Kankakee reports S&P upgrade and nearly $1 million in bond interest savings, officials say
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Summary
Bernardi Securities told the Kankakee City Council the city—s recent bond sale benefited from a Standard & Poor—s upgrade to A-minus and favorable market timing, producing lower rates than projected and roughly $1 million in aggregate interest savings across general obligation and sewer bonds.
Kankakee—s finance advisers told the City Council on Nov. 17 that a recent bond sale and a credit-rating upgrade produced lower-than-expected interest costs and material interest savings for the city.
Bob Veil of Bernardi Securities presented the city—s final pricing and said Standard & Poor—s upgraded Kankakee to A-minus during the process. "We have really good results to present to you," Veil told the council, noting that pricing came in better than projections established in July and September. He reported the general obligation bonds priced at about 4.41 percent and that the portfolio of issues reduced the city—s interest burden by roughly the amounts shown in the presentation.
Mayor, echoing the presentation, framed the savings as funding available for streets, public-safety vehicles and hydroelectric-plant work. "It—s not the sexiest things," he said of municipal finance work, "but the money that we—re buying the money for is, you know, new roads, the construction, fixing these things that way." He also said prior pension borrowing had reduced long-term pension costs.
Council members asked few substantive follow-ups; Veil walked through the sale timeline, the breakouts for a 20-year general obligation issue and a 12-year sewer issue, and presented the S&P rationale: improved financial reserves, consecutive operating surpluses, management stability and stronger financial policies, while noting ongoing pension liabilities as a credit challenge.
What happened next: Council members congratulated staff and asked administration to continue public outreach about uses for the savings. No formal council action was required on the presentation.
Why it matters: Lower borrowing costs free up annual budget capacity and can reduce pressure on tax rates and future debt issuance. The rating upgrade also broadens the investor base able to buy the city—s debt, Bernardi said.
Provenance: topicintro: SEG 135, topfinish: SEG 346.