From October 3-9, 2018, the City of Madison will give residents the opportunity to invest in Madison’s future by purchasing up to $2.1 million in community bonds. By buying these bonds, investors can support their community’s collective goals with enhancements to critical community spaces, and earn federally tax-exempt interest at the same time.
“This partnership gives Madison area residents an opportunity to invest in one of the jewels of the City: Olbrich Gardens,” said Mayor Soglin. “Working alongside the capital campaign overseen by the Olbrich Botanical Society, this bond offering is another way to be a part of a facility that will serve all ages and demographics for years to come. I am excited to give our residents easier access to investing in our community and getting a good return on that investment.”
The City will use the proceeds from community bonds to build a dedicated education space and an environmentally friendly, efficient greenhouse in the Olbrich Botanical Gardens to meet the growing needs of the Madison community.
Rendering of the new Learning Center at Olbrich Botanical Gardens
Bonds are usually sold in $5,000 denominations, but here the City of Madison and Neighborly have decided to lower the denomination to $500 — one-tenth of the typical value — in order to democratize access to these investments and increase participation by community investors. In fact, priority will be given to investors in Madison, followed by investors in Dane County and then the state of Wisconsin, before the offering is opened up nationally.
“By providing smaller denominations than typical City debt offerings, Neighborly’s community bond program is in keeping with Madison’s long-standing commitment to civic action,” said David Schmiedicke, Finance Director for the City of Madison. “It will give our residents a much easier way to invest in our triple-A rated city and they can expect a solid return on that investment.”
The City will be holding two informational sessions to allow residents to ask questions about the new program. These sessions will be held in late September and early October and will be announced in the near future.
These Community bonds (official title: Promissory Notes, Series 2018D) will be allotted and orders will be filled on a first-come, first-served basis on orders up to $50,000. The minimum order size is $500 and there is no maximum. Orders over $50,000 are subject to pro-rata allocation if the issue is oversubscribed. Pro-rata allocations may be adjusted to ensure that no bonds are issued in an amount that is not divisible by the minimum denomination of $500.
These bonds pay tax-exempt interest at the federal level. These bonds will not be subject to redemption prior to maturity and their interest rate will be determined at the opening of the sale period.
Public information sessions will be held on Tuesday September 25 at 6pm at the Olbrich Atrium; and on Wednesday October 3 at 6pm at the Warker Park Community Recreation Center.
Interested in investing in Madison? You can learn more and sign-up at neighborly.com/madison