NORMAL — Nearly 20 years after the town of Normal celebrated becoming debt-free, officials have no plans to do it again — and laud the growth a nearly $94 million debt load has brought the community.

"Sometimes you miss opportunities if your only goal is to be debt-free," said Mayor Chris Koos, whose tenure coincides both Normal's rising debt and the rebirth of downtown as uptown.

"Most of the debt we've incurred has really driven economic development in the community, although we've done infrastructure debt as well," he said. "It's all about being proactive."

The story of Normal's debt, for the most part, is the story of uptown. Fifteen years after that effort started, about $75 million of Normal's $85 million in general obligation bonds can be traced there, said Finance Director Andrew Huhn — from the town-owned Children's Discovery Museum to incentives and infrastructure for private projects, including the Marriott and Hyatt Place hotels.

As Koos pointed out during a debt-focused mayoral campaign in 2017, $85 million in town borrowing for uptown brought $145 million in private investment there — which he noted has not only improved quality of life, but boosted town sales and property tax revenue.

"(Without uptown) we would have had less debt, for sure. Would we have had no debt? No. We would have had to eventually do something. The downtown area degrading wasn't sustainable," said Huhn. "If that core part of the community is failing, it affects all of our revenue sources."

Today, Normal has an unusually high debt load for a city its size, but a revitalized core and still-sturdy finances overall, said Huhn.

Bloomington, by comparison, has $91 million in obligations, but only $57 million in general obligation bonds, and its per-capita debt is $1,162, versus $1,725 for Normal.

The town knows, however, exactly which funding sources will pay down that debt — a mix of taxes, including property, sales, hotel/motel and food and beverage — and what large projects it still has on the horizon.

"It has to be a thoughtful process, and that's probably the first best practice," said Huhn. "If you're issuing debt under emergency circumstances or your planning is not about long-term needs ... then you're on unstable ground."

Shortly after Mayor Kent Karraker recognized the town's final debt service payment in December 1999, he acknowledged it was in part an effort to free up borrowing capacity for a huge project like uptown that would be well-planned and, potentially, highly lucrative.

Officials are taking a similar planning-oriented approach now. The town's current debt has paid for not only a $8 million fire headquarters station at 606 S. Main St. but a $1.4 million study of a potential railroad underpass.

That extends to Normal's next likely bond-funded project: another fire station, to continue replacing aging stations and realign them for better response times. That included moving a station from 604 N. Adelaide St. to Main Street and is expected to include two more moves.

"It makes sense to issue debt for something that's going to be around for 30 to 40 to 50 years," said Huhn. "It's completely a yes answer for that, assuming you've got the funding set aside, which we will do."

In the long term, officials aren't sure what the town's debt should be.

The town measures its debt versus assessed value that has stayed between 9 and 11 percent since 2009; official financial reports use indicators including percentage of personal income and debt per capita; and auditors use other metrics, some of which are proprietary and never fully explained publicly.

"For all intents and purposes, too much is when we don't have a revenue stream to support it, or when we can't maintain our current financial stability," said City Manager Pam Reece.

What projects might be debt-funded, however, is a matter of debate. Koos has said repeatedly neither a railroad underpass nor a sports complex, two pricey proposals the town has paid consultants to study, will proceed without substantial outside funding.

"When we were looking at the Main Street corridor, we were quite clear for that development it could not be like uptown was. We didn't have the capacity to do that again," said Koos.

He noted the town continues to have a AAA bond rating, which tells lenders the town is an extremely good bet to pay back its obligations, and that its 5.2 percent debt-to-budget ratio would be exceptional for a home or business.

Huhn and Reece acknowledged, however, there's always a tension between borrowing and keeping taxes and fees as low as possible. The town has increased its property tax rate each year since 2006, including a 6.38 percent increase this year, and sewer and trash fees are set to rise over the next few years, in part to address the town's lingering budget issues.

"That's a very high-level policy discussion for Pam and the council about priorities. It's tough to answer," said Huhn. "These are really difficult long-term decisions to make about the direction of a community."

Contact Derek Beigh at (309) 820-3234. Follow him on Twitter: @pg_beigh