Novi Council hears plan, timing options after voters approve $120M public safety bond

Novi City council on Aug. 25 heard a detailed briefing from project advisers on next steps for the $120,000,000 public safety bond that voters approved this summer.

City staff and advisers from PMR (Plant Moran/RealPoint), PFM (financial advisors) and Miller Canfield (bond counsel) reviewed project scope, procurement milestones and financing options. Todd Fenton of PMR summarized the program as one public safety headquarters (police and fire), two replacement fire stations and related site and road work, and said the team is moving into architect/engineer and construction manager selection. “We received proposals on August 12 and scored them that week,” Fenton said; the team intends to interview firms in early September and present finalists to the Finance & Administration Committee in October.

Sean Wall of PFM presented bond‑issuance scenarios intended to balance cash-flow needs and the city’s 1‑mill target. He described a base case (approximately $40 million issued in 2026 with the remainder in 2028) and alternatives that would pull more proceeds forward into 2027 to accelerate construction. “Option B looks at doing $25 million in 2026, pulling up $45 million in 2027 and rounding out $50 million in 2028,” Wall said, explaining tradeoffs between interest costs and inflation risk.

Pat McGough, bond counsel, told council the ballot authorized bonds not to exceed $120 million and that the 1 mill cited in ballot materials was an estimate, not a legal cap on annual levy. “You are authorized to levy whatever you need to pay debt service and not more,” McGough said, adding legal constraints on reimbursements and IRS timing rules: soft costs can be reimbursed from bond proceeds regardless of when paid, but hard costs generally must have been paid within 60 days before council approved the bond language.

Council members tested the advisers on timing, contingency and rate assumptions. Several members pressed for clearer graphics and historical context on long‑term muni rates; one asked specifically for a 25‑year AAA municipal comparison over the last 6–12 months. PFM said long rates are higher than a year ago and cautioned that moving issuance dates changes both interest accrual and investment earnings on proceeds. “When we talk about sharpening interest rates a quarter point, that may move capacity by a few million,” Wall said, and noted the city can earn investment income on proceeds that are then required to be spent on the project.

Advisers flagged regulatory items and site due diligence: geotechnical testing, easements, lot‑line and wetlands work on the public safety headquarters site; the city is finalizing due diligence on a parcel at 42000 West 13 Mile Road for one fire station and expects a September closing. Fenton said preliminary design is expected to start in the third quarter of this year with construction staged so that larger packages come later in the schedule; under current assumptions the main public safety building would be completed in 2028 with fire stations finishing in 2029, but the team is exploring ways to accelerate the 60‑month program.

Council directed staff to continue procurement work and governance planning, including a more detailed near‑term milestone chart and a responsibility matrix so members can see which decisions staff, consultants and council will make. The presentation closed for questions; staff indicated they will return with finalists for architect/engineer and construction manager recommendations in the fall.

What’s next: staff expects finalist interviews with council committees in September/October and formal contract approval by council in October for at least one consultant; the first bond proceeds are projected to arrive as early as May 2026 under the current schedule.