1. City of Stockton 1 Debt Policies For The City of Stockton

2. City of Stockton 2 Debt Management Thoughtful and strategic use of debt to achieve capital project and infrastructure financing. This includes the development of a formal debt policy  A formal debt policy is an industry norm; “Government Finance Officers Association - Best Practices” standard  Bond Rating Agency expectation for certain types of financing  A “first” for Stockton City Council – previously no comprehensive debt policy in place

3. City of Stockton 3 Debt Policy  Establishes parameters for issuing and managing debt  Outlines City’s approach to financing long-term debt and refinancing outstanding debt  Addresses debt capacity and sets financing criteria  Establishes terms and conditions of bond issuance

4. City of Stockton 4 Debt Policy  Addresses the consideration and application of credit enhancements such as bond insurance and letters of credit  Outlines the options for bond method of issuance  Establishes Underwriter, Bond Counsel and Disclosure Counsel selection criteria  Defines the role of consultants in the debt issuance/debt administration process

5. City of Stockton 5 Policy Highlights General Purpose Debt Capacity  Debt service will not exceed 7% of General Fund expenditures and transfers out ($13 mm) Swap Policy  Improved management of assets & liabilities Methods of Issuance  Debt Policy Committee will determine case by case the best methodology to issue debt