by Debt Management Committee, Association of Public Treasurers

Outstanding tool for practitioners interested in preparing a comprehensive capital financing policy. The Handbook guides you through formulating a policy, the legal and regulatory requirements, needs assessment and funding alternatives, issuance of obligations, pertinent Internet sites, and much more.

Excerpt of Introduction

The Handbook is designed as a road map for the development and implementation of policy guidelines that address the unique needs and concerns of each jurisdiction.

State and local governments in the United States finance capital improvements in many different ways. Current revenues from taxation, property assessments, user fees, fines and forfeitures are used as a sort of "pay-as-you-go" method of improving infrastructure. Federal grants are another important source of revenue, although this source has declined in importance over the last decade. Contributions from private property developers in connection with new construction also are important in some areas of the country. Most important, however, is the use of borrowed funds and these are largely obtained from the sale of securities.

Debt issuance involves the commitment of governmental resources for an extended period of time; public officials must undertake such transactions only after careful planning. By developing and adopting debt issuance and management polices, governments are constructing a framework within which informed borrowing decisions may be made. In every jurisdiction, there are legal and practical limits to the amount of borrowing that may be done. Debt policies can help ensure that borrowing is done: (i) only when it is appropriate; and (ii) in the most cost-effective manner possible.

Table of Contents

1. Introduction
2. Formulating a Policy
1. Legal and Regulatory Requirements
2. Needs Assessment and Funding Alternatives
• Capital Improvement Program Preparation
• Establishing Priorities for Improvements
• Identifying Useful Life for Improvements
• Review of Financing Alternatives
3. Issuance of Obligations
• Selecting Service Providers
• Choosing a Method of Sale
• Competitive Sale-Bidding Parameters
• Negotiated-Sale Allocation and Designation Policies
• Rating Agency Applications
• Preparation of Disclosure Documents
• Selecting a Bond Type and Structure
4. Administration of Obligations
• Investment of Proceeds
• Arbitrage Compliance
• Derivative Products
• Investor Relations
• Rating Agency Communications
• Refunding and Restructuring Options
5. Using the Internet
3. Sample Policies
4. Additional References
5. Glossary
6. Certification Component