FY 2017 Budget Highlights

IV. sufficient to pay debt service. TIF debt does not count against the legal debt limits and Debt Affordability guidelines. The County has a TIF policy to govern the establishment of the development districts, the application for the TIF debt proceeds and the issuance of the TIF debt. 2. The County may authorize Community Development Authorities (CDA) to fund public infrastructure in specified geographical areas. Special taxes levied on the benefitted properties fund this special obligation debt. Beyond the levy and collection of specific taxes, the County is not responsible for the debt service in the event of default. This debt does not count against the legal debt limits and Debt Affordability guidelines. 3. Revenue Bonds a. Revenue Bonds are secured by the pledge of particular revenues to their repayment. The revenues pledged may be those of a Special Revenue or Enterprise fund, or they may be derived from revenues received from or in connection with a particular project, all or part of which is financed from the proceeds of revenue bonds. b. Revenue Bonds are generally tax-exempt and structured to be self-supporting. Because they are self-supporting they are excluded from Debt Affordability calculations. C. Revenue-based debt generally carries a higher interest rate but allows a direct relationship between the cost of a project and the users who benefit from it. d. Under the Water and Sewer Act, the County may issue Revenue Bonds. The County needs separate bond authority to issue other Revenue Bonds. e. The County may issue economic development Revenue Bonds in its name for the benefit of certain private organizations that qualify for such participation. The conduit organizations assume all responsibility for repayment of the debt, for monitoring the use of the debt in accordance with Internal Revenue Service guidelines and for all post-issuance disclosures. This debt does not count against the legal debt limits and Debt Affordability guidelines and the County is not responsible for the debt service in the event of default. 4. Interfund Loans - Loans may be extended between funds of the County. In such an event, interest will accrue to the borrowing fund at least equal to the short- term interest rate the County receives on its idle proceeds. This rate shall be calculated monthly for any funds outstanding during that month. No interfund loans will be executed without a plan of repayment to the affected fund. C. Other Financing Mechanisms 1. Capital Leases - this form of financing is used regularly for the purchase of substantial equipment that may not qualify to be financed with General Obligation Bonds. The term of this form of financing is typically five to ten years. The equipment being purchased is sometimes the collateral for the leases. Capital Lease agreements are subject to annual appropriation. Debt Limits A. In accordance with Chapter 2-7-8 of the Code, the Board of County Commissioners (BOCC) cannot create any obligation or liability on the part of or on the credit of the County which shall be a floating debt, nor issue any certificate of indebtedness, nor shall 3

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