Portage council approves $3.7 million sale of general obligation promissory notes
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Summary
The Portage City Common Council approved Resolution 25-019 to sell approximately $3,705,000 in general obligation promissory notes series 2025A to finance 2025 capital projects including streets, stormwater and sewer work; the notes carry a 20-year term and an estimated average tax impact of about $98 on a $360,000 home.
The Portage City Common Council on a unanimous vote approved Resolution 25-019 authorizing the sale of approximately $3,705,000 in general obligation promissory notes, series 2025A, to fund projects in the city's 2025 capital improvement program.
Council authorization follows a presentation by John Cameron, municipal adviser with Ehlers, who outlined the sale timeline, the projects financed and the expected taxpayer impact.
Cameron said the notes "are being issued for a 20 year term." He told the council the sale will be competitive in the open market, with a rating call with Standard & Poor’s scheduled for July 14, the official statement available about July 17, the sale on July 24 and funds estimated to be available Aug. 14. He also said the notes include a call feature allowing prepayment anytime after April 1, 2034.
Why it matters: the borrowing will fund items in the 2025 CIP including streets, stormwater and sanitary sewer projects and certain facility work. Cameron said most projects will be paid from the general debt levy; projects allocated to the sanitary sewer utility will have associated debt service abated by sanitary sewer revenues.
Key facts and figures presented to the council included: - Par amount: about $3,705,000. - Term: 20 years; principal scheduled to begin April 1, 2026, and run through 2045; interest due semiannually beginning in February. - Call feature: prepayment/refinance possible after 04/01/2034. - Estimated average annual tax impact: "right around $98" per year on a property valued at $360,000, according to Cameron. - Estimated initial annual debt service: about $330,000 beginning in 2026, tapering later as shorter items amortize. - General obligation capacity: issuance brings the city to roughly 75% of its statutory 5% limit on GO debt; Cameron estimated the ratio will fall back toward 70% by year-end assuming principal paydown and modest equalized value growth.
Cameron described the city's current Standard & Poor's credit grade as double-A minus and recommended a competitive sale given the size and routine nature of the financed projects. He also noted the presale included a market cushion of about 45 basis points to allow for market movement.
Action: Alderperson Bernander moved to approve Resolution 25-019; Council member Paul seconded. The council adopted the resolution by roll call: Paul (Aye), Flinkert (Aye), Trantau (Aye), Wetzel (Aye), Bernander (Aye), Crowley (Aye), Dunnehy (Aye) and Green (Aye). The motion passed.
Next steps: staff and the city's municipal adviser will proceed with the rating call, post the official statement, conduct the competitive sale on July 24 and report sale results to the council the same evening; funds are expected to be available on Aug. 14.
