Council directs staff to pursue two-year municipal bond-fund line for near-term capital projects

City finance staff proposed using the Tennessee Municipal Bond Fund to establish a construction-style credit line that would let the city draw funds as projects move to construction and pay interest only on amounts used.

Finance staff said the instrument functions like a construction loan: borrowing costs accrue only on drawn funds, and the approach reduces interest expense on large projects that will be built over multiple years. Project lists in the packet included transportation, signal and sidewalk work and other projects already on the city—s capital plan.

The staff recommendation asked the council whether to borrow two years— worth of planned projects (about $10 million) or three years— worth (about $22 million). After discussion about interest-rate timing and the city—s plan to return to the market periodically, the council voted to send the financing request forward to the council with the two-year funding option.

Councilmember Jones moved to forward the item with two years of projects funded; Councilman Carter seconded. The motion passed unanimously. Staff said it will place a resolution on the upcoming council agenda so that the city can complete the necessary paperwork and, if approved, draw money as projects reach construction readiness.