Manteca is borrowing $57 million to help pay for the combined $94.8 million needed to build a new police station and the city’s sixth fire station.

Details of how the two projects are being financed will be discussed Tuesday when the Manteca City Council will be asked to issue revenue bonds.

The final projected overall cost of the police station — furnishings included — is $75 million. That is down from the projected $92 million when the city started exploring police department needs and options 14 months ago.

The final projected overall cost of the sixth fire station — interior equipment included — is $24.8 million. That is up from the rough estimate of $12 million when planning started in earnest more than two years ago.

The city has $35.8 million in growth fees on hand that can be used toward the projects — $30 million in government building facility fees for the police station and $5.8 million in fire impact fees for the fire station.

There is a $64 million funding gap once the impact fees are applied.

The city is also using $6.3 million it set aside in Measure Q funds to repay a bond that will lower the upfront cost of the two projects to $57.7 million.

Going forward, the repayment of the revenue bonds that coincide with the end of the 20-year Measure Q sales tax is now expected to around $5 million annual.

Those annual repayments could theoretically be covered all, or in part, by growth fees collected for fire impact and government facilities on new homes as they are built.

In a worst case scenario if there was zero growth going forward roughly a third of Measure Q’s annual generation of $15 million to $17 million in terms of 2026 dollars would be needed to retire the debt.

The city still has a significant amount of government facilities fees in place to help fund an additional project such as a community center.

The $57.7 million Manteca will receive from the bond sale will be at a 4.9 percent interest rate.

There is a $653,912 finance charge upfront for the bonds that will mature June 1, 2045.

The average annual debt service is $4,867,884.59.

Once the $57.7 million bonds are paid off, the city will have paid $90,312,781.07.

Staff notes that the proceeding numbers are good faith estimates only and are based on market rates as of Oct. 5, 2026. Final results will likely differ based on market conditions as of the actual sale date and other factors. However, for the financing to proceed, the not-to-exceed parameters described in the previous section must be met.

Those not-to-exceed parameters are:

*Not more than $65 million in principal.

*The true interest cost not exceeding 5.50 percent.

*The underwriter’s discount not exceeding 0.45 percent of the principal.

The sale of the bonds is expected to occur in late October or early November.

The city will receive the bond funds by the end of November.

To contact Dennis Wyatt, email dwyatt@mantecabulletin.com