Discussion and Review of FY 2026-2027 Budget

City of Tiffin Notes to Basic Financial Statements NOTE 3 – LONG-TERM DEBT (CONTINUED) A. General Obligation Bonds (Continued) On May 18, 2022, the City issued $2,740,000 of general obligation corporate purpose bonds to provide funds for various improvement projects and land acquisition. The bonds bear interest rates ranging from 2.35% to 3.5% per annum and mature on June 1, 2038. During the year ended June 30, 2025, the City paid principal of $175,000 and interest of $75,183 on the bonds. The outstanding principal balance at June 30, 2025, was $2,245,000. On May 30, 2024, the City issued $3,565,000 of general obligation corporate purpose bonds to provide funds for various improvement projects and land acquisition. The bonds bear interest rates 5% per annum and mature on June 1, 2032. During the year ended June 30, 2025, the City paid principal of $170,000 and interest of $178,745 on the bonds. The outstanding principal balance at June 30, 2025, was $3,395,000. On April 24, 2025, the City issued $5,350,000 of general obligation corporate purpose bonds to provide funds for various improvement projects and land acquisition. The bonds bear interest rates 4% to 5% per annum and mature on June 1, 2040. During the year ended June 30, 2025, the City paid principal of $0 and interest of $0 on the bonds. The outstanding principal balance at June 30, 2025, was $5,350,000. B. Revenue Notes – Direct Borrowing On September 30, 2016, the City entered into an agreement with the Iowa Finance Authority (IFA) and the Iowa Department of Natural Resources for the issuance of sewer revenue bonds of up to $2,296,000 with interest at 1.75% per annum. The agreement also requires the City to annually pay a 0.25% servicing fee on the outstanding principal balance. The bonds were issued pursuant to the provisions of Chapter 384.24A to finance construction of certain wastewater treatment facilities. The bonds mature June 1, 2037. During the year ended June 30, 2025, the City paid principal of $102,000 and interest of $25,935 on the bonds. The outstanding principal balance at June 30, 2025, was $1,380,000. On May 11, 2018, the City entered into an agreement with the Iowa Finance Authority (IFA) and the Iowa Department of Natural Resources for the issuance of sewer revenue bonds of up to $5,624,000 with interest at 1.75% per annum. The agreement also requires the City to annually pay a 0.25% servicing fee on the outstanding principal balance. The bonds were issued pursuant to the provisions of Chapter 384.24A to finance construction of certain wastewater treatment facilities. The bonds mature June 1, 2038. During the year ended June 30, 2025, the City paid principal of $302,000 and interest of $37,034 on the bonds. The outstanding principal balance at June 30, 2025, was $4,446,000. On March 4, 2022, the City entered into an agreement with the Iowa Finance Authority (IFA) and the Iowa Department of Natural Resources for the issuance of sewer revenue bonds of up to $486,000 with interest at 0% per annum. The bonds were issued pursuant to the provisions of Chapter 384.24A to finance construction of certain wastewater treatment facilities. The bonds mature June 1, 2038. During the year ended June 30, 2025, the City paid principal of $28,588 and interest of $0 on the bonds. The outstanding principal balance at June 30, 2025, was $371,648. The City has pledged future sewer customer receipts, net of specified operating disbursements, to repay $6,197,648 of sewer revenue bonds. Annual principal and interest payments on the bonds are expected to require less than 91% of net receipts. For the current year, principal and interest paid and total customer net receipts were $495,557 and $723,242, respectively. 22