Debt

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Summary of City Debt

City Debt Summary (From FY 2024 Budget)

Credit Ratings Reports

As a part of the issuance of General Obligation Bonds, the City of Evanston’s credit rating is re-examined by recognized ratings agencies. The City is evaluated by Moody’sFitch Ratings, and Standard and Poor's (S&P) agencies. Prior to the issuance of new bonds, these agencies evaluate the issuer’s financial condition through a review of all published financial reports (audits and budgets) and through an interview of city management staff. The City of Evanston received a rating AA from S&P Ratings for the 2021 series bonds. 

 View 2021 agency rating information: S&P 2021 Rating

View 2020 agency rating information: S&P 2020 Rating | Fitch 2020 Rating

View 2019 agency rating information: Moody's 2019 Rating | Fitch 2019 Rating

Bond Issue Official Statements

Conduit Debt

The term conduit debt obligations refer to certain limited-obligation revenue bonds, certificates of participation, or similar debt instruments issued by a state or local governmental entity for the express purpose of providing capital financing for a specific third party that is not a part of the issuer’s financial reporting entity. Although conduit debt obligations bear the name of the governmental issuer, the issuer has no obligation for such debt beyond the resources provided by a lease or loan with the third party on whose behalf they are issued.

Conduit obligations generally are tax exempt, if they conform to relevant portions of the Internal Revenue Code. Thus, these financings are a way for not-for- profit organizations—for example, hospitals, nursing facilities, and educational institutions—to secure financings at tax-exempt rates. Third-party borrowers also may be other governments.

As a home rule municipality, the City of Evanston is authorized to issue tax-exempt bonds on behalf of certain non-governmental organizations for the purpose of financing certain manufacturing projects, health care facilities, educational facilities, and certain other qualified projects.  The issuance of tax-exempt bonds can achieve cost savings for such organizations versus obtaining a taxable loan.

Tax-exempt bonds are often structured similarly to a term loan or mortgage, and the interest rates vary based on the borrower’s financial situation, credit enhancements, method of sale of bonds and the current market.

As a conduit issuer, the City assumes no liability for the bonds or the payment of debt service thereon and the credit of the borrower determines the lender’s willingness to undertake the loan as well as the interest rates charged. The City’s lack of liability is generally established in the contract or related financial documents

So far, City of Evanston has acted as “conduit issuer” in two cases including Chiaravalle school and Roycemore school.

 Educational Facility Revenue Bonds, Series 2011, Roycemore School Project

Roycemore Conduit Debt Refinancing - 2021