FY 25 Adopted Budget | Página 228

Long-Term Debt Program

Rapid growth challenges a local government ' s ability to meet the service demands of residents . Growth creates a demand for quality infrastructure and facilities . Citizens will need more parks , community facilities , sidewalks and greenways , water , and sewer , etc . Normally , however , there is a time lag between the demands of growth and the corresponding increase in revenue collected from taxes , fees , etc . This produces a need to finance public facilities , infrastructure , and equipment .

Financing of these capital costs can be accomplished through various financing sources , which may include bonded debt , pay-as-you-go financing , installment financing , and public-private ventures , as prescribed by State law .

The Town of Garner ' s primary objectives in debt management are : �

To keep the level of indebtedness within available resources . When the Town of Garner 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 and financing the improvement over a period not greater than the useful life of the improvement . Long-term borrowing will be confined to capital improvements that cannot be financed from current revenues ; and

� To manage the issuance of debt obligation such that :

1 . Direct net debt as a percentage of total assessed value of taxable property should not exceed 2.0 %

2 . The ratio of direct net debt service expenditures as a percent of total governmental fund expenditures should not exceed 15 % with an aggregate ten-year principal payout ratio target of 50 % or better .

The Town ' s current bond ratings are AAA by Standard and Poor ' s and Aa1 by Moody ' s Investors Service .

Town of Garner ’ s Debt Rating History

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