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Waco staff present plan for $100M‑plus 2026 certificates of obligation to fund water, streets and other CIP projects
Summary
City staff asked council to authorize parameters for up to $110 million of Certificates of Obligation to fund a roughly $100.36M project fund deposit for the 2026 CIP, covering water/wastewater, Better Streets Waco, bridge reconstruction and Fire Station #8 design; presenters said the issuance would raise total outstanding debt from ~ $1.0B to about $1.1B.
City financial staff and outside advisors presented the next step in Waco’s 2026 debt issuance on Jan. 20, asking council to authorize a parameters order to support Certificates of Obligation of up to $110 million to fund capital projects included in the adopted 2026 CIP.
Presenters said the project fund deposit for this issuance is roughly $100.36 million and includes multiple priorities: water and wastewater system investments (enterprise debt totaling roughly $55.68M in the presentation), Better Streets Waco rehabilitation ($34.2M), bridge reconstruction (~$6.5M) and Fire Station #8 design (~$1.1M). Staff noted that some golf course and other projects included in the tax‑supported piece would be supported by their own revenues.
Financial advisors outlined the city’s current debt profile—just over $1 billion in outstanding principal—and said the planned issuance would increase that to about $1.1 billion. Illustrative pricing shown to council used recent market yields with a sample true interest cost around 3.99%, and an average life of the bonds near 12.2 years; staff emphasized rates are market‑sensitive and that final pricing will be set at the February pricing date with a March close.
Staff also reviewed two highlighted consent agenda construction contracts: a $10.7M contract to TTG Utilities for a downtown quiet‑zone project and a just‑under $60M construction contract with Greycon to expand the Bull Hide wastewater treatment plant (and an additional $2.3M for CDM Smith construction phase engineering monitoring), increasing capacity from about 4M GPD to an ultimate 16M GPD and extending through approximately 2029.
Presenters said credit ratings (reported as Aa1 and AA+) and proactive CIP communication support market execution. Key dates cited were pricing in late February and a target close around March 19; staff said they will return with a parameters ordinance on the regular agenda for formal action.
