Ald. Manaa-Hoppenworth Votes Yes to Pass $830 Million Bond Ordinance
Dear Neighbors,
On Wednesday, I voted yes to pass the $830 million bond ordinance to fund the city’s Capital Improvement Plan. This funding will support 150 miles of street resurfacing, 150 blocks of new street lighting, lead service replacements, sewer main upgrades, and other essential infrastructure improvements that we all rely on.
Here in the 48th Ward, the Capital Improvement Plan includes essential infrastructure projects such as:
An $8 million sewer main and lead service replacement project that will increase sewer capacity and help address longstanding flooding issues along Glenwood
The long awaited $1.3 million Pedestrian Hybrid Beacon at Wayne and Ridge
Over $1 million in ADA improvements including Accessible Pedestrian Signals on Devon, and sidewalk and ADA ramp repairs throughout the Ward
Our $1.5 million Menu Program and Participatory Budgeting Projects including street and alley resurfacing, green alleys, and more.
You can read more about all of our 48th Ward infrastructure projects here.
For more information about the Bond Ordinance, I would like to share a helpful Op-Ed from our Chairwoman of the Committee on Finance. Read it in full below.
Yours in Community,
48th Ward Alderwoman Leni Manaa-Hoppenworth
Op-Ed: Setting the Record Straight on Chicago’s Capital Bond Issuance
By Pat Dowell, 3rd Ward Alderman and Chairman of the Committee on Finance, City of Chicago
Recent discussions surrounding the City’s general obligation bond issuance, including Alderman Conway’s Chicago Tribune editorial questioning its timing and scope, require a clearer understanding of the facts. While scrutiny of public finance decisions is always welcome, mischaracterizations of the City’s fiscal plan do a disservice to the residents and businesses that depend on critical infrastructure funded by municipal bonds.
Let’s set the record straight. The $830 million bond issuance is a responsible and strategic investment. It aligns with standard municipal fiscal practices and more importantly, it funds the City’s Capital Improvement Plan (CIP). This plan strengthens our neighborhoods, drives economic development, and enhances citywide infrastructure. It also ensures that every community is able to address their local needs by repaving streets and alleys, updating street lighting, upgrading sidewalks and ADA ramps, replacing lead service lines, and more. This multitude of projects will have lasting benefits for generations to come.
Furthermore, the repayment of this bond is not rocket science. It’s in-line with the standard payment schedule for Capital Bonds, and mirrors how the city has paid off these types of bonds in years past. Repayment of any bonds issued this year will be included in the 2026 budget. And the specific two-year delay in payments is simply a consequence of how the budget and levy years interact. As an example, the 2025 budget authorized the 2025 levy, which will be collected in 2026 and be used to pay debt service due July 1, 2026, and January 1, 2027. All that to say, the payment schedule for this year’s capital bond doesn’t stray from the City’s recent practices which have been acceptable to the rating agencies and bond investors. For example, the City’s Series 2024A Bonds followed a broadly similar plan as the proposed bonds being discussed herein. Moreover, the City’s Series 2023AB Bonds followed a similar structure with the majority of principal coming due further in the future. Those structures did not result in credit rating changes or result in poor investor feedback. On the contrary, the credit rating agencies and bond investors understand that the City structures individual debt financings and refinancings in order achieve optimal results for taxpayers in the aggregate. Also, the City’s bond transactions, particularly those financed during the past few years, have wisely included a provision that gives the City the option to refinance. This is a common best practice that will give us the option to accelerate repayment if interest rates are favorable.
The City needs to balance capital investment with managing the City’s pension and debt liabilities. The City manages the amortization such that annual costs for debt grow at a manageable pace for taxpayers. Accelerating the amortization of the City’s bonds will lower the total interest costs, but will also require the City to budget for steeper annual spending increases. The City must invest in our capital infrastructure continuously to meet the needs of our residents. There will be opportunities for the City to issue and refinance bonds that are paid more quickly as we secure revenues and manage our budget to that end.
Infrastructure Investments Are Essential and Responsible
The assertion that Chicago should pull back on borrowing in response to recent credit rating adjustments ignores the reason for the downgrades: The Kroll and S&P downgrades were driven by the budget process, including the rejection of the property tax increase, and the continued use of one-time measures to balance the budget. Borrowing for capital projects already factors into rating agencies’ expectations and does not introduce new risks to the City’s credit standing. The City’s financial team replicated the rating agencies’ own methodologies to confirm that this borrowing would not cause additional downgrades.
Alderman Conway’s Op Ed also ignores the fundamental purpose of capital investment: maintaining and improving the physical assets that support daily life. Deferring infrastructure maintenance only compounds financial burdens in the long term, leading to higher costs, greater liabilities, and diminished quality of life for residents. Municipalities across the country borrow for infrastructure projects because these costs are substantial and distributing them over time ensures that future generations who benefit from streets, water lines and public buildings also contribute to their funding.
The City is prioritizing spending on essential public works projects - including needed public safety infrastructure improvements to several Chicago Police Department locations and Chicago Fire Department stations. Projects like these will improve City services, reduce long-term maintenance costs and create local jobs that stimulate economic growth.
A Transparent Bond Issuance Process
As part of this bond issuance, the City is following rigorous financial oversight and industry best practices to secure competitive interest rates and maximize taxpayer value. Our debt issuance strategy remains disciplined, balancing the need for continued capital investment that supports basic human needs and business community expectations with careful consideration of taxpayer and budget impact.
The $830 million figure represents a not-to-exceed limit, allowing flexibility to size the bond issuance appropriately based on prevailing market conditions. The size of this debt offering is in line with recent historical bond offerings our city has done over the past decade despite credit ratings being lower than they are now. From 2015 through 2022, Moody’s had the City rated at a below investment grade (Ba1). In that time period, the City issued $2.5 billion in debt. Since Moody’s upgraded the City to investment grade in November 2022, we have issued an additional $1.2 billion of capital bond debt and maintained a positive outlook from Moody’s.
Moving Forward with Fiscal Responsibility and Investment in Chicago’s Future
The City remains committed to fiscal responsibility, transparency, and long-term sustainability. We are taking decisive action to maintain essential City services, invest in infrastructure, and strengthen our financial position. Aldermen and stakeholders should evaluate this bond issuance on its merits, recognizing the necessity of capital investments to keep our city moving forward.
During times of political uncertainty, it is important to encourage infrastructure investments now. We cannot afford to wait on the State or Federal government to carry out this critical work, it’s on us to do it here at home. Chicagoans deserve infrastructure that is safe, functional, and forward-thinking. That is exactly what this bond issuance will help deliver. It is time to move past unfounded concerns and focus on building a stronger, more resilient Chicago.