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Managing Our Debt

This presentation delivered by R. Hill from the Committee on Finance and Taxation provides a comprehensive overview of the Town of Stoughton’s debt situation as of January 1, 2012. Total town debt stands at $34,230,496, with additional unfunded borrowing authorizations totaling $21,506,095. The talk outlines the debt retirement plan for FY 2011-2013, the expected paydown timelines, and the town's bond rating of Aa2 according to Moody’s Investors Service. Key strategies and goals are discussed to maintain fiscal responsibility while ensuring essential town services and assets are preserved.

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Managing Our Debt

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  1. Managing Our Debt 2012 Annual Town Meeting Debt Presentation. R. Hill Committee on Finance and Taxation

  2. Total Town Debt (As of Jan 1st, 2012)$34,230,496.Source: Treasurer/Collector, Town of Stoughton

  3. Unfunded Borrowing Authorizations Authorized and Unissued Debt(Potential Additional Debt Liability)$21,506,095(Includes Library Appropriation of $14,000,000)Source: Statement of Indebtedness; FirstSouthwest, June 30 2011. Authorized and Unissued Debt a/o June 20, 2011

  4. Debt Budget FY 2013Breakdown

  5. Retirement of Debt FY 2011-2013

  6. Sources and Funding

  7. How Long to Pay Off Our Debt If No Additional Borrowing? Formula: Total Debt/Pay down Rate = Number Of Years $34,290,496/*3,708,165 = 9.24 Years*Pay down Rate Based on 2013 Budgeted Principle Payments

  8. Town Of Stoughton Bond Rating Moody’s Investors ServiceStoughton Bond Rating Aa2Legend: “Obligations rated Aa are judged to be of high quality and are subject to very low credit risk”.Source: Moody’s Rating Symbols & Definitions, June 2009. Moody’s Investors Service

  9. Moody’s Rating Criteria Source: Moody's Rating Methodology. General Obligation Bonds Issued by Local U.S. Governments. October 2009

  10. Moody’s Comment “Moody's believes that the town's 1.2% overall debt burden will remain manageable given rapid amortization of principal (87% repaid within 10 years) and limited long-term borrowing plans”. Source: Moody's Rating Methodology. General Obligation Bonds Issued by Local U.S. Governments. October 2009

  11. “What Can Make Ratings Go Up” -Maintaining structural balance and increase reserves -Increase in tax base, assessed valuation or demographic profileSource: Moody’s Global Credit Research, Town of Stoughton-02-May 2011

  12. “What Can Make Ratings Go Down” -Decrease in reserves -Inability to maintain structural balanceSource: Moody’s Global Credit Research, Town of Stoughton-02-May 2011

  13. Strategy Goal:-Maintain or Reduce The Town’s Debt Burden While Maintaining Town Services and AssetsSome Objectives:-Maintain Borrowing at or Below Pay Down Rate-Maintain Borrowing Cap @ 3-5% of Revenues-Grow Revenue

  14. The End 2012 Annual Town Meeting Debt Presentation. R. Hill – Committee on Finance and Taxation

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