Goodyear council reviews plan to use $37M of one‑time funds to pay callable bonds and free $5–6M annually

Finance Director Jared presented a refunding strategy to the Goodyear City Council on Dec. 9 that would dedicate one‑time funds to retiring callable debt to free ongoing revenue for the FY2026 budget.

Jared said the city has about $57 million in total annual debt service and roughly $10 million supported by the general fund. “We are here tonight to discuss a strategy of dedicating 1 time funds to paying off some debt and thereby freeing up some ongoing sources for other purposes in the '26 budget,” Jared said. He identified four debt issuances that include callable amounts that total about $37,000,000.

What the plan would do: Jared explained that reserving or using $37 million in one‑time resources (or defeasing debt) could free roughly $5–6 million a year in ongoing debt service beginning in the late 2020s, depending on which issues are called (he highlighted the Series 2016A at about $27.5 million callable in 2027 and Series 2021 reserve of about $9.8 million). Staff estimated the move could save about $7 million in interest overall, with roughly $4 million attributable to the 2016A payoff.

Council questions and fiscal tradeoffs: Council members asked about timing and current versus projected interest rates; Jared said an interest‑rate analysis has not yet been completed and the decision would be scheduled with callable dates around FY2027 or later. Several council members supported further study while urging caution so one‑time funds used to retire debt would not displace prioritized capital projects. A council member later identified in the transcript as Council member Bridal urged continuing the work: he noted available unassigned fund balances (staff reported an unassigned balance of about $29.9 million and a contingency of roughly $25.4 million) and encouraged staff to “do the math” to confirm the savings and impacts before a final decision.

Outcome and next steps: Council expressed support in principle for pursuing detailed analysis and for incorporating options into the FY2026 budget process, but took no binding vote. Staff will perform further financial modeling, include debt‑service and CIP impacts, and present recommendations as part of the budget deliberations.

Context note: The proposal is framed as a policy choice—using limited one‑time resources to convert recurring debt obligations into freed operating capacity—so the council must weigh near‑term reserve use against long‑term operating flexibility and capital needs.