Worthington City Council authorized the city to borrow up to $4.7 million for three capital projects through a single 20-year bond issuance: finishing the new outdoor pool and replacing aging water and sewer lines. The bonds are expected to carry an interest cost of about 4 percent, and council passed the three authorizing ordinances by unanimous roll-call vote at its May 18 meeting.
One borrowing, three projects
The three ordinances (11, 12, and 13-2026) authorize a single bond sale, broken into separate pieces of legislation because they cover different project types: up to $2.5 million for the outdoor pool, $1 million for sewer improvements, and $1.2 million for water improvements. The proceeds will fund the balance of the swimming facility now under construction, along with the design, engineering, and construction of sewer and water line improvements.
What the bonds will cost
Brian Cooper, a municipal advisor and principal with the firm Baker Tilly, presented the financing plan.
Key terms of the planned bonds:
The bonds will be issued for 20 years, maturing December 1, 2046.
They are general obligation limited tax bonds, secured by the full faith and credit of the city and repaid from the city's income tax revenue. Cooper called the general obligation pledge the "most credit worthy pledge the city can offer", which helps secure the lowest available interest rate. Each ordinance also formally levies a property tax as a backstop — but only any shortfall is collected, so under normal operations, when income tax covers the debt service, no separate property tax is levied for the bonds.
At current market rates, the city expects a true interest cost of about 4.01 percent. Cooper said rates are elevated because of global events, but the figure is "pretty much in line with the city's past issuances". The ordinances themselves cap the true interest cost at 6.00 percent — a legal ceiling well above the expected rate.
Average annual debt service is projected at about $355,000. The city will make an interest-only payment in 2026, followed by principal and interest payments each year through the bonds' final maturity on December 1, 2046.
The bonds will be tax-exempt. Starting December 1, 2036 — ten years after issuance, a standard call feature — the city will have the option to pay the bonds off early, which gives it room to refinance if interest rates fall.
Cooper also noted the city holds a AAA rating from S&P Global, the highest rating available, which he credited to the finance team's management and policies. The bonds will be sold competitively, with the sale awarded to the underwriter offering the city the lowest interest rate.
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Matching the debt to the life of the work
A council member asked staff to confirm that the projects would last at least as long as the 20-year debt. Staff said the water and sewer lines carry useful lives of roughly 40 years. Because the city is currently replacing lines that are about 100 years old, staff said the new infrastructure is expected to last even longer.
Spreading repayment over 20 years allows "every user and resident to pay their fair share" of the infrastructure over time, staff said. Keeping the term at 20 years also follows Government Finance Officers Association best practice for holding the city's overall debt burden low. The repayment length is set by a weighted-average formula under Ohio law. Although state law would have allowed the water and sewer bonds to be repaid over up to 40 years, the city chose the shorter 20-year term for all three projects.
What happens next
Cooper laid out the remaining timeline for the bond sale:
- The S&P rating was expected as soon as the week of May 18.
- The official statement, the disclosure document describing the bonds and the city's finances, is to be finalized June 1.
- Bond pricing is set for June 11, timed to avoid Federal Reserve meetings.
- Closing and funding are expected around June 24.