The Indianapolis City Council's Municipal Corporations Committee convened on August 7, 2025, to discuss a significant financial proposal from the Health and Hospital Corporation (HHC). The proposal, identified as number 213, seeks approval for the issuance of general obligation refunding bonds totaling up to $150 million. This move aims to refinance existing obligations tied to the construction of Eskenazi Hospital and address associated costs.

Joe Glass, the executive director and general counsel of the Indianapolis Bond Bank, presented the proposal, highlighting that the bonds would carry a maximum interest rate of 6.5% and maintain the same maturity date of January 2040 as the current bonds. Currently, approximately $141 million remains outstanding from the original bonds issued in 2010, which were part of a broader initiative following a successful voter referendum.

The proposal also includes plans to refund lease rental bonds issued by the Indianapolis Marion County Building Authority, which total around $328 million. While this aspect of the refunding does not require council approval, it has been discussed in previous meetings with relevant boards.

A key driver behind this refunding initiative is the uncertainty surrounding federal subsidies for Build America Bonds (BABs). Since 2013, these subsidies have faced reductions due to sequestration, impacting the financial landscape for municipal issuers. The proposed refunding is expected to free up approximately $33.8 million currently allocated for cash debt service reserves, resulting in annual savings of about $2.45 million for HHC.

The committee is set to seek full council approval in the upcoming August meeting, with plans to finalize bond pricing in September. This strategic financial maneuver aims to mitigate risks associated with fluctuating federal subsidies and enhance the fiscal stability of the Health and Hospital Corporation.