Finance director outlines three community campus financing scenarios and projected homeowner impacts

At a Committee of the Whole session held within the Jan. 20 council meeting, the city’s finance director presented conceptual financing scenarios for a potential community campus project and explained three strategies intended to limit taxpayer impact: (1) layer new debt as older facility debt is paid down; (2) structure 2026 capital borrowing to front‑load principal payments and reduce interest expense; and (3) use the closure of TID 3 to increase the city’s tax base and create capacity for additional debt service.

The presentation examined three illustrative project sizes: $65 million, $85 million and $110 million. Under the $65 million scenario staff projected a roughly flat or slightly declining equalized tax rate while showing an estimated $30–$40 annual increase on the median home because of rising home values; under the $85 million scenario the combined tax rate could remain approximately constant for 10 years; under the $110 million scenario staff showed a one‑time increase on the median home of roughly $173 in the first year under the assumptions used and lower increases thereafter.

Staff emphasized that these are conceptual estimates based on assumptions (20‑year tax‑exempt general obligation borrowing, an assumed 4% true interest cost with a 21‑basis‑point buffer, and projected valuation growth of 2% per year). Staff also acknowledged the need to model a wider interest‑rate sensitivity band and to provide a clearer, plain‑language table showing the cumulative per‑household cost over 20 years for public information. Ehlers, the city’s financial advisor, assisted with the analysis. Councilors asked for a clearer dollar‑impact per median home over the debt term to present to residents at public sessions. No council vote to proceed with a project occurred; staff will return with refined scenarios and updated sensitivity analysis.