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Bolivar moves ahead with BUILD-grant application for East Loop; staff outlines financing options and city share scenarios
Summary
City staff and bond counsel discussed general obligation bonds versus lease-purchase financing for the East Loop project; council approved a resolution to pursue a BUILD grant that could cover 80% of project costs, with a city match estimated in scenarios between $1.7 million and $3.6 million depending on scope.
The Bolivar Board of Aldermen approved a resolution to submit a BUILD grant application for the East Loop project and heard a detailed financing briefing from Gilmore and Bell.
Sarah Granath, of Gilmore and Bell, explained two primary financing mechanisms: general obligation (GO) bonds, which require voter authorization and permit a property-tax debt levy secured by the city’s full faith and credit, and lease‑purchase financing, which does not require voter approval but does not give the city authority to levy property tax and typically carries higher interest rates. "General obligation bonds... come with the ability to levy that property tax," Granath said, noting GO bonds often offer more favorable interest rates because of the pledged tax levy.
Granath advised the board to work with its financial advisor to model assessed‑valuation impacts and possible phasing. She noted tax-exempt bond proceeds generally must be spent within three years of issuance and that large projects are often issued in tranches to match construction phases and grant timing.
During Q&A council members asked how an approved GO bond would affect property owners, how cost overruns would be handled, and whether state infrastructure funds or private placements could lower borrowing costs. Granath said GO debt is repaid across all taxable property owners and overruns would be the city’s responsibility unless offset by other funding. On the question of how much the city might pay if awarded an 80/20 grant, staff presented three scenarios ranging from about $1.7 million on the low end to roughly $3.6 million as a higher estimate for the city’s share depending on scope and funding path.
Council approved Resolution 2026‑01 by voice vote; staff and council stressed that adopting the resolution to apply for the BUILD grant does not bind the city to accept funds or proceed without subsequent approvals and procurement steps.
Council directed staff to work with the city’s financial advisor and engineer to refine phasing and levy scenarios before any voter measure or formal debt issuance.
