The City of Victoria recognizes the primary purpose of capital improvements is to support provision of services to its residents. The City limits long-term debt to only those capital projects that cannot be financed from current revenues. In addition, the City does not use long-term debt to finance recurring maintenance and operating costs and issue debt longer than the estimated useful life of the capital project.
There are various types of debt instruments available to the City of Victoria to finance large capital improvement programs; however, the City mainly uses the following debt instruments for long-term financing.
Certificate of Obligation (C.O.)
Legal debt instruments used to finance capital improvement projects. Certificates of Obligation are backed by the full faith and credit of the government entity and are fully payable from a property tax levy. Certificates of Obligation differ from general obligation debt in that they are approved by the City council and are not voter approved
General Obligation Bonds (G.O.)
Bonds that finance a variety of public projects such as streets, buildings, and capital improvement. They are backed by the full faith and credit of the City and are voter approved.
Bonds whose principal and interest are payable exclusively from user fees (i.e. revenue generated by the water and wastewater system.
The City’s debt management policy and Post Bond Issuance Compliance Policy can be found in the Financial and Budgetary Policy section of the annual budget.
The following is list of outstanding bond issues with the intended use of proceeds and the par amount for the City’s outstanding debt.
The following is an update on the City’s Debt Capacity from an April 2016 presentation to Council.