Sarasota County Debt Management Policy - Resolution 2021-184

Sarasota County Debt Management Policy c. Self-Supporting Revenue Bonds are long-term debt instruments secured by non-ad valorem revenues derived from fees and charges from the County's Enterprise Operations such as Solid Waste, Water and Wastewater System, and Stormwater System (Enterprise Revenues). 2. Commercial Paper (CP) is a short-term debt instrument that may be used for periods not to exceed five years. The County can utilize a covenant to budget and appropriate legally available non-ad valorem revenues (CB&A pledge) or Enterprise Revenues for its short-term borrowings under programs such as the Florida Local Government Commercial Paper Loan Program (a variable rate debt). This program provides cash flow and cash management capabilities to implement the County's ongoing CIP for interim or temporary up-front financing to the County's pay-as-you- go CIP. A project financed with short-term notes, such as tax-exempt commercial paper may be "taken out" by a bank loan or public issue once costs for the project are finalized. 3. Bank Loans provide an alternative to the funding of projects with publicly sold bonds where interest costs are estimated to be lower than a comparatively priced public issue. 4. State and Federal Programs are long-term loans issued by a state or federal agency for a qualifying project loan. They are secured based on the revenue stream pledged to service the debt and nature of the capital projects to be financed. State Revolving Fund loans and the loans through the Water Infrastructure and Finance and Innovation Act, which is administered by the Federal Environmental Protection Agency, are examples of state and federal loan programs. 5. As part of the overall financing plan the Debt Management Team will determine the security pledge for the debt and whether the debt is issued on parity with existing debt or as a subordinate debt. To the extent it is in the best interest of the County, there is a preference that there be a nexus between the revenue pledged and the specific purpose for which the debt is issued. Additionally, bonds should generally be equally and ratably secured by the revenues pledged to the repayment of any outstanding debt. However, the creation of a subordinate lien is permissible if a first lien is not available, or if it is economically beneficial, or advantageous to the County. 6. Other types of debt that may be used are anticipation notes used as short-term financing and other promissory notes that may be issued for the repayment of short-term or long-term debt. 7