Board authorizes about $225 million in SRF bonds to support water projects

The South Dakota Board of Water and Natural Resources voted Feb. 26 to adopt a series resolution authorizing the issuance of approximately $225 million in state revolving fund (SRF) program bonds (Series 2026 A/B). Staff said the bonds will be marketed in mid‑March with a closing the week of March 30.

According to staff, the planned issuance breaks down between two series: 2026A (taxable) — intended to provide roughly $1,500,000 in clean water state match and $7,500,000 in drinking water state match to meet EPA capitalization grant matching requirements — and 2026B (tax‑exempt) — intended to provide $125,000,000 for drinking water leverage and $75,000,000 for clean water leverage. Staff described the total SRF package as about $225 million.

Bond counsel Bruce Bonjour said the resolution is in standard form and described several parameters staff intends to include in the final documents: a limit on annual debt service so that no year exceeds $25,000,000 in debt service; caps on yields and interest rates (taxable bonds not to exceed 6%, tax‑exempt not to exceed 6.5%); taxable maturities not to extend beyond 2036 and tax‑exempt maturities not to extend beyond 2056; and underwriting terms that require underwriters to pay at least 99% of the par amount with an underwriter discount cap of 1.5 percent. "This resolution is in what I consider to be a standard form for us," Bruce said.

The board voted to approve the series resolution. Staff and counsel said officers will be authorized to accept the winning bid within the stated parameters and to proceed to closing without further board action if bids meet the parameters.