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4. DEBT POLICY 4 1 The City will limit the use of debt so as not to place a burden on the fiscal resources of the City and its taxpayers 4 2 The City will limit long-term borrowing to capital improvements or projects that cannot be financed from current revenues. 4 3 When capital projects are financed, the City will amortize the debt within a period not to exceed the expected useful life of the project 4 4 The City will attempt to limit the General Fund annual debt service payments to 10%of the total General Fund revenue 4 5. Whenever possible, the City will investigate the use of special assessment, revenue or other self-supporting bonds to limit the General Fund obligation for debt service payments 4 6 The City will not use long-term debt for current operations. 4 7. The City will not use short-term borrowing to support routine operations, provided however, that it may be used to meet temporary cash flow needs 4 8 The City will utilize inter-fund loans when possible to reduce the cost of financing capital improvements 5. DELEGATION OF AUTHORITY Pursuant to the provisions of Sections 37209 and 40805 5 of the Government Code of the State of California, the Finance Director(Director of Finance) shall be the head of the Finance Department and shall be responsible for all of the financial affairs of the City This City Debt Management Policy grants the Director of Finance the authonty to select the financing team, coordinate the administration and issuance of debt, communicate with the rating agencies, as well as to fulfill all the pre-issuance and post-issuance disclosure information The Director of Finance or designee will use the Request for Proposal(RFP)process to select various Financing Team Members Below is a brief description of the main Financing Team, along with their functions, and the mandated frequency of soliciting RFP's The typical Debt Financing Team consists of 5.1. Financial Advisor e Assists with capital planning and long term financial planning ® Coordinates the financing and debt issuance process ® Helps evaluate underwriter proposals and provides financial analysis and recommendations ® Assists with the securing of other professional services and other members of the financing team • Monitors and evaluates market conditions for opportunities to issue debt at low interest rates ® Works with the City and Underwriter to develop investor outreach and market approach ® Manages competitive bid process ® Ensures negotiated prices are "fair"and reasonable in the marketplace Requests for Proposals for Financial Advisors should be done on a periodic basis notto exceed ten(10) years but is subject to review after four years