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CITY OF SOUTH BEND I OFFICE OF THE CLERK <br /> Mrs. Hockenhull replied, Yes, I will make sure you receive a copy. <br /> Councilmember Teshka asked, What do they take into account? <br /> Mr. Frierson answered, they will consider your cash flow, how great of a job Jen is doing. <br /> Mr. Flynn stated, And you will find in each of these reports explicit commentary regarding the <br /> details. Internal management and budgeting is strong. <br /> Mr.Frierson stated,but why you are rated at a Double A(AA),I go back to the strong management <br /> and you are what I call, smart debt issuers,in the sense you go through a process first. The projects <br /> that are happening are very good feedback projects for the City. <br /> Councilmember Scott stated, Taking on those bonds and paying of those bonds, doing good <br /> projects that improve your City. And people wanting to invest in those bonds for the City. <br /> Mr. Frierson stated,When I say smart debt and it's important that I say this. If you go to this bullet <br /> point here it's a positive, sixty-eight percent (68%) of your debt being returned here, that's <br /> excellent. You are also looking at from a structural standpoint, how is your debt coming off. You <br /> are making sure that you are issuing the right amount in the right years and when those opportunity <br /> projects come about, you address those. <br /> Councilmember Davis asked, From some Municipal standpoint fifteen (15) to twenty-five (25) <br /> years,then you see a challenge for that. <br /> Mr. Flynn answered, That's unique. The SNP rating is for all the US. Specifically, in the State of <br /> Indiana, you typically see a quick acceleration paid out of debt. But if you compared that sixty- <br /> eight percent(68%), to what percent you pay in the first(1st)ten (10) years,that number is going <br /> to be much lower. <br /> Mr. Dougherty stated, Before we go on just briefly, do you want to address the specific question <br /> about the bulk of our debt? <br /> Mr. Frierson answered, it doesn't. There are certain parameters in place to make sure you have the <br /> capacity. <br /> Councilmember Davis asked, You consider the property issues that will come up in 2020 on all <br /> those considerations and how the City will use the taxes, how do you look at that? <br /> Mr. Frierson answered, I guess from a property tax standpoint, as that is more of a general <br /> obligation, the City has very little actual debt that you are putting on property tax payers. That is <br /> one(1)of the great things about the Double A(AA)rating is that your debt is being paid by revenue <br /> and not being put on the property tax payers itself <br /> Mr. Dougherty interjected, Maybe we can use the Zoo as an example here; the analysis that goes <br /> into the fact that the Zoo Bonds would be repaid out of the EDIT Revenues, income revenues <br /> instead of property tax revenues. This has already been analyzed and deemed to be sufficient. In <br /> EXCELLENCE I ACCOUNTABILITY I INNOVATION I INCLUSION I EMPOWERMENT <br /> 455 County-City Building 1227 W.Jefferson Bvld I South Bend,Indiana 466011p 574.235.922111574.235.9173117D 574.235.55671www.southbendin.gov <br /> 14 <br />