (fish passage) and could be partially funded by revenue from the hydro facility. The pedestrian bridge is a contractual obligation tied to the Mohawk Tannery development and is fully offset by tax revenue from that project. Alderman Clee requested that obligatory projects (like pedestrian bridge and hydro) be highlighted in a separate category or with asterisks to clarify that they are commitments.
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Ranking and Prioritization: The draft plan includes rankings from the Capital Improvement Committee (CIC), with 1 being highest priority (e.g., fire deferred maintenance) and 120 being lowest (commuter rail). Alderman Clee expressed concern that the pedestrian bridge ranked 99 despite being a contractual obligation, and asked for annotations to explain that lower rank due to factors like not being shovel-ready. Director Sullivan noted that CIC rankings prioritize need, urgency, and criticality, and that funding availability (e.g., grants) also affects score. The bridge’s lower rank reflects its longer timeline and lack of shovel-readiness.
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Pool Rehabs: Discussion clarified that the plan includes $3 million for three pools, but only two pools (Rotary and Centennial) need replacement, each costing about $2.5 million. Director Cummings agreed to adjust the figure to $5 million for two pools.
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Debt Service Projections and Tax Rate Impact: Alderman Clee expressed concern about the spike in projected debt sold to $50 million in FY32, but CFO Enright explained that the debt service payments are a small percentage of the overall budget and that the schedule will be managed to smooth out increases as old debt rolls off. The goal is to keep debt service and operational budget stable, increasing at a rate accommodated by the tax rate.
Key Outcomes
- No formal votes were taken. The committee directed Director Cummings to make adjustments to the draft plan based on the discussion, including: (1) clarifying obligatory projects (e.g., pedestrian bridge, hydro) with annotations or separate categories; (2) correcting the pool rehab figures to $5 million for two pools; (3) providing a separate chart showing how debt service payments will layer in as old debt is paid off; and (4) refining the spreadsheet to better reflect construction timelines and sell schedules. The updated plan will be brought back to the next meeting for review.
- Policy Reminders: Director Cummings reiterated prior policy directives: avoid bonding for projects under $1.5 million if possible; authorize an average of $25 million in debt per year (with 5% inflation); and use supplemental appropriations from surplus for capital projects (e.g., transportation matches) to avoid bonding and interest costs. He also noted that the plan relies on the city’s ability to exempt bond debt from the spending cap, as has been done in the past, and that legal counsel will ensure proper wording.
Closing
- The meeting concluded with a motion to adjourn, which passed unanimously. Alderman Kelly and Alderman Clemens were absent; the committee extended condolences to Alderman Clemens on the loss of his wife.
Meeting Transcript
Joint Committee on Capital Expenditures and Debt Service Planning to order on June 25, 2026. Mr. Clerk, could you please call the roll? Yes, uh, Mr. Mayor. Um Director Sullivan. Present. Director Foto. Director Cummings is present. Uh Alderman Clee. Here. Uh Alderwoman uh Kelly, I believe is not with us this evening and has sent her regrets. Um Alderman Clemens again is not uh here this evening, has sent his regrets, and then uh President Wilshire here. And then finally, Mayor Donchus. Here with six members present. You have quorum. All right. So I will um recognize Director Cummings to uh show us a draft plan. Thank thank you, Mr. Mayor. So um what's up on the screen and what hopefully hopefully all you have in your hands is an updated draft uh debt service spending plan. Um and it is based off of the work we've done today, uh building upon the work we did two years ago and also the recommendations from the Capital Improvement Uh Committee and the plan that they put out uh just just about six months ago. Um with that being said, what the directors have come before you more recently and has discussed as their priorities. I'm going to quickly walk you through the plan so you can see uh how it is laid out. I'll say for the record that this is a draft and want welcome any type of changes that you see uh as uh important, but the key thing to take away here is assuming we want to continue with the same policy directives we we gave in the past. A couple of years ago we started with uh uh a baseline of about 25 million in debt service to be to be you know sold year over year, adding about a 5% inflationary figure, and remembering that we're trying to do this over an average over X amount of years that you know some years we may be less, some years we may be more than that, but on average we want to we want to be about 25 million plus the the inflationary figure. You can see here uh down in the bottom an average of debt being sold of about 30.5 million, and that stays on track with what we had previously discussed as about 25 million with the uh inflation on average over the horizon of the plan. So what I'm basically telling telling you is as this plan is laid out, we are on track and we are we are on plan. With that now being said, I will go back up to the top, and what you see in white is the approved resolutions of bond authorization that are currently um still active, and you'll note that we haven't sold all the debt yet as authorized, and so we have that accommodated to the years going to the right. Next, you'll see the unauthorized debt, and that is in blue. These are anticipated bond authorizations that have been discussed as priorities, and I have taken the opportunity to program them, and that's what you're seeing going out to the right. The next is our unprogrammed and unauthorized, that is the green. These are projects that didn't make it into the blue category. Um they are still open for discussion, uh, but I but it is how I wanted to present this information to you all uh to show you how we could possibly stay on plan and try to uh accommodate as many projects as possible. I'll note, and I didn't want to do this uh without discussion. Some of the group projects in green could be programmed in the later months. I'm sorry, in the later years, as you can see. I only programmed uh us out through FY33. It certainly could go out in FY34, FY35, so on and so forth, but I wanted to have further discussion before we actually did anything like that. What I really wanted to uh illustrate is that we are on plan. We we are following the directives that had been previously established relative to the policy guidance, and really wanting to make sure that if it's acceptable to this group, we move forward with bond authorizations to continue moving some of the projects forward that we've been we've been working on. We we do have uh a bunch of projects that we could uh issue uh bond resolutions for sometime this summer. I'll I'll just note that I believe that we are ready to issue a construction bond for the DPW garage and fleet maintenance facility. I believe uh we could issue uh another bond for the library and for design. We could issue a bond for the fire training facility. We could issue uh a bond for an ERP system. We could issue a bond for pool rehabs. We have a contractual obligation, and although we don't need to pay for it right away, we do have a need to issue a bond for a pedestrian bridge due to the redevelopment that's happening over on the Mohawk tannery site. And then we do have a couple reoccurring items that I'm gonna talk about. One is surf.
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