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HomeMy WebLinkAbout15 Debt Issuance & Management Workshop WORKSHOP ITEM #15Management PolicyDebt Issuance and Management PolicyDebt Issuance and August 1, 2018 Debt Issuance and Management Policy debt financing involving third parties.This includes debt for maintenance projects, equipment, facilities, and •goalsdebt on the District’s This workshop item focuses •Reserve goals•Debt goals•Revenue goals•Planning goals•District Code Title 3.01 establishes the financial goals for the District•BACKGROUND / HISTORY Debt Issuance and Management Policy NEW INFORMATION Raley’sThe Railyard based financing-Several developers have asked the District about land•Development activity is up in Truckee•Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION Effective January 1, 2017•Specific District local goals and policies document required•Increased reporting requirements•Code section 8855 concerning public debtCalifornia Senate Bill 1029 implemented changes to Government •Updates to the District’s debt policies are recommended•Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION Internal control procedures •Policy goals related to the issuer’s planning goals and objectives•How the debt supports the issuer’s capital improvement plan•Types of debt that may be issued•Purposes for which debt proceeds may be used•a debt management policy that includesNew debt •Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION Refunding and restructuring outstanding debt•Priority for certain projects •Public purpose must be clearly articulated•based financings-Land•Finance capital facilities•Purposes for which debt proceeds must be documented•Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION Assessment districts•Community facilities districts•Certificates of participation•Revenue bonds•General obligation bonds•Types of debt that may be issued includes, but is not limited to:•Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION Useful life of the asset compared to debt term•Market conditions and District cash flows•Debt limits versus assessed value•Select best match for need and use of items financed•District shall review all funding sources•Policy goals related to the issuer’s capital improvement plan•District’s existing capital plansThe District should evaluate each request for financing based on the •How the debt supports the issuer’s capital improvement plan•Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION Savings of 3% net present value of outstanding debt•Refunding and restructuring outstanding debt•85% of bond proceeds spent within three years •Time limit for spending bond proceeds•Separation of duties•Payments authorized by General Manager or designee•Separate account for bond proceeds•Accounting procedures•Safety, Liquidity, Yield•All debt transactions approved by the Board•Internal controls over use of bond proceeds•Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION debt ratio minimum should be 4:1-to-Value•10% of the bond proceeds•125% of annual average debt service or•Reserve fund required for the lesser of•sale of 50% of units-Residential only projects require pre•leased or Letter of Credit-preCommercial and mixed use projects require 50% of rentable space •equityLetter of Credit may be required where one owner holds 25% or more •Proposed District equity requirements•Debt Issuance and Management PolicyDebt Issuance and Management Policy NEW INFORMATION Septembernext step is to bring a policy recommendation to the Board in The •management goals in accordance with policyFuture financing needs will be evaluated against District debt •1029policy changes are required by Senate Bill #Debt •Debt Issuance and Management PolicyDebt Issuance and Management Policy FISCAL IMPACT There is no fiscal impact associated with this workshop item•Debt Issuance and Management PolicyDebt Issuance and Management Policy RECOMMENDATION PolicyProvide input to staff on the District Debt Issuance and Management •RecommendationRecommendation