Number
091025
Version
Substitute 1
Reference
070880
Sponsor
The Chair
Title
Substitute resolution authorizing the Commissioners of the Public Debt to market general obligation revenue anticipation promissory notes.
Analysis
State shared revenue payments comprise about 35% of the City’s general fund revenues. The majority of these revenues are received at the end of the year. However, City expenditures occur relatively evenly throughout the year. This causes a cash flow problem where expenses occur prior to the receipt of revenues. This cash flow borrowing permits the City to timely pay for expenses as they come due in anticipation of receiving State shared revenue payments later in the year. The Revenue Anticipation Notes are repaid from the November State shared revenue payment.
Body
Whereas, S. 67.12(12), Stats., authorizes the issuance of General Obligation Notes for paying any general and current municipal expense; and
Whereas, S. 67.12(1), Stats., authorizes any municipality entitled to receive deferred payments to issue municipal obligations in an amount not to exceed 60% of the total actual and anticipated receipts in the fiscal year; and
Whereas, The City anticipates the receipt of at least $400 million of deferred revenues in 2010 (the “Budget Year”), which includes over $220 million of deferred State Aid; and
Whereas, The predominance of State Aid will be received at the end of the Budget Year, but operating expenditures are incurred on a uniform basis throughout the year; and
Whereas; The City must finance the operating budget on an interim basis between now and the receipt of State shared revenue payments in July and November; and
Whereas, The City desires to pledge the anticipated revenue included in the budget for the Budget Year due and not yet paid as security for repayment of such obligations; and
Whereas, The City has authorized up to $125,000,000 of General Obligation Commercial Paper Promissory Notes, 2008 Program Series C2...
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