Davenport tells Madison County supervisors they are in strong financial shape but must plan for $20M in potential capital needs

Davenport & Company, the county—s financial advisor, told the Madison County Board of Supervisors that the county has posted several years of positive fiscal results but faces a choice about how to pay for roughly $20 million in newly identified capital projects.

Kyle Alex of Davenport said the county—s general fund and unassigned fund balance are in healthy condition and that Madison has seen steady revenue growth, especially outside of property tax: "Sales tax has actually been growing on average 12% a year," he said. "Hotel and motel has actually been growing on average at 26% a year." Alex said Davenport—s review showed median household income growth in Madison outpacing state and national averages over the last five years, and that the county—s assessed-value-per-capita and fund-balance ratios compare favorably with peers.

Davenport reviewed the county—s debt profile (about $21.4 million in fixed-rate debt) and fund-balance policy (an 18% target). Jennifer Warren, finance director, and Jonathan (county staff) joined Davenport in discussing capital needs assembled from a facilities condition assessment. The list includes school and county facility projects and totaled about $19.8 million in additions over five years beyond already-committed FY2025 items.

Why it matters: Davenport framed the question as trade-offs the board will face during budget season. The county could fund projects with pay-as-you-go dollars, deplete fund balance, or borrow. Alex highlighted that higher short-term interest rates also let the county earn meaningful interest on cash balances, which affects the calculus about using fund balance versus financing projects.

Key details and scenarios: Davenport presented three funding scenarios: (1) a $20 million total funding plan using a $7.5 million interim construction loan rolled into a $20 million permanent financing in later years; (2) a $15 million plan with smaller interim financing; and (3) a $10 million plan that halves the initially proposed borrowings. For modeling conservatively, Davenport used interest-rate assumptions of 4.5% for interim financing and 5% for permanent financing, and a 15-year amortization for permanent debt. Alex cautioned the board that the modeling treated property tax as the sole lever to show an order-of-magnitude budget impact, but noted that in reality the county has other growing revenue streams—sales, meals and lodging taxes—that could cover some debt-service costs.

Discussion and direction: Supervisors asked about specific project prioritization and school funding options. Supervisor comments referenced prior, one-time pandemic-related revenue spikes and asked the county and school division to reconcile the facility-condition project list against realistic cost estimates. Davenport and staff flagged that much of the new list is school-related and recommended further study of state school funding options (for example, literary loans and any future sales-tax mechanisms considered by the General Assembly), noting those options are competitive and not guaranteed.

The presentation closed with Davenport saying the county remains within policy limits even under conservative financing, but with the caveat that continued pay-as-you-go funding will reduce fund-balance cushions over time. Board members and staff agreed to use Davenport—s analysis as a starting point for budget-season decisions and to revisit scenarios and priorities as FY2026 budget proposals develop.

Ending: Davenport said staff should expect follow-up work closer to budget time, including refined scenarios and further discussion of the CIP list and school projects. Jonathan and Warren confirmed staff will incorporate the report into next steps for FY2026 budget planning.