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Boone maintains A1 Moody’s rating as council approves $1.275 million bond sale after annual TIF briefing
Summary
City financial advisor presented the annual tax increment finance (TIF) and debt report, highlighting more than $1 billion in valuation and large debt capacity; council approved a $1,275,000 general obligation capital loan note sale, awarded to Robert W. Baird, and heard that Moody’s affirmed an A1 rating.
Maggie Berger, financial advisor with Spear Financial, told the Boone City Council the city’s annual tax increment finance and debt report shows the city’s valuation passed $1 billion and that the city has substantial debt capacity.
Berger said Boone’s valuation was about $1,070,280,000, producing a statutory debt limit she calculated as $53,514,000; she said general obligation bonds outstanding remain small relative to that limit and recommended preserving a portion of capacity for emergencies. “You still have more than 93% of your debt capacity remaining,” Berger said.
Berger walked the council through types of debt in the report: general obligation (which counts toward statutory debt limits), revenue debt (paid from water or sewer revenues and not levyable), and rebate agreements (developer rebate agreements paid annually from TIF receipts). She noted some sewer revenue debt is being paid with TIF revenues because earlier infrastructure upgrades enabled new development. She reminded the council that certification for fiscal 2027 is due by Dec. 1, tying the timing of the report to that statutory deadline.
On the same evening the council approved a resolution directing the sale of $1,275,000 in general obligation capital loan notes, Series 2025. Berger and city staff said the city received competitive bids and recommended awarding the sale to Robert W. Baird. She told council members that Moody’s Investors Service had reviewed the city and affirmed an A1 rating; she said that rating, together with the city’s liquidity—about a 60% ratio as reported to Moody’s—helped secure a lower interest cost for the issuance.
Berger said the winning bid produced an effective interest cost of about 3.28% on the issue and that, in the advisor’s view, unrated municipal issues in the recent market had yielded higher effective rates. She noted two bidders participated and that rated issues attract more bidders in current market conditions.
Council members approved the resolution on a roll-call vote; all members present voted yes.
Why it matters: The TIF and debt report frames near-term budget choices (including what to certify by Dec. 1) and how future infrastructure borrowing might be structured. The bond sale and Moody’s rating affect the city’s borrowing cost for capital projects.
Details from the report and bond sale: - Valuation reported: $1,070,280,000 (Berger’s presentation). - Statutory debt limit presented: $53,514,000. - Outstanding general obligation bonds noted as relatively small compared with capacity. - $1,275,000 general obligation capital loan note sale, Series 2025 — award recommended to Robert W. Baird; council approved the resolution. - Moody’s rating: A1; liquidity ratio cited at roughly 60% in the Moody’s discussion.
Council and staff comments stressed fiscal prudence. Berger recommended preserving some debt capacity for emergencies and told council members that maintaining fund balance and liquidity is important to investors and rating analysts.
Provenance: See transcript blocks where Berger presented the TIF/debt report and where the bond sale/resolution and Moody’s rating were discussed.
