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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 /> LI 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 4 of 10 <br />