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Managing Our Debt 2012 Annual Town Meeting Debt Presentation. R. Hill Committee on Finance and Taxation.

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Presentation on theme: "Managing Our Debt 2012 Annual Town Meeting Debt Presentation. R. Hill Committee on Finance and Taxation."— Presentation transcript:

1 Managing Our Debt 2012 Annual Town Meeting Debt Presentation. R. Hill Committee on Finance and Taxation

2 Total Town Debt ( As of Jan 1 st, 2012) $34,230,496. Source: Treasurer/Collector, Town of Stoughton

3 Authorized and Unissued Debt (Potential Additional Debt Liability) $21,506,095 (Includes Library Appropriation of $14,000,000) Source: Statement of Indebtedness; FirstSouthwest, June Authorized and Unissued Debt a/o June 20, 2011 Unfunded Borrowing Authorizations

4 Debt Budget FY 2013 Breakdown DepartmentsPrincipleInterestTotal Town$1,352,330$374,750$1,727,080 School$1,309,467$384,272$1,693,739 Water$575,033$225,221$800,254 Sewer$398,335$133,718$532,053 Ambulance$64,000$10,070$74,070 Cedar Hill$9,000$4,800$13,800 Total$3,708,165$1,132,831$4,840,996 * Source Treasurer/Collector, Town of Stoughton. Pages 5, 6, 8, & ATM Warrant

5 Retirement of Debt FY Department (Budgeted) Town$1,307,460$1,198,520$1,727,080 School$1,305,100$1,242,800$1,693,739 Water$363,340$334,580$800,254 Sewer$280,100$276,100$532,053 Ambulance$59,000$49,000$74,070 Cedar Hill$9,000 $13,800 MWRA/MWPA Misc.$499,081$514,191NA $3,823,081$3,624,191$3,708,165 * Source Treasurer/Collector, Town of Stoughton.

6 Sources and Funding ATM Articles - Funding Sources Recap All Articles Requested $ 14,164, FINCOM Approved $ 6,330, Funding Sources - Fincom Approved Articles Article AppropriationReimbursements Funding Net of Reimbursements General Obligation (GO) Borrowing $ 2,470, $ 990, $ 1,479, Enterprise Fund Borrowing $ 2,545, $ 900, $ 1,645, Cash $ 940, $ - $ 940, CPA Funded $ 375, $ - $ 375, Total Approved $ 6,330, $ 1,890, $ 4,440, Net Borrowing = General Obligation Borrowing + Enterprise Fund Borrowing Less Reimbursements $ 3,124, Reimbursements Betterments - Sewer Enterprise $ 500, Loan Repayment - Sewer Enterprise $ 400, MSBA Feasibility Study - Schools $ 566, MSBA Windows - Schools $ 424, Total Reimbursements $ 1,890,500.00

7 Formula: Total Debt/Pay down Rate = Number Of Years $34,290,496/*3,708,165 = 9.24 Years * Pay down Rate Based on 2013 Budgeted Principle Payments How Long to Pay Off Our Debt If No Additional Borrowing?

8 Moody’s Investors Service Stoughton Bond Rating Aa2 Legend: “ Obligations rated Aa are judged to be of high quality and are subject to very low credit risk”. Source: Moody’s Rating Symbols & Definitions, June Moody’s Investors Service Town Of Stoughton Bond Rating

9 I. Economic StrengthII Financial Strength III. Management & Governance IV. Debt Profile Moody’s Rating Criteria Source: Moody's Rating Methodology. General Obligation Bonds Issued by Local U.S. Governments. October 2009

10 “Moody's believes that the town's 1.2% overall debt burden will remain manageable given rapid amortization of principal (87% repaid within 10 years) and limited long-term borrowing plans”. Source: Moody's Rating Methodology. General Obligation Bonds Issued by Local U.S. Governments. October 2009 Moody’s Comment

11 - Maintaining structural balance and increase reserves -Increase in tax base, assessed valuation or demographic profile Source: Moody’s Global Credit Research, Town of Stoughton-02-May 2011 “What Can Make Ratings Go Up”

12 - Decrease in reserves -Inability to maintain structural balance Source: Moody’s Global Credit Research, Town of Stoughton-02-May 2011 “What Can Make Ratings Go Down”

13 Goal: - Maintain or Reduce The Town’s Debt Burden While Maintaining Town Services and Assets Some Objectives: -Maintain Borrowing at or Below Pay Down Rate -Maintain Borrowing 3-5% of Revenues -Grow Revenue Strategy

14 The End 2012 Annual Town Meeting Debt Presentation. R. Hill – Committee on Finance and Taxation


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