Download 06.09.11 Presentation fr 2010 Innovation Award Winner. White

VGFOA 2010 Innovation Award:
Debt Management Tool
VGFOA Presentation: June 2011
Debt Management Issues
• Augusta County Service Authority has 12
independent water systems and 9 independent
sewer systems
• Lots of regulatory pressure to upgrade facilities:
– 3 largest WWTPs needed ENR upgrades for Ches. Bay
– 5 water supplies needed membrane filtration because
now under the influence of surface water
• Therefore, many opportunities from VDH and
DEQ to award us subsidized loans paired with
grants, especially in disadvantaged areas
Debt Management Issues
• Augusta County Service Authority has 25
outstanding bonds and loans
• $25 Million recently borrowed for 3 largest
WWTPs ENR upgrades and Authority is now at
“debt capacity” because bond revenue covenants
are now driving rate increases
• Therefore, being able to easily report on debt for
Board discussions, the budget process and
financial statement disclosures is very important
Creation of
Debt Management Tool
• Amortization schedules formerly kept in separate
worksheets for budget and audit purposes and
were time-consuming to keep updated
• No IT staff for the Authority so a college intern
was hired during Christmas Break to convert files
into one master spreadsheet
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Staff came up with the vision and design,
Intern Googled the internet to find a solution,
Staff reviewed the work, and
Intern documented the work so that updates could be
made by staff
Features of
Debt Management Tool
Audit work papers:
• Current versus non-current debt totals for
face of basic Statement of Net Assets
• Annual requirements to amortize debt by
year and summarized for five year segments
• List of each debt issue with outstanding
principal and amount due within one year
Features of
Debt Management Tool
Audit work papers:
• Reconciliation between disclosure tables
• G/L to amortization schedule reconciliation
• Portfolio interest rate average for
Capitalized Interest calculations
• Interest payable support calculations
• New debt issue amortization schedules for
auditors
Features of
Debt Management Tool
Budget calculation and presentations:
• Budget graph for Board: Debt “hump”
• Interest expense for Operating Budget
• Summarize by year and water versus sewer,
interest and principal payments for rate
calculations and to insure we make bond revenue
covenants for a six year financial plan
• Used this year to quickly determine the effect of
not drawing several debt issues in full for budget
discussions
Features of
Debt Management Tool
Used throughout year:
• Periodically verify G/L for outstanding debt or
interest payable amounts
• Can monitor due dates for debt issues from a cash
flow perspective
• Continuously update amortization schedules and
keep notes in one place for individual bond issues
• Use to support BAB interest subsidy
reimbursement requests
Thank you!
For a copy of the Debt Management Tool, e-mail
Debbie White at [email protected]