Page 115 - PowerPoint Presentation

DEBT SERVICE FUNDS OVERVIEW

Town Council and staff are dedicated to a conservative pattern of debt issuance that ensures property
tax rates remain attractive to prospective businesses and residents. Prior to acquiring any debt,
alternative financing sources are evaluated. When debt is issued, it is used to acquire major assets with
expected lives which equal or exceed the average life of the debt issue.

The Town’s debt service funds are comprised of the revenue supported Debt Service Fund 300 and
property tax supported Debt Service Fund 301. Debt Service Fund 300 is used to manage payments on
all general government related debt. Debt Service Fund 301 is property tax supported debt for street
infrastructure improvements, Westlake Academy Expansion, and funding the Westlake Academy’s Arts
& Sciences Center.

DEBT SERVICE PROCESS

DEBT MANAGEMENT POLICIES
The Town’s debt management policies are reviewed annually and revised as necessary. The Town’s
policies address the following:
 Direct Debt - debt payable from property tax (or ad valorem I&S tax), and other available funds
of the Town.
 Interfund Borrowing – loans for short-term cash flow needs.

LIMITS
The Town’s only legal limit to debt is the tax rate limit.

ANALYSIS
Any consideration of debt issuance for major capital assets are prepared within the framework of a
Council approved multi-year capital improvement plan and forecast for all Town facilities and
infrastructures.

Staff explore alternative funding sources prior to the issuance of debt for capital acquisitions and
construction projects. These alternatives include, but are not limited to:

 Grants-In-Aid
 Use of Reserves
 Use of either current on-going general revenues or one-time revenues
 Contributions from developers or others
 Leases
 User Fees
 Impact Fees.

If debt is determined as the funding source it is presented to Council for approval.

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