Sometimes there are good reasons for going into debt. Some of these may include:
Financing projects over time, with a variety of repayment options and revenue streams.
Minimizing the impact on property taxes.
Ensuring that future stakeholders will pay for their share of public improvements and services.
The City of Stillwater currently holds an AA- bond rating on general obligation bonds, and tax notes from Standard and Poor's and Fitch Ratings. Bond ratings measure credit-worthiness. The higher the bond rating, the lower the interest rate paid by the City. Losing the AA- bond rating would result in the City paying more interest on bonds issued.
|General Bond Obligation||Tax Notes||Revenue Bonds|
|Approval Process||Bond election||Elected officials||Elected officials|
|Security/Pledge||Taxes only||Taxes and/or revenue||Revenues of the System|
|Typical Projects||Capital or public safety asset||Any public purpose||Water, sewer and drainage infrastructure|
|Ratings||Highest rated credit based on ad valorem tax pledge||Typically 1 or 2 notches lower than a city's tax credit|