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CFO: planned borrowing and reserves position Weatherford to support capital plan
Summary
City CFO Don Brooks reviewed outstanding city and utility debt, projected reductions in certain debt service payments, and said the proposed rate plan would generate revenues to cover increased debt service tied to planned bond issuances and rehab needs.
Don Brooks, Weatherford’s chief financial officer, gave the board a debt‑schedule update tied to the rate study and the city’s broader capital plan.
Brooks said the city currently has five outstanding bond issues totaling about $62.2 million (about $49.5 million principal and $12.7 million interest) and that the utility system has two outstanding bond issues totaling about $26.7 million (about $22.2 million principal, $4.5 million interest). He said those city and utility debts are issued and serviced separately, with different credit ratings and revenue sources.
Brooks told the board the city currently pays roughly $9.3 million annually in tax‑supported debt service and that scheduled maturities will reduce some payments in future years (staff cited a sizable reduction anticipated in 2027 and further changes by 2029). He said the rate study’s financing assumptions — which staff presented as roughly $165 million in debt for water and wastewater over the planning horizon — would raise average annual utility debt payments to about $10.8 million, an increase of about $6.4 million compared with current annual debt service.
Brooks framed the change as manageable under the proposed rate plan: "The proposed rates in the rate study will generate sufficient revenues to meet those obligations," he said, adding that reserves, liquidity and a consistent record of adjusting rates ahead of spending helped sustain the utility's credit profile.
He reviewed recent S&P activity: the city holds a double‑A stable rating affirmed in January; the utility system has an upper‑medium A+ rating with a positive outlook, and S&P has signaled potential for an upgrade in the next review if future debt issuance performs as expected.
Board members discussed debt term length and lifecycle costs. Board member Walter urged the board to consider the cumulative cost of different term lengths and future issuance on top of existing debt; she estimated a multi‑year differential in interest costs when comparing shorter versus longer term strategies and urged caution about assuming no future significant capital needs.
Next steps: staff will include the debt schedule with the draft rate ordinance presented at the joint utility board/city council meeting and will outline policy choices for debt term and issuance timing.
