Kansas City voters will decide on two big-dollar water system questions in the Aug. 4 primary election — whether to let the city borrow up to $750 million to fix and expand its waterworks system, and another $750 million for its sewer system.
What You Need To Know
The bonds would be repaid solely from money KC Water already collects from customers, and that repayment method is built into the ballot language. Neither question would raise taxes.
KC Water told the City Council in May that if the measures fail, the department would have to turn to more expensive debt, which would lead to higher rate increases than planned.
Previous Bond Authorizations
Kansas City voters have seen — and approved — requests like these before. Kansas City voters passed a $500 million water bond authorization by roughly a 4-to-1 margin in 2014. Similarly, voters passed a $750 million sewer bond authorization by 79.49% in 2022.
Voters are being asked to authorize new revenue bonds because that previous borrowing authority is nearly used up on the waterworks side, and is largely spoken for on the sewer side. Meanwhile, water and sewer projects that need funding remain.
How The Bonds Work
A revenue bond is similar to a loan. Money is borrowed, then repaid from the revenue of the thing the loan built — in this case, from your monthly water and sewer bills — rather than from taxes.
By law, KC Water can’t issue revenue bonds without voter permission. KC Water calls revenue bonds a “financing tool” that it has used for decades.
Impact On Water And Sewer Bills
Passing the bond authorizations doesn’t trigger a rate increase. The cost of this borrowing is already baked into KC Water’s rates and long-term financial plan.
A “no” vote could mean higher water and sewer bills. According to KC Water, rejecting the bonds in question would mean that planned projects would still need to be done, but would be paid for using other financing options that would be more costly to the utility.
Original reporting: The Beacon (Kansas City) — read the source article.
