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DEBT SERVICE FUNDS DESCRIPTION: The Debt Service Funds repay the outstanding debt obligations of the:City of Gem Lake. Debt service. funds use the modified accrual basis of accounting; however, the cash. basis Of accounting will be used for budgetary purposes only. The cash basis is used.for budgeting to ensure that sufficient cash will be available to make required. payments on the City's bonded indebtedness. GOALS: Retire all debt in a timely basis as scheduled. MEASURABLE WORKLOAD DATA: 20144 2015 2016 2017 ACTUAL ACTUAL ACTUAL ESTIMATED Bond Rating Non -Rated Non -Rated. Non -Rated Non -Rated Dec. 3.1 Debt Outstanding. (in thousands} $760 $745 $775 $715 Net Debt:PerCapita $1,914 $1,877 $1,942 $1,525 DEBT LIMITATIONS: All Minnesota municipalities (counties, cities, towns and school districts} are subject to statutory "net debt"limitations under the provisions of Minnesota Statutes, Section 475.53. Under this provision, the legal debt limit is 3.0% of the assessor's market value of the municipalities' tax base. Bond issues covered by this Iimit are those that are financed by property taxes unless at least 20% of the annual debt service costs are financed. by special'assessments or tax increments. At present the City has one bond issue that is subject to the debt limit: the 2007 Capital. improvement Plan Bonds. In 2015 the City issued the:.2015 G. O. Refunding Bonds to retire the 2007 Capital Improvement Plan Bonds in 2016. The City's current legal debt limit and debt margin is as.follows: Legal Debt Limit (3%.of. Estimated Market Value) $39118.1485 Less, Outstanding Debt Subject to Limit (775,0001 Legal Debt Margin as of January 1, 2017 $2,343;485 BUDGET COMMENTARY: The City's debt consists of a capital improvement plan bond for the construction of Heritage Hall which 34