Op-Ed from Mayor Jensen: Protecting our City’s Financial Future


Noblesville has experienced significant growth over the past two decades and is well positioned to maintain its momentum going forward. However, facilitating this growth requires investment in upgraded infrastructure, additional housing options, and other capital improvement projects that will benefit the community. The recent and continued growth of our city creates exciting new opportunities but also begs the important questions of how do we pay for such projects in a responsible way? 

While there is no universal answer as funding varies project-by-project, a fiscally responsible and common way cities fund major projects is with municipal bonds. As a general rule, I approach municipal budgeting in the same way I partner with my wife to manage our household budget – not spending more than we earn, not mortgaging our future, maintaining savings for unexpected expenses, and being good stewards of funds that we’re fortunate enough to earn or receive. We bring those same principles to the table when we work with city departments’ budgets that are funded by taxpayers.  One significant differentiation, however, between government debt and consumer debt comes from the state’s tax policy for local units of government. City revenues, comprised in significant part from property taxes, are generally much more stable than a single family’s income, and as such are considered much more secure from a financing risk perspective, which allows cities to borrow with much lower interest rates.  

A reasonable question that is often posed is why a local government unit that has cash reserves would use debt financing instead of paying cash up front for a project. For any major project, paying cash up front would first require the City to collect and hoard taxpayer money for years, stunting the growth and prosperity of our city by taxing citizens without reinvesting the money back into the community immediately. Instead, Noblesville and other cities can pledge portions of their property tax revenues to bonded projects that are paid off over time at extremely low interest rates. Additionally, many redevelopment and economic development projects involve debt repayment guarantees from private developers, meaning that the taxpayer risk is low or nonexistent while new housing, employment, and opportunities are being generated in our city.  All local governments’ outstanding bonds are audited regularly and reported to the State of Indiana and posted on the public Gateway for Government Units website to facilitate transparency and oversight.   

While some may see debt as a bad thing, when used correctly it can be an effective tool to help fast-growing communities, like Noblesville, fund projects while still keeping overall tax rates low. Using bonds enables Noblesville to fully utilize our growing tax base to continue expanding our public infrastructure to keep up with our growing population, like the upcoming Olio Road Improvements from 141st Street to 146th Street or the new Village at Federal Hill Commons, which will enhance our community long after the bonds are paid off. 

It is important to emphasize that I do not act alone in making these funding decisions. The city has a comprehensive strategy that is supported by dedicated members of my staff and validated by professional financial advisors. These professionals conduct sophisticated project-specific and overarching analysis to guide us on our decisions and to implement and refine our debt and fund management strategy. That strategy ensures that fiscally responsible decisions are made with the interests of taxpayers as their focal point.  Our project funding plans also are a collaborative effort with our Common Council and its finance, economic development, and roads committees. Noblesville is fortunate to have a council that gives fund usage proposals rigorous review and has a high level of financial sophistication and understanding. 

The combination of a growing tax base, debt limits, expert advice, and comprehensive community investment strategies makes our use of municipal bonds a highly responsible way to fund major projects. Now is an even more ideal time for the strategic use of debt since interest rates are at historic lows, minimizing the cost of borrowing. This approach enables Noblesville to accelerate its investment in public infrastructure, economic development projects and quality of life for all residents.  


Chris Jensen 

Mayor, City of Noblesville