Commerce council starts public‑notice process for $8.5M certificates of obligation

Commerce City Council voted to direct publication of notice of intent to issue Series 2026 certificates of obligation after a presentation from Hilltop Securities and city staff.

Jorge of Hilltop Securities described a proposed $8.5 million financing package structured so that about $6 million would fund water and sewer infrastructure and $2.5 million would support other capital projects. He said the firm recommended a “RAP” amortization structure to minimize early years’ payments and budgeted a conservative 4.72 percent interest rate (with a 25‑basis‑point cushion) to account for market volatility.

City staff noted the financing will support the city’s wastewater treatment-plant replacement—the last major item in the utility capital plan—and discussed debt-service-coverage impacts. The manager said the city’s water/sewer system is currently profitable and can absorb the projected $6 million without raising utility rates, while debt-service coverage would decline from about 1.78 to roughly 1.2–1.3 under the new issuance, short of typical industry targets around 2.5.

Jorge said the current step in the process is publishing notice and completing statutory requirements; if the council directs staff to proceed, Hilltop will work with rating agencies and bring a final transaction to council on June 16 with a potential close in mid‑July.

Council adopted the resolution to publish notice of intent by voice vote.

What's next: Publishing the notice starts the required public-notice period; staff will return with a final financing proposal and specific terms for council consideration in June.