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San Juan approves certificates of obligation and refunding bonds to fund projects and ease utility strain

City of San Juan City Commission · April 15, 2026

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Summary

The commission approved two financing items: new-money certificates of obligation (about $2.7 million) and a refunding of roughly $6 million of existing debt. Financial advisers recommended a 15-year fixed Lone Star bid for new money and a Frost bid for the refunding to reduce near-term pressure on the tax rate and utility fund.

The City of San Juan moved forward with two financing measures aimed at funding capital projects and refinancing existing debt.

Financial advisor Bobby Veria (Estrada & Estrada) told the commission the city offered two competitive solicitations in recent weeks: new-money certificates of obligation of roughly $2.7 million and a refunding of approximately $6 million of outstanding debt. Veria said several institutions bid; Lone Star offered a 15-year fixed term for the new-money certificates and Frost submitted the best refunding bid (about 3.6% for a nine-year refunding). Veria recommended taking the Lone Star bid for the new-money issue — “the bird in the hand” — and using Frost’s bid for the refunding to give the city more breathing room on debt service.

Veria also explained that the refunding structure was selected to avoid a tax-rate increase and to reduce near-term strain on the utility fund by pushing some payments slightly later. Staff said the required payment level would hold at about 23 cents (as presented in the packet) and that the structure is intended to accomplish projects without raising the tax rate immediately.

After the presentation the commission voted to approve both the certificates of obligation and the general obligation refunding bonds. Both motions carried by voice vote; no roll-call tallies were read into the record.

The approvals authorize staff to proceed with issuance and delivery consistent with the terms presented; staff said debt service estimates and project lists are included in the financing packet.