Rio Rancho approves up to $25 million utilities revenue bonds for water and wastewater projects
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Summary
The governing body approved ordinance O26 authorizing the issuance of up to $25 million in water and wastewater system improvement revenue bonds to fund parts of a five‑year capital plan.
The Rio Rancho governing body voted to approve an ordinance authorizing the issuance of water and wastewater system improvement revenue bonds with an aggregate principal amount not to exceed $25,000,000.
Financial Services Director Jaramillo told the council the bonds would finance improvements to the city’s water and wastewater systems and that the utility’s five‑year capital improvement plan totals $218.4 million. Director Jaramillo said the bonds would be the first of two planned issuances and that the aggregate principal amount would not exceed $25 million, the interest rate would not exceed 12 percent and the final maturity date would be no later than May 15, 2057. She also said pledged revenue would be the utilities’ net revenue and that, if sold by negotiated sale, the underwriter’s discount would not exceed 1 percent.
Why it matters: The issuance adds a borrowing tool to the utility’s longer-term funding strategy intended to spread large project costs while seeking to keep utility rates stable over time. Staff framed the sale as part of a strategy to maintain predictable debt service levels while funding growth- and non‑growth-related projects in the ICIP (capital plan).
Vote: The ordinance (O26) passed on a roll-call vote with all councilors voting yes.
Next steps: Staff is authorized to proceed with issuance and the ordinance delegates signing authority to the mayor, city manager and finance director to execute documents needed to facilitate a sale. The timing and sale method (competitive or negotiated) will be determined when the bonds go to market.
