Page 393 - City of Westlake FY20 Budget

Section 11 Municipal Policies
Municipal Fiscal & Budgetary Policies

• Should such use reduce the balance below the appropriate level set as the objective for that
fund, recommendations will be made on how to restore it.
• The Council shall approve all commitments by formal action. The action to commit funds must
occur prior to fiscal year-end, to report such commitments in the balance sheet of the
respective period, even though the amount may be determined subsequent to fiscal year-end.
• A commitment can only be modified or removed by the same formal action.

VII. DEBT MANAGEMENT
A. Debt Issuance Analysis - All consideration of debt issuance for major capital assets will be
prepared within the framework of a Council approved multi-year capital improvement plan and
forecast for all Town facilities and infrastructure.

B. Analysis of Debt Issuance and Debt Issuance Alternatives - Staff will explore alternatives to the
issuance of debt for capital acquisitions and construction projects.

These alternatives will include, but not be limited to,
• grants- in- aid
• use of reserves
• use of either current on-going general revenues or one-time revenues
• contributions from developers and others
• leases
• user fees
• impact fees

C. Use of Debt Financing - The useful life of the asset or project shall, at a minimum, exceed the
payout schedule of any debt the Town assumes. Debt financing instruments to be considered by
the Town may include:

• General obligation bonds - These must be authorized by a vote of the citizens of Westlake.
• Revenue bonds - These bonds generate capital requirements necessary for continuation or
expansion of a service which produces revenue and for which the asset may reasonable be
expected to provide for a revenue stream to fund the debt service requirement.
• Certificates of obligation - These can be authorized by Council approval with debt service by
either general revenues or backed by a specific revenue stream or a combination of both.

• Lease/purchase agreements - These shall only be used to purchase capital assets that cannot
be financed from either current revenues or fund balance/retained earnings and to fund
infrastructure improvements and additions.

D. Assumption of Additional Debt - The Town shall not assume more tax-supported general purpose
debt than it retires each year without first conducting an objective analysis as to the community's
ability to assume and support additional debt service payments.

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