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(c) Market conditions are unstable or present difficulties in <br />marketing. <br />(ii) Factors Favoring Long -Term Financing <br />(a) Revenues available for debt service are deemed to be <br />sufficient and reliable (generally a coverage ratio equal to <br />120%) so that long-term financings can be marketed with <br />investment grade credit ratings. <br />(b) The project securing the financing is of the type that will <br />support an investment grade credit rating. <br />(c) Market conditions present favorable interest rates and demand <br />for City financings. <br />(d) The project is mandated by state or federal requirements, and <br />resources are insufficient or unavailable. <br />(e) The project is immediately required to meet or relieve <br />capacity needs and current resources are insufficient or <br />unavailable. <br />(f) The life of the project or asset to be financed is 10 years or <br />longer. <br />5) The City may utilize lease/purchase agreements to acquire needed equipment <br />and facilities. The City will use the following criteria to evaluate the use of <br />lease/purchase agreements: <br />(i) Factors for Evaluating the Use of Lease Purchase Agreements <br />(a) The life of the asset to be financed is three (3) years or longer. <br />(b) The minimum value of the agreement is $25,000. <br />(c) The interest costs must not exceed the interest rate earned on <br />the City's investment portfolio for the average of the past six <br />(6) months as reported to the City Council. <br />B. Debt Management <br />1) The City will not obligate the General fund to secure long-term financings <br />except when marketability can be significantly enhanced. <br />2) The term of the long-term debt instrument will not exceed the legal life of the <br />asset or thirty (30) years, whichever is less. <br />4225 <br />5 <br />