Mulberry commission approves $5 million loan to cover June debt, hires Pivot to pursue USDA and other funding

The Mulberry City Commission voted May 5 to borrow $5 million to cover a debt service payment due June 20, 2026, and approved hiring Pivot Business and Government Solutions to pursue USDA Rural Development and other funding avenues for the city's municipal complex project.

The motion to borrow $5 million was made by Commissioner Divine and seconded by Commissioner Barside; commissioners approved it by voice vote. The loan was described by staff and the city's financial advisor as a 10-year amortization designed to address an immediate obligation, while a separate $13 million financing option would have financed a first-phase vertical build but carried similar long-term fiscal constraints.

City Manager Ayala and financial advisors laid out the decision before the commission: cover the immediate $5 million liability or pursue a larger $13 million financing package to construct the first building. Jay Glover of PFM Financial Advisors and Mike Brennelson (Brennelson CPAs) presented amortization schedules showing similar net fiscal impacts across scenarios and warned the city would remain financially constrained under either option.

"Between either the $5 million and the $13 million options, the numbers are not that different," Jay Glover said during the presentation, noting the $13 million option included a longer amortization but a 10-year balloon. Mayor Hatch and finance staff emphasized the urgency to decide so bond counsel and the bank could finalize documents in time for the June payment.

Following the loan vote, the commission voted to retain Pivot Business and Government Solutions, represented at the meeting by Angela Prioleau, to evaluate and pursue eligible federal, state and private funding. Prioleau outlined a phased approach focused on USDA Rural Development's Community Facilities program: a pre-application to establish eligibility, a full application if authorized, underwriting and post-award compliance and reporting, and long-term loan closeout and covenant management.

Prioleau cautioned that prior site work'horizontal construction and environmental mitigation'can complicate USDA funding, but said waivers and carefully crafted justifications can sometimes allow projects to move forward. She described typical USDA terms for community facilities as long-term, low-interest loans (30—240 years) and said USDA quarterly interest rates can vary; she quoted a current USDA rate of about 4.75% as context for how Rural Development structures financing.

Commission discussion centered on whether to seek USDA financing after construction has started, whether components should be pursued as separate projects (city hall, cultural center/museum, police substation), and how any existing obligations affect USDA's "test for credit" and eligibility. Prioleau and the city's finance advisors advised that pre-application outcomes could require the city to pursue alternative funding sources if Rural Development declines to fund the project.

Commissioners also noted that Pivot's compensation includes milestone-based incentives and could reach six figures depending on outcomes; the commission approved the contract with that caveat.

The commission directed staff to proceed with the $5 million financing to meet the immediate obligation and to continue pursuing grant and low-interest options through Pivot and other funding avenues.

Next steps: bond counsel will finalize the borrowing documents with Citizens Bank to execute the $5 million note; Pivot will begin pre-application work and an assessment of alternative funding sources, including CDBG, historic-preservation and other state/federal programs as applicable.