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3 <br />Debt Management and Capital Funding Policies <br />In the mid-1990's, Commissioners and staff recognized the need for the County to have in <br />place formal policies regarding the County s debt and capital funding. The existence and <br />observation of these formal written policies helps not only to promote the County's <br />creditworthiness with bond rating agencies and investors, but also to schedule funding for <br />expensive major projects in a logical, stepwise approach that precludes major fluctuations <br />from year to year in capital revenue requirements. A copy of the County's Debt <br />Management Policy is provided as Attachment 6 of this abstract and a copy of the County's <br />Capital Funding Policy is provided as Attachment 7. The adopted policies have served the <br />County well and have been major contributing factors to the County's current excellent bond <br />ratings of AA+ with Standard and Poors, Aa1 with Moodys and AAA with Fitch IBCA. <br />Staff solicits any comments the Board may have about changes to the existing policies that <br />Commissioners believe may he appropriate. Any such changes, along with several staff <br />proposed changes, will be brought back for the Board's consideration in preparation for the <br />2005 -15 CIP cycle. <br />FINANCIAL IMPACT: As was explained during the public information campaign leading up <br />to the November 2001 bond referenda, the cumulative debt service impacts from the plan <br />for bond sales and alternative financing could range from 7 to 10 cents on the property tax <br />rate, depending on size, timing and prevailing interest rates. The annual cast of debt service <br />associated with the first issuances of debt equated to about 1,2 cents per $100 of assessed <br />valuations. Projected future tax rate impacts would depend mainly on how the Local <br />Government Commission structures debt service payments over the coming years, It is <br />important to note that all planned debt issuance is in accordance with the County's current <br />debt management policy and well within the parameters established therein. <br />RECOMMENDATION(S): The Manager recommends that the Board: 1) review and amend, <br />if needed, the list of projects and amounts to be included in the updated debt issuance <br />schedule; and 2) provide other guidance to staff as appropriate on capital and debt <br />management issues. <br />