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Finance director: council can absorb debt for two bonds without immediate tax increases
Summary
Finance Director Carl Erlacher told the council the city’s debt-service schedule has capacity to absorb the two proposed bonds, noting 2026–27 should remain flat for taxpayers based on current authorized but unissued debt; he cautioned about future projects and the need to manage authorized-but-unspent borrowing.
Carl Erlacher, Middletown director of finance and revenue services, reviewed the municipal debt-service schedule and told council members that, under current assumptions, adding the $10 million 9-1-1 bond and the $48.9 million McDonough bond can be absorbed without raising taxes in 2026 or 2027. He said some projects will begin construction and interest-only payments may occur in early years, but long-term principal was modelled over 10-year schedules to limit taxpayer impact.
Erlacher noted that the city has $76 million in previously authorized projects that have not yet been borrowed and that adding further authorizations too quickly could change the debt profile. He recommended diligence and continued monitoring of the bond calendar and said the explanatory referendum text will be prepared for the September meeting so voters have complete information before absentee ballots and polling distribution.
