Sarasota County Debt Management Policy - Resolution 2021-184

Sarasota County Debt Management Policy E. REFUNDINGS The Debt Management Team will monitor refunding opportunities of the County's outstanding debt portfolio. Refunding opportunities will be considered (within federal tax law constraints) if: 1. There is a net economic benefit, 2. Essential in order to modernize covenants or for restructuring purposes, 3. Essential to operations and management. The net economic benefit to the County generally must provide a net present value savings of at least five percent of the debt being refunded. Refundings that offer less than a five percent net present value savings may be considered on a case-by-case basis. Refunding with negative savings will not be considered unless there is a compelling public policy or legal objective to do so, including to restructure underlying bond documents pursuant to which the revenues are pledged. The County will seek to purchase United States Treasury Securities State and Local Government Series (SLGS) to fund its refunding escrows. The County may choose to fund an escrow through the purchase of treasury securities on the open market when market conditions make such an option financially preferred or SLGS are not available. F. CREDIT ENHANCEMENTS Credit enhancement, such as letters of credit, bond insurance, and reserve policies, may be used but only when net debt service on the bonds is reduced by more than the costs of the credit enhancement. G. VARIABLE RATE DEBT The County may choose to issue securities that pay a rate of interest that varies according to a pre-determined formula or results from a periodic remarketing of the securities, consistent with state law and prevailing covenants of existing debt and depending on market conditions. The County will limit its outstanding debt in a variable rate to reasonable levels in relation to total outstanding debt. H. SHORT-TERM NOTES Use of short-term borrowing, such as bond anticipation notes and commercial paper, will be undertaken only if the transaction costs plus interest on the debt are less than the cost of internal financing, or if the available cash for internal financing is insufficient to meet funding requirements. When internal financing is utilized, it will be evidenced by an lnterfund Loan Note and if such financing is provided by the General Fund, said note will be approved by the Board. 9