Very well trained.

Everybody got some nicer function.

All right.

It is six o'clock.

We'll call the Tuesday, August 25th, 2026 meeting of the finance committee to order.

We have a full committee this evening.

Next item on our agenda is the Pledge of Allegiance.

I pledge allegiance to the planning.

Next item on the agenda is public comment.

Is there any members of the public wish to be finance committee this evening?

Thanks.

We'll move on to item number four aid, which is approval of minutes for the 14th of July.

Any changes to those minutes during the committee?

All right.

Seeing none of those minutes are approved through unanimous consent.

That'll move us into our business items.

First of all, I want to welcome everyone to the kickoff of 2027 budget season.

I want to um I see a lot of members of the council here this evening.

Thank you for coming and a lot of members of this the management team and staff that pulled our show and tell together tonight.

So the the run of show um for the committee is I want to remind everybody that we're always on.

So we do have kind of a hot mic situation up here at the front table.

Um so and as you do speak, if you just enunciate a little bit, so um Anthony and Patricia can pick us up on the camera.

Uh we've got a couple of regular business items, and then we're going to wrap up with um a review of the fleet that's in the city garage, and we will adjourn the meeting from the city garage.

So we will not be reconvening back in this room once we move on to 5D, which is the show and tell.

So with that, uh we'll move to item number five A, which is a matter of report, and it's a presentation by our friends at Baird of the 2026 proposed borrowing to support the city capital improvement program.

Frad, good evening.

So this presentation is all behind you, sorry.

That's where the screen is here, though.

So this presentation, this agenda item is really in relation to your 2026 CIP, not the you know the 27 that you'll be talking about a little later tonight.

Just by way of a timeline with your authorization tonight, this would be forwarded to the council for action on September 1st.

Baird and city staff would then take steps to bring this issue to market, including the uh preparing the official statement, the offering document, uh securing a bond rating, and marketing the notes to investors nationwide.

We plan to finalize interest rates on or about September 22nd, and then the funds would close and be wired to the city on October 13th.

Um following the page, just by way of summary, this is uh issue size is 20 million seven hundred thirty-five thousand dollars.

General obligation promissory notes.

That means that the city is pledging its tax authority to support or secure the repayment of the notes.

That's a very strong pledge, and that uh along with the double A2 rating of the city is gonna really drop drive interest rates down.

It's gonna really lead to a low interest rate financing.

Um in terms of purpose, there's really two primary purposes.

First, there's the funding of your CIP, which is levy supported, and that's $18,395,000.

And then there's road improvements in t in a TID at the uh TID 17, $2,734,000.

$2 million $2,340,000.

Excuse me.

The debt service on the TID repayment supported from TID revenues, not a separate tax levy.

So we're combining those two purposes together to generate the overall issue size of two 20 million seven thirty-five.

And the final two maturities are callable that's eligible to be prepaid at the city's option beginning in 2033.

So more than five million dollars of principal has that call feature attached.

Estimated interest rate based on current market is uh 3.78%.

Now the resolution that you're considering identifies certain parameters once those parameters are met, and the and the other uh material is in place, the official statement, the bond rating, then we're ready to take us to the marketplace.

Summary of the parameters are on the bottom of this page.

So there's a not to exceed borrowing amount, not to exceed interest rate, which is about one percent higher than the market rates.

Of course, you'll get the best available market rates, but we in any case we can't go over the 475.

If the market moves above that, we'll we would need to come back.

Other parameters include the maturity structure that I talked about, and then there's the authority to increase or decrease annual principal payments by up to two million dollars, and that's to uh meet the debt service targets that the city would like, which is really a level repayment.

So we can make those adjustments right up to the uh at the time of pricing, the time that we're finalizing terms and rates.

For anyone who wants to dig into the numbers, the last page of this presentation is all of the city's existing debt that's supported by tax levy.

That's the left hand side of the page.

Those uh all of that is fixed rate, so fixed payments, none of that would change unless the city takes steps to call or repay that debt towards the center of the page in the boxed in areas that the new issue for 2026, 20 million seven thirty-five.

And you can see the allocation of the debt service that is the principal and interest payments supported by tax levy or general fund and supported by TID.

So the far right hand column then shows the budget uh for 26 debt service was just over 27,374.

That would increase to 28 million two hundred and ten thousand in 2027, and then you'll see there's a scheduled drop in 28.