Page 239 - Saginaw FY19 Annual Budget

CITY OF SAGINAW
DEBT MANAGEMENT POLICY
2018-2019

(continued)

DEBT FINANCING POLICIES

 Total general obligation principal debt will not exceed 5% of the Taxable Value.

2018 Taxable Value $1,843,457,430
x 5%
$ 92,172,872

10-1-18 Outstanding GO. Debt $ 30,715,000

 Where possible, the City uses certificates of obligation, special assessment,
revenue bonds, or other self-supporting bonds instead of general obligation bonds.

 The City will strive to limit general obligation annual debt requirements to 35% of the
general government expenditures.

2018-2019 General Fund
Operating Expenditures $ 15,636,120
x 35%
$ 5,472,642

The 2018-2019 annual debt requirement is $3,392,610. This is within the 35% goal outlined
above.

The 2018-2019 budget includes debt service payments for debt currently outstanding as shown in
the Debt Service Fund section of the budget.

The City of Saginaw will use debt financing when it is appropriate. It will be judged appropriate
only when the following conditions exist:
 When major long-term capital improvements are desired.
 When it can be determined that future citizens will receive a benefit from the
improvement.

When the City of Saginaw utilizes long-term debt financing it will ensure that the debt is soundly
financed by:
 Conservatively projecting the revenue sources that will be utilized to pay the debt.
 Financing the improvement over a period not greater than the useful life of the
improvement.
 Determining that the cost benefit of the improvement, including interest cost, is positive.

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