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Cottage Grove awards $3.28 million general obligation promissory notes; true interest cost 3.5837%
Summary
The Village awarded the sale of 2025 Series A general obligation promissory notes to Baird; the final borrowing amount of $3,280,000 came in under the previously authorized TIC cap, and trustees approved the resolution to award the sale.
Village finance staff told trustees the sale of the Village’s 2025 Series A general obligation promissory notes was awarded to Baird, and that the final true interest cost (TIC) for the borrowing came in at 3.5837 percent. Trustees voted to approve the resolution to award the sale and adopt the final borrowing amount.
Why it matters: The notes will finance a mix of capital projects and equipment purchases; staff said the sale’s lower than expected cost reduces the village’s projected debt service slightly compared with earlier presale estimates and affects the debt service levy outlook for 2026.
Details: Finance staff reported five bids were received; Baird of Milwaukee submitted the winning bid. The final net principal and interest (PNI) for the notes was reported as $3,938,809 — about $32,364 below an earlier estimate and about $124,786 below the estimate after market volatility in April. The final borrowing amount included in the resolution is $3,280,000, which staff said reflected the final transactional costs. Staff explained some equipment purchases were amortized over five years and other projects over 10 years. The board packet included a tax‑impact analysis showing the debt‑service levy is projected to increase by about $845,000 from 2025 to 2026 with the current plan and capital improvement assumptions.
Action taken: Trustee Heidi moved approval of Resolution 2025‑08 (authorizing issuance and sale of general obligation promissory note); the motion was seconded and the board carried the motion (recorded in the public minutes as “Motion carries”). The board clarified the resolution had been updated after the sale to reflect the final $3.28 million amount before the vote.
What’s next: Staff will incorporate the final sale amounts into the village’s debt schedule and capital planning documents, and the debt service levy projections will be reflected in upcoming budget materials.
