Collier boosts borrowing cap to $300M for growth

To fund burgeoning growth in eastern Collier County, commissioners approved temporarily borrowing up to $300 million from a state pooled-loan program as gap funding before issuing bonds. 

The Board of County Commissioners unanimously voted April 14 to raise the limit from $200 million under the Florida Local Government Finance Commission’s Pooled Commercial Paper Loan Program. The additional capacity will serve as interim funding for the Northeast Interim Facilities Program and the Wastewater Regional Treatment Plant Expansion Project before the county issues long-term, fixed-rate bonds. 

“To date, no draws have been made,” Katrina Lin, the county’s Public Utilities Department financial operations manager, told commissioners before the vote. “Projects have continued on a cash-funded basis.” 

Lin outlined three key benefits of the program, saying it helps bridge timing gaps between project spending and long-term financing or revenue collection, does not require immediate borrowing but preserves access to funding and provides flexible, low-cost, short-term financing that can be refinanced when rates are favorable. 

The county’s Annual Update and Inventory Report identified significant funding gaps for stormwater and transportation projects between 2026 and 2035, driven by continued population growth. The borrowing limit was previously raised from $50 million to $200 million in October. 

Consultants PFM financial advisors, based in Naples, and Raftelis, a Charlotte, North Carolina-based firm specializing in utility management, recommended increasing the borrowing cap. The County Finance Committee reviewed those plans, the county’s rate study and recommended the loan. 

The Northeast Utility Expansion Program is a multiphase infrastructure initiative designed to extend essential utility services, potable water, wastewater and irrigation-quality water to rapidly growing areas in northeastern Collier. It supports new residential and commercial developments east of the existing service area, ensuring long-term capacity for future growth. 

In total, the county is investing more than $438 million in water and wastewater infrastructure expansion, with projects expected to be operational by 2031. Plans include a 6 million-gallon-per-day wastewater facility and a 10 million-gallon-per-day drinking-water plant using advanced membrane filtration to serve communities, including SkySail, Rivergrass Village and other pending eastern developments. 

Because the financing is pooled, borrowing costs and interest rates are typically lower than other loan options. Commercial paper loans are short-term, fixed-rate instruments ranging from one day to 270 days, according to a memo from County Utilities Finance Director Joseph Bellone. The loan will be secured by a subordinate pledge and lien on water and sewer system net revenues. 

For fiscal years 2026 and 2027, estimated funding needs for the Northeast Interim Facilities Program and the Wastewater Regional Treatment Plant Expansion Project are about $395,534,000. Of that, Bellone wrote, about $37 million is available from county sewer bond proceeds, resulting in a funding gap the commercial paper loan program would cover. At the current interest rate of 3.45%, including all fees, he wrote, $300 million would cost about $10.35 million in annual interest. 

Bellone wrote that the loan may be prepaid with 45 days’ notice without penalty, with remaining balances expected to be refinanced through long-term, fixed-rate bonds.