Saturday, February 21, 2009

Council Can Grant Itself a Waiver – 10% Debt Limit

From the City Attorney, William Hackworth, an answer to my question regarding required action by Council to exceed the self-imposed debt limit of 10%. In 2010 it will be exceeded at 10.1%.
Ms. Garner:

“My answer would be that this would be a policy issue for City Council. If Council wanted to grant itself a “waiver” for one year, I don’t know why it couldn’t do so, since this limit is a voluntary, self-impose done. It may not make the rating agencies happy, but how it is dealt with is within the discretion of Council.Mr. Stovall notes that the ratio of 10.1% in FY 2010 is due primarily to revenue contraction in the budget (General Fund budget will not grow) as opposed to poor planning. He also notes that the City will be within the limits of the other two measures – Ratio of Net Bonded Debt to Assessed Value of Real Estate and Reduction of Aggregate Debt Within Ten Years.I have asked our Director of Finance if she has any additional thoughts on this, but haven’t heard back yet. If she does, I will forward them to you.”

William Hackworth


Of course we hope any waiver will not be necessary but citizens should be prepared should their be further revenue contraction.

Posted By Valerie Garner

Categories: Finance, Politics, Roanoke City Politics



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