Madison begins sale of ‘community bonds’ to support Olbrich Gardens expansion
Starting Wednesday, Madison will begin a seven-day offering of so-called “community bonds,” sold in increments as small as $500, to generate $2.1 million to help pay for $12 million in improvements at Olbrich Botanical Gardens on the East Side.
The bonds, sometimes called mini-bonds, are a way for citizens to invest in the city’s future while earning tax-free interest at the same time.
An information session is set for 6 p.m. Wednesday at Warner Park Community Recreation Center, 1625 Northport Drive.
Typically, investment banks facilitate the sale of large pieces of city debt — often tens of millions of dollars at a time — in $5,000 increments that mature in 10 or 20 years. The banks market the debt to institutional and individual investors, mutual funds and others.
Those bonds, however, are out of reach to many smaller investors and the sales don’t build a sense of community ownership by investors to specific projects. Community bonds offer much smaller increments, shorter maturation and direct marketing to investors focused on a geographical area for sale such as a city, region or state.
From Wednesday through Oct. 9, Madison will sell up to $2.1 million in bonds on a first-come, first-served basis on orders between $500 to $50,000.
The city is issuing the bonds through broker-dealer Neighborly Securities of San Francisco. Those interested can register a Neighborly account now and use it to place orders. Anyone can purchase the bonds, but if they sell out, they will be issued first to city residents, followed by residents of Dane County, Wisconsin and the United States.
The Olbrich project includes a two story, 8,500-square-foot Learning Center, to be located off the existing main lobby on the garden side, with flexible space that can be converted from one to three classrooms, demolishing the current 9,600-square-foot greenhouse for a more efficient one roughly the same size, and other improvements.
The $12 million cost would be split between the city and the private Olbrich Botanical Society, which jointly run the gardens at 3330 Atwood Ave., near Lake Monona.
The community bond initiative provides an opportunity for city of Madison residents to contribute to the project in a different way than the traditional tax-deductible contributions to the Rooted & Growing capital campaign, Olbrich director Roberta Sladky has said.
Additional information is available online at www.cityofmadison.com/community-bonds.