Cleburne staff outline $15.5 million certificates-of-obligation plan for roads, public‑safety design and a service center

At a May 20, 2025 Cleburne City Council workshop, city staff presented a plan to issue certificates of obligation to fund road improvements, design work for a public‑safety facility and renovation of a city service center, officials said.

The staff presentation said the proposed issuance would fund approximately $7.2 million for road infrastructure, $5.4 million for architectural and design services for a planned public‑safety facility, and $2.9 million to convert and rehabilitate an underused city building into a one‑stop citizen service center. Jim Sabonis, the city—s financial adviser, told the council the package totals about $15.5 million for the tranche being proposed now; design and additional construction for the public safety facility would be brought to voters in a later election, with staff mentioning a target of 2026 for that vote.

The proposal uses Texas certificates of obligation, a debt instrument that staff said relies on a "double‑barrel pledge" of ad valorem tax revenue and the city—s credit rating. Sabonis said the team modeled a conservative 10‑year growth rate for assessed value, proposed amortizing the debt over 30 years and assumed interest at the city—s double‑A level plus 25 basis points. "We don't think there could be any impact on your I&S tax rate," Sabonis said during the presentation.

City staff and Sabonis said the approach is partly driven by proposed state legislative changes that could limit some uses of certificates of obligation in the future. Sabonis said some proposed bills would limit the ability to issue COs for design or renovations and could force certain debt onto the maintenance and operations tax side instead of the I&S side, which would affect budgeting.

Council members praised the conservative budgeting and the plan—s emphasis on minimizing tax‑rate impact. One council member, identified in the transcript as Councilman Jones, said, "Response times matter," in explaining support for advancing work on the public‑safety facility design prior to taking a larger construction question to voters.

Staff outlined next steps: the city—s attorney advised that the first formal action to begin the issuance process will be to publish a notice of intent at the council's next meeting; the transcript records that the notice of intent is expected to be scheduled for December 27. No ordinance or bond sale was approved at the workshop; the presentation was informational and staff requested direction to proceed to the formal notice step.

Officials said available ratings and current fiscal reserves give the city borrowing capacity. Sabonis described the city's credit profile, noting S&P and Moody's reviews and saying Cleburne's existing debt levels and cash balances underpin a strong rating. Sabonis also summarized that the city—s outstanding debt and projected new debt would remain low relative to local comparators under the model presented.

The council did not take a vote on issuing debt at the workshop. Staff said they will return to a future council meeting with the formal notice and with pricing information after the bonds are priced.

Timing and dollar figures were presented as estimates in the workshop. Where speakers used approximate language in the record, the article reflects those amounts as approximate.