Germantown board approves nearly $14.2 million in notes, removes Grosnick reimbursement

The Village of Germantown Village Board voted to approve two financing measures on parameters for 2025 borrowings: a taxable issuance not to exceed $9,980,000 and a tax-exempt issuance not to exceed $4,165,000 to fund Village Center property acquisitions, demolition and routine capital projects. The board amended the taxable issue to remove $1,170,000 that had been included to reimburse the village for the Grosnick property purchase.

The action matters because the issuances would finance property acquisitions and other approved capital projects and because some of the purchases tie to the Village Center planning effort that could later be part of a tax increment financing (TID) plan. Financial adviser Phil Casa of Ehlers told the board the two-part structure splits taxable borrowing for land that may be sold to private buyers from tax-exempt borrowing for standard public-purpose capital projects.

Phil Casa, Ehlers, explained the split: "There is no TID 10 at this point," and said the taxable note would be used for property acquisition, demolition and related professional services while the tax-exempt note would finance projects such as roads and equipment. Casa described the taxable note as a 20-year issue and the tax-exempt note as a 10-year issue and told the board the team modeled conservative growth and interest-rate assumptions in projecting tax impacts.

Trustee Meg Cutts said she had "issues with the Grosnick property being in there simply because we already own it," and asked whether the village could wait to reimburse the general fund. A village staff member responded that reimbursing the general fund was the intent and that the board could postpone reimbursement to a later bond cycle without creating a material problem for the fund balance. Trustee Rick Miller moved to remove the $1,170,000 Grosnick line from the taxable issue; Trustee Jan Miller seconded and the amendment passed.

Board discussion also covered timing and process. Casa said the financing team planned a flexible sales timeline to allow for market movement and said, if the board proceeded on the schedule discussed, bids could be taken around June 3, with closings targeted June 26 so purchases could be executed before the July 1 contract deadlines cited in the presentation. Casa said the timeline and the parameters resolutions give the village flexibility to move the sale date if market conditions warrant.

The amended taxable parameters resolution and the tax-exempt parameters resolution were adopted by roll call following the amendment. The board directed staff and the financial adviser to proceed under the parameters and continue communication with the village president and staff before locking final sale dates.

Background: Casa told the board his models assumed long-term conservative growth for property valuations (he said staff discounted recent high five-year growth by roughly 75% in their projections) and included scenarios both with and without a new TID. Casa said the village’s debt-service levy would remain manageable in the firm’s model and that borrowing capacity after these issues would be roughly 43 percent of statutory capacity at the time of presentation.

What's next: The board approved the parameters resolutions as amended and instructed staff and advisors to proceed. The Village Center project and any possible TID would still require separate approvals and community engagement before tax increment revenues could be used to repay any portion of the borrowings.