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DeKalb panel approves preliminary plan to issue about $150 million in tax anticipation notes
Summary
The Finance, Audit & Budget Committee voted to approve a preliminary resolution authorizing up to $150 million in 2026 tax anticipation notes to cover expected interim cash shortfalls, and directed staff and financial advisers to solicit bids and return with a final recommendation to the full board on April 28.
The DeKalb County Finance, Audit & Budget Committee voted to approve a preliminary resolution authorizing the issuance and sale of tax anticipation notes (TANs) for 2026, with advisers estimating a maximum interim cash deficit near $150 million.
The committee motion (item 0504) cleared the committee by voice/hand vote after a presentation from PFM financial adviser Elise L., who described TANs as short-term, tax-exempt borrowings local governments use to bridge the gap between regular expenditures and once-a-year property-tax receipts. "Based on the 2026 cash flows that we have seen thus far, the maximum deficit that we are looking at is about near 150 million," Elise said.
Why it matters: County operating revenues are concentrated in property taxes, which arrive in a narrow window each year. PFM showed months in which expenditures exceed receipts and said the size of the TAN depends on reserves and the timing of receipts and payments. Committee members noted that building larger reserves would reduce future TAN needs and issuance costs.
What the committee asked for: The committee authorized staff to proceed with a competitive private placement process and bid solicitation; final approval of the winning bidder, the interest rate and the precise amount will be returned to the Board of Commissioners on April 28. The committee’s action today was the preliminary approval required to solicit bids.
Fiscal context: PFM emphasized that federal tax rules and a 5% working-capital buffer factor into the calculation of allowable TAN size. Members asked staff to ensure the TAN sizing follows those constraints and to run the detailed cash‑flow calculations with bond counsel. A committee member noted the county policy target of only one month of operating reserves and that at least six months would be needed to avoid future TANs entirely; county staff said the CEO has pledged a four‑month reserve target by the middle of the CEO’s term and that increasing reserves will reduce future borrowing.
Next steps: Staff and PFM will take bids, return to the full Board on April 28 with a recommended winning bidder and final terms, and close the borrowing shortly thereafter.
