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FINANCE DEPARTMENT
Policy #5 -007: Debt Management Policy
Approval Date: September 11, 2017
Approval Authority: Council, By-Law 4135
Effective Date: September 11, 2017
Next Scheduled Review Year: 2025
Department: Finance
Last reviewed: 2021
Revision Date/s:
Schedules:
A. POLICY STATEMENT
• The Town’s net debt charges will not exceed 75% of the Town’s
Annual Repayment Limit for the year in question
• Debt levels for tax-supported projects will reduce year over year
• The Town will make every effort to apply for and obtain funds from
senior levels of Government for capital projects.
B. PURPOSE
The purpose of this policy is to provide guidelines for dealing with the
management of debt to ensure that any new borrowings meet the principles
established by Council.
C. SCOPE
The Town has three funding sources that comprise the overall debt total;
• Tax supported - Funded through raising taxes;
• User fee supported - Funded through user fees or external sources i.e. funding
for the pool deck or a vehicle for utility use;
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• Operational savings supported - Funded through savings realized by
implementing the project i.e. LED light replacement
D. GENERAL
Debt levels are to be established for the year during the budget process. These
levels may be addressed by Council should the need arise during the course of
the year.
E. AUTHORITY
The Treasurer is authorized to arrange debt within the parameters described and
subject to the approval of Council.
F. POLICY
The Annual Repayment Limit (UNDER ONTARIO REGULATION 403 / 02) repayment
limit has been calculated based on data contained in the Ministry of Municipal Affair’s
Financial Information Return. This limit represents the maximum amount which the
municipality had available as of December 31 each year to commit to payments relating
to debt and financial obligation.
Prior to the authorization by Council of a long term debt or financial obligation, this limit
must be adjusted by the Treasurer in the prescribed manner.