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171 <br />172 <br />173 <br />174 <br />175 <br />176 <br />177 <br />178 <br />179 <br />180 <br />181 <br />182 <br />183 <br />184 <br />185 <br />186 <br />187 <br />188 <br />189 <br />190 <br />191 <br />192 <br />193 <br />194 <br />195 <br />196 <br />197 <br />198 <br />199 <br />200 <br />201 <br />202 <br />203 <br />204 <br />205 <br />206 <br />207 <br />208 <br />209 <br />210 <br />211 <br />212 <br />213 <br />214 <br />215 <br />216 <br />217 <br />218 <br />Debt Policy <br />Purpose <br />❑ To define the role of debt in the City's total financial strategy so as to avoid using debt in a manner <br />that weakens the City's overall financial condition. <br />❑ To establish limits on the amount of City debt which will allow for manageable debt service costs. <br />❑ To maintain the best possible Moody's and Standard and Poor's credit rating <br />Policy <br />❑ The City will confine long -term borrowing to capital improvements or projects that cannot be <br />financed from current revenues. The City shall not use debt for the purchase of vehicles and other <br />rolling stock <br />❑ When the City finances capital projects by issuing bonds, it will pay back the bonds within a <br />period not to exceed the expected useful life of the project <br />❑ The City will try to keep the average maturity of general obligation bonds at or below ten years <br />❑ The City will strive to keep the direct debt per capita and direct debt as a percent of estimated <br />market value at or below the median set out by the credit rating agencies <br />❑ Total general obligation debt shall not exceed two percent of the market value of taxable property <br />as required by State law <br />❑ The City shall not use debt for current operations <br />❑ The City will maintain good communications about its financial condition with credit rating <br />agencies <br />❑ The City will follow a policy of full disclosure on every financial report and bond prospectus <br />❑ Refinancing or bond refunding will only be undertaken when there is significant economic <br />advantage to the City, and when it does not conflict with other fiscal or credit policies <br />❑ The maintenance of the best possible credit rating shall be a major factor in all financial decisions. <br />For the purposes of issuing debt, bond rating categories shall be used as a means of assessing the <br />City's financial condition. <br />Implementation <br />The debt management section of this approved Budget and Capital Improvement Program demonstrate <br />compliance toward achieving the city's debt policy. <br />Page 7 of 13 <br />