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Sterling Commission authorizes generator project and bond authority up to $3 million
Summary
The Commission authorized proceeding with a three-megawatt generator purchase and approved an ordinance granting authority to issue up to $3,000,000 in GO bonds to finance the project; the Generation Recovery Rider (GRR) is the dedicated revenue source and the bond sale is scheduled for October 2026.
The Sterling City Commission approved an ordinance authorizing the Generator Project and granting authority to issue General Obligation bonds not to exceed $3,000,000 to finance a Caterpillar Tier 4 three-megawatt generator. City Manager Ian Hutcheson explained the generator purchase price is $2,500,000 with estimated installation and contingency costs of $350,000 (total estimated project cost $2,850,000). The City previously approved a Generation Recovery Rider (GRR) charge, billed per kilowatt-hour, which began in September 2025 at $0.013/kWh and was designed to provide revenue sufficient for a 15-year issuance.
Spencer Fane partner Andrew Kovar was available by teleconference to answer legal questions. Hutcheson said Piper Sandler prepared a calendar for a Series 2026 GO Bond sale scheduled for October 5, 2026, with expected closing October 29, 2026, and that estimated debt service on a $3,000,000 issuance over 15 years is $4,351,177 (average annual payment $290,078) using a 5.125% interest assumption. The Commission reaffirmed its desire for a 15-year maturity and voted 5-0 to approve the ordinance (motion by Commissioner Todd Rowland, second by Commissioner Bob Boltz).
