Finance director outlines city debt, TIF performance and $14M supplemental fund with projected 2028 pressure

Finance Director Melissa Cabrera briefed the council on the city’s debt portfolio Monday, reviewing enterprise and governmental debt, recent bond issuances and a TIF (tax increment financing) supplemental fund designed to cover underperforming TIFs.

Cabrera said most debt categories declined through fiscal year 2025 as the city made scheduled payments, but loans and bonds payable rose because of a 2025 public safety bond issuance that financed fire and police projects. She described two finance purchase obligations — a Caterpillar equipment lease and a Motorola radio system lease — noting the Caterpillar lease will be paid off this fiscal year and the Motorola lease remains with less than $600,000 in principal outstanding.

On business‑type debt, Cabrera reviewed Power & Light series (including a 2016D issuance structured with interest‑only characteristics to level debt service) and noted the water and sewer issues have seen principal pay‑downs since issuance. Cabrera said the event center carries roughly $76,000,000 outstanding and is paid primarily through a CID that produces enough revenue to cover debt service; the CID was said to run longer than the bonds, leaving residual capacity when the bonds retire.

Turning to TIFs, Cabrera reviewed three project areas: CenterPoint (TIF payoff 2028, approved 2004), Crackernet Creek (about $73,600,000 bonds outstanding; payoff 2051) and Santa Fe (about $6,800,000 bonds outstanding; TIF terminated 2023). She said the city’s outstanding TIF loans payable recorded in the ACFAR are about $90,200,000 and contrasted that with a 2014 table that listed about $165,000,000, describing that reduction as significant progress in paying down obligations.

Cabrera described the TIF supplemental appropriation policy adopted in 2021 with bond counsel and Baker Tilly. She said the policy prescribes financing the supplemental fund through voluntarily directed legally available new revenues — identified categories included general sales tax, street sales tax, parks and stormwater revenues — and that the fund cannot be used for operations. Cabrera said the supplemental fund balance is $14,000,000 and that preliminary forecasting indicates the first debt‑service supplement may be needed in fiscal year 2028 when unreserved fund balances could decline for certain TIF funds.

Council members questioned refinancing rationale, bond structure choices and the potential statewide policy changes that could affect local revenue. Cabrera cautioned that proposals discussed at a Missouri Municipal League event — including the possible elimination of the state income tax and options the state could use to replace revenue — could complicate long‑term forecasting and materially affect local sales and property tax collections, but she emphasized there were no concrete state actions yet and monitoring was ongoing.

Cabrera closed by summarizing a general obligation bond issued after fiscal year end with a face value of $27,780,000, an interest‑only first year payment due March 1, 2026, and the first principal payment due March 1, 2027; the tax levy for that issuance was set at $0.18 per $100 of assessed value for tax year 2025. She also noted the city’s financial position has strengthened, with unreserved general fund balances exceeding the council’s 16% minimum.