Will County board hears refinancing plan to refinance and tender taxable bonds, seeks executive approval

Will County Finance Director Karen Hennessy and outside advisers told the county finance committee that the county can pursue two debt-saving moves: a conventional refunding of callable 2015–2016 road bonds and a voluntary tender of a 2020 taxable issue that could be repurchased at below-par prices. The committee voted to move the proposal to the county executive committee for consideration and to schedule the required public hearing.

Hennessy explained the legal and practical framework for municipal debt and said the county is authorized to issue debt by state statute. She outlined participants in a bond issuance—municipal advisor, underwriter, bond counsel, disclosure counsel, paying agent and rating agencies—and the roughly three-month timeline to prepare an offering, obtain ratings and price new bonds. “There’s a lot of partners you work with, and the resulting paperwork is something that you’re committing to,” she said.

Brian Lipensk, executive director in Wells Fargo’s public finance group, and municipal adviser representatives from Spear Financial described a two-part opportunity. They said roughly $41 million of 2015/2016 series bonds become callable in November 2025 and can be refunded with new, lower-cost tax-exempt debt once the county authorizes the transaction. Separately, they proposed a voluntary tender of Series 2020 taxable bonds (about $150 million outstanding) where holders would be invited to sell bonds back to the county at a premium to market but below par; the county would then issue tax-exempt debt to pay tenders.

Advisers showed preliminary numbers indicating the refunding could lower the county’s average cost of those refunded bonds and that a tender could produce additional present-value savings because the 2020 taxable bonds trade well below par. As Lipensk summarized: the 2015/2016 refunding is priced to an all-in true interest cost near 3.76 percent and the tender idea depends on persuading a portion of bondholders—historically 20–40 percent—to sell back their holdings.

Advisers flagged tradeoffs and risks: tender plans require additional legal and notice work and an information/tender agent (estimated fixed cost about $12,800), dealer-manager fees contingent on the volume tendered, and the county can decline to accept any tendered bonds if market conditions change. “The county’s not obligated to accept any of the tender bonds,” an adviser said, noting the county’s downside in a failed tender is limited to pre‑transaction costs such as the information agent fee.

Committee members asked about timing, legal counsel and call provisions. Advisers said the earliest practical calendar would allow sale in July with closing in mid‑August, which fits the 90‑day window before a Nov. 15 call date. Hennessy said the ordinance authorizing the refunding would typically include parameters (savings thresholds and a six‑month authorization window) authorizing finance staff, working with advisers, to execute the refunding if market conditions are favorable.

At the committee’s request, staff will prepare a resolution and a public‑hearing schedule for the county board; the committee voted to forward the item to the executive committee for placement on the county board agenda.

The advisers and staff emphasized the presentation was preliminary: if the executive committee and county board authorize the transaction, staff would return with recommended ordinance language, final pricing parameters and any required ratings presentations.

Votes at a glance: the finance committee voted to forward the debt refunding/tender proposal to the executive committee; roll call recorded Berkowitz, Butler, Ortiz, Winfrey and Nyquist as voting to advance the item.