Resolution authorizing the execution, terms, issuance, sale and payment of general obligation refunding bonds in multiple series in an aggregate principal amount of not to exceed $825,000,000.

This resolution authorizes the Metropolitan Government of Nashville and Davidson County to issue General Obligation Refunding Bonds, Series 2026D, in an aggregate principal amount not to exceed $825,000,000. The primary purpose is to achieve debt service savings by refinancing existing general obligation debt.

Refunding Methods:

• Current Refunding: Approximately $162,340,000 of callable General Obligation Refunding Bonds, Series 2016, will be defeased. Proceeds from the new bonds will be deposited into an irrevocable escrow fund to pay these bonds on their earliest optional redemption date of July 1, 2026.
• Tender Offer: A portion of outstanding General Obligation Improvement Bonds (Series 2017, 2018, 2021C) and General Obligation Refunding Bonds (Series 2021B, Federally Taxable) will be targeted for cash purchase through a bondholder invitation to tender process. The tender offer expires March 20, 2026, with settlement on April 7, 2026. The purchase is contingent upon the successful issuance of the new 2026 Refunding Bonds and providing economic benefit to the Metropolitan Government.

Security & Financial Health: The new Series 2026 Bonds are direct general obligations, backed by the full faith and credit of the Metropolitan Government and payable from unlimited ad valorem taxes on all taxable property. The Metropolitan Government maintains a strong financial position, with a 45% median increase in property values from the 2025 reappraisal, leading to a new, lowest-in-history combined property tax rate of $2.814 per $100 of assessed value. The FY2026 Operating Budget is $3.8 billion, a 15.3% increase over FY2025, and includes significant investments, notably $45 million for a Unified Housing Strategy. The city adheres to a Fund Balance Policy requiring 17% operating reserves and 50% debt service reserves, plus a new 1-6% Sustainability Reserve. The bonds are expected to receive stable outlook ratings from Moody's, S&P, and KBRA.

Risks: Potential risks include the unadjudicated 2006 Charter Amendment limiting property tax increases, exposure to economic downturns, and contingent liabilities from various authorities (Sports Authority, Convention Center Authority, MDHA, Nashville General Hospital) which could draw on non-tax revenues.

This bond issuance aims to reduce the city's future borrowing costs by refinancing existing debt, potentially freeing up funds for other city services. The city's strong financial health, including a record-low property tax rate and significant investments in housing, schools, and public safety in the $3.8 billion FY2026 budget, directly benefits residents through improved services and community development.

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