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Warrensburg authorizes up to $22 million sewer revenue bond via state direct loan program
Summary
Council approved an ordinance allowing the city to issue a sewerage system revenue bond (State of Missouri Direct Loan Program Series 2025) with a maximum principal of $22,000,000; staff said the state loan offers an interest rate near 2% and would save an estimated $5 million over the bond’s life.
The Warrensburg City Council on April 14 adopted an ordinance authorizing issuance of a sewerage system revenue bond under the State of Missouri Direct Loan Program, Series 2025, for a maximum principal amount of $22,000,000.
Phil Adlidge, interim public works director, said the ordinance gives city staff the authority to sign loan paperwork so the city can access the state revolving loan fund and start the sewer project. Adlidge said the city had already received contractor bids and that paperwork and procurement steps are in place so contractors can begin ordering materials once the loan documents are completed.
Staff and bond counsel representatives attended the meeting and explained the state program’s finance structure. An official noted the state revolving loan typically offers an interest rate that is roughly 30% of market rates and that the program’s current rate would produce roughly a 2% APR. City staff estimated the lower borrowing cost would produce about $5,000,000 in savings over the life of the issuance compared with market alternatives.
Council members voted unanimously to adopt the ordinance. Adlidge and staff said they expect contractors to begin procurement and mobilization after loan documents are finalized. The ordinance authorizes the form and details of the bond and grants staff authority to complete related documents and actions needed to proceed.
