Memphis authorizes $60 million stormwater bond issuance and restructures wastewater capital funding

Memphis authorizes $60 million stormwater bond issuance and restructures wastewater capital fundingThe City Council has cleared the way for debt-financed investment in drainage systems and treatment plants, moving key projects at the Stiles and South facilities away from pay-as-you-go funding.

The City Council authorized the issuance of up to $60 million in Storm Water System Revenue Bonds to finance system improvements.

Funding for the South Plant expansion and Stiles wastewater treatment facility biosolids upgrades was shifted from capital pay-go to sewer revenue bonds.

MLGW and the USGS approved a joint-funding agreement totaling over $1 million for groundwater data collection.

The Council approved a $125,000 grant to Clean Memphis for clean water initiatives in drainage basins.

The Memphis City Council approved an initial resolution and series resolution authorizing the issuance of Storm Water System Revenue Bonds in an aggregate principal amount not to exceed $60 million during its meeting on January 13, 2026. Sponsored by the Administration, the bonds are intended to finance the costs of various improvements, additions, and extensions to the city’s stormwater system. In parallel moves affecting wastewater infrastructure, the Council approved resolutions amending the Fiscal Year 2026 Capital Improvements Program (CIP) budget to alter the funding mechanism for several major treatment projects. Architecture and engineering activities for the Stiles wastewater treatment facility biosolids upgrades and the South Plant expansion project were shifted from "Sewer Fund Capital paygo" to "sewer revenue bond financing." This funding source change also applies to the rehabilitation of existing sewer cover lines and ARP sewer competitive projects, signaling a strategic shift toward debt financing for these capital-intensive upgrades. Additionally, the Council approved a joint-funding agreement between Memphis Light, Gas & Water (MLGW) and the U.S. Geological Survey (USGS) Lower Mississippi-Gulf Water Science Center for the investigation of water resources. The agreement, covering the period from January 1, 2026, to December 31, 2027, stipulates that MLGW will furnish $916,000 and the USGS will provide $174,000 to continue the groundwater data collection program in the Memphis area. This monitoring effort complements MLGW’s broader 2026 water capital budget of approximately $75 million, which targets resilience through the construction of new production wells, distribution system upgrades, and improvements to pumping stations. On a smaller scale, the Council transferred $276,103.30 in construction funds to the Lillian Drainage Improvements project to upgrade the drainage system near Lillian Drive. A separate resolution provided $125,000 in grant funding from the Public Works Division to Clean Memphis for clean water initiatives to be performed in various city drainage basins.