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Finance director proposes paying off Series 2014 bond to lower future levy
Summary
Finance Director Rosa Cojulun told the Finance Committee she will recommend paying the Series 2014 bond principal of $40,750,000 at the December board meeting to avoid roughly $18.7 million in interest and reduce future property tax levy pressure while preserving village reserves.
Rosa Cojulun, the Village of Bolingbrook finance director, told the Finance Committee the department plans to propose at the December village board meeting that the village pay off the outstanding principal on the Series 2014 bond, $40,750,000, rather than continue annual levy increases to service that debt.
"This will allow us to lower the levy in future years," Cojulun said during the committee meeting. She told trustees the bond carries about $18,744,000 in remaining interest obligations and that paying the principal now would avoid those interest payments in future years and reduce pressure on the general fund.
Cojulun said the payoff plan would leave roughly $72,753,000 in reserves and recommended the village maintain about $50,000,000 in reserves to avoid cutting services. She warned that if the payoff is not completed by next year the village could face substantial debt-service pressure that would require service reductions or larger levies; she also estimated a levy reduction of about $3,000,000 for the next year if the payoff is executed.
Chairman Michael Carpanzano asked that the Finance Committee review the detailed proposal in December before it goes to the full village board. No formal board vote occurred at the committee meeting; Cojulun said the department will bring formal documentation to the December Finance Committee meeting and then to the board.
