Commerce council approves $8.6 million certificates of obligation after favorable AA- rating

The City Council adopted an ordinance July 15 authorizing the issuance and sale of the City of Commerce, Texas, Combination Tax and Revenue Certificates of Obligation Series 2025, a competitive sale the city’s financial advisor described as “tremendously successful.”

Jim Sabonis of Hilltop Securities, the city’s financial advisor, told the council the competitive sale drew six bids, the city’s AA- rating was affirmed, and the transaction totaled approximately $8,615,000. “This is a tremendously successful transaction,” Sabonis said, and he described the sale as outperforming the city’s plan finance assumptions by about 26 basis points, which the advisor estimated saved roughly $1,560,000 in interest costs compared with the plan assumption.

Allocation and terms: Sabonis outlined a pro rata allocation of the issue with roughly $6.4–6.5 million tax-supported and $2.0 million for water and sewer (utility-supported) projects. The bonds carry a 25-year amortization schedule. Sabonis also said the executed documents will be submitted to the Texas attorney general’s municipal bond review, which typically takes about 15 working days, and that closing steps would follow that review.

Why it matters: the issuance will fund the city’s 2025 capital improvement program — including streets, municipal facilities, water and sewer projects and public safety equipment — while the AA- rating and competitive sale terms reduced projected interest costs.

Council action: a motion to adopt the ordinance passed by voice vote. Hilltop and city staff will complete required post-sale filings and the attorney general review before final delivery.