Willard's sewer bonds: $8.63 million outstanding, with principal scheduled through 2045

Willard's only bonded debt is a sewer revenue bond whose principal payments were deferred in a 2015 refunding, according to its fiscal 2025 audit. ^[1]

The city issued sewer revenue bonds in December 2008 to build its sewer system. The audit describes them as non-interest-bearing bonds, scheduled to mature in 2040, with the first payment due in 2012. In 2015 they were refunded with Series 2015 bonds of $10,740,000. "The purpose of the refunding was to defer principal payments further into the future as growth has come in below expectations," the audit says. ^[1]

The repayment schedule

The city paid $287,000 in principal in fiscal 2025, reducing the balance from $8,920,000 to $8,633,000. The sewer fund reported no interest expense for the year. ^[1][2]

Scheduled principal is $298,000 for fiscal 2026, $310,000 for 2027 and $345,000 for 2030. It is $1,924,000 for 2031 through 2035, $2,314,000 for 2036 through 2040 and $2,788,000 for 2041 through 2045. ^[1]

Reserves and coverage

The bond terms require several reserve accounts. The audit reports that on June 30, 2025, each had its required balance: $47,625 for operations and maintenance, $298,000 in the sinking fund, $358,080 in the reserve account and $244,079 for emergency repair and replacement. ^[3]

The bonds also require the sewer fund's net revenues to equal at least 125% of annual debt service. The audit's schedule reports $1,198,068 in revenues, including $716,778 in operating revenues, $122,009 in interest, $14,112 in connection fees and $345,169 in impact fees, and $526,006 in operating expenses excluding depreciation. That leaves net revenues of $672,062, or 226% of the $298,000 due in the coming year. ^[4]

The schedule labels that payment "2008 Bonds"; the debt note says the 2008 bonds were refunded with the Series 2015 bonds. ^[4][1]

Growth and the sewer fund

Impact fees are one-time charges on new development. The sewer fund collected $345,169 of them in fiscal 2025, and the audit reports $487,458 of the sewer fund's net position as restricted for impact fees and $1,042,559 as restricted for debt service. ^[2][5]