Res 2008-123 - Laserfiche WebLink

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3. Certificates of Obli at.? ion (CO's) and Limited Tax Notes (Notes) -Certificates of obligations will be issued to fund major capital projects which are not otherwise covered under either General Obligation Bonds or Revenue Bonds. Notes will be used in order to fund capital requirements which the useful life does not exceed seven (7) years as authorized by State law. Debt service for CO's or Notes maybe either from general revenues or backed by a specific revenue stream or streams or by a combination of both. The term of the CO's will not exceed the useful life of the major capital projects funded by the certificate issuances and will generally be limited to no more than twenty years. Neither CO's nor Notes require a vote of the citizens of the City. 4. Method of Sale -The Director of Finance will use a competitive bidding process in the sale of bonds unless the nature of the issue or market conditions warrant a negotiated sale. In situations where a competitive bidding process is not elected, the Director of Finance will publicly present the reasons why and will participate with the City's Financial Advisor in the selection of the underwriter or direct purchaser. C. Analysis of Financing Alternatives -The Director of Finance will explore alternatives to the issuance of debt for major capital projects. These alternatives will include, but are not limited to: 1) grants-in-aid, 2) use of fund balance or working capital, 3) use of current revenues, 4) contributions from developers and others, 5) leases, and 6) impact fees. D. Conditions for Usin,? Debt -Debt financing of major capital projects will be done only when the following conditions exist: When non-continuous projects (those not requiring continuous annual appropriations) are desired; • When it can be determined that future users will receive a benefit from the major capital project; • When it is necessary to provide basic services to residents and taxpayers (for example, purchase of water rights); • When total debt, including that issued by overlapping governmental entities, does not constitute an unreasonable burden to the residents and taxpayers. E. Costs and Fees -All costs and fees related to debt issuance will be paid out of debt proceeds. City of San Marcos Financial Policy -Proposed Sept 2008 Page 16