Page 306 - CityofWataugaAdoptedBudgetFY25

DEBT SERVICE

system. Payments will begin in 2025 with $1,582,850 for the General Fund portion of the debt,
and approximately $275,000 for the Utility Fund.

The focus for future budgets will be on phasing in portions of the bond program and adopting a
combination of bond issuance and cash financing to fit within budgetary (tax rate) constraints.
Special consideration will be given to the leveling of City Debt.

Current Bond Ratings

In recent years, S&P Global Ratings assigned its ‘AA’ long-term rating to the 2019, 2020, 2021,
2022, 2023, and 2024 issuances and affirmed their ‘AA’ rating on the city’s certificates outstanding.
The rating is based on the City’s very strong reserves combined with steady budgetary
performance produced by a very strong financial management team. In addition, S&P cited
expectations for the city to continue stable operations and the projection for assessed values in the
city to continue growth.

Moody’s had assigned an Aa3 underlying rating to the City’s 2011 and 2012 Certificates of
Obligation issuances which have now been defeased through the refundings described above.

Debt Service and impact on operations:

The City’s debt service schedule is shown below. The City continues planned debt service
contributions to fund capital projects without tax increases when possible for General Fund
projects. The Utility Fund capital projects are generally planned in the year or debt service
declines in order to minimize the need to raise utility rates.

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