Page 262 - CityofSouthlakeFY25AdoptedBudget

DEBT

What you should know about the City’s Debt Management

AAA

Debt Service
2.52% Some debt is necessary Our debt management Voter-approved special
and appropriate to
strategies receive
tax levies have been
If all taxing entities hold ensure intergenerational a rigorous annual pledged to pay for
their tax rates steady equity. In other words, review from bond bonds used to construct
for FY 2025, 2.52% of paying cash for 100% of rating agencies tasked facilities identified in the
the total tax bill for capital projects would with letting potential City’s parks and trails
an average residential front-load the cost borrowers know how master plans, as well as
property will go to of 20-year assets on credit-worthy the public safety facilities.
support the City’s annual today’s taxpayer. city is. Right now the
debt payments. This City has three AAA
ratings — a strong
is equivalent to $482 external endorsement
annually or about $40 of the City’s financial
per month. management.

Strategies Three highlights

about FY 2025 Debt

1. Property tax supported debt per capita
reduced: Through the City’s use of cash
and aggressive amortization schedules
when debt is issued, the City has reduced
$92M 100% the property tax supported debt per capita
from $3,506 in 2010 to $954 in 2025.

2. Self-Supporting debt reduced: Through
Since 2006, the City has The City uses aggressive the City’s use of cash and aggressive
used the Strategic Initiative amortization schedules. As amortization schedules when debt is issued,
the City has reduced the total
Fund to pay cash for capital such, initial debt payments self-supporting debt from $148,515,869 in
projects. Approximately may be higher, but 2010 to $79,749,271 in 2025.
$92 million has been borrowing costs are lower
allocated for this purpose. and debt is paid off more 2. Long-Term debt as a percentage of
assessed valuation reduced: Through
This means less borrowing. quickly. All of the existing the City’s use of cash and aggressive
Additionally, this use property tax supported amortization schedules when debt is issued,
of cash funding when debt will be paid off in less the City has reduced the total long-term
combined with aggressive than 10 years. debt as a percentage of assessed valuation
amortization schedules from 3.01% in 2003 to 0.21% in 2025.
has allowed the City to
reduce its total outstanding
property tax supported
debt by 66% since 2010.

262 FY 2025 City of Southlake | Budget Book