2018-07-06 Special Meeting Agenda

SPECIAL MEETING AGENDA    6 JULY 2018




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SPECIAL MEETING AGENDA                                                                   6 JULY 2018

  DEBT POLICY

  GUIDING PRINCIPLES
  The purpose of establishing a Debt Policy is to:
  °     Provide a comprehensive view of Council's long term debt position and the capacity to fund
        infrastructure growth for the Shire;
  °     Increase awareness of issues concerning debt management;
  °     Enhance the understanding between Councillors, community groups and Council staff by
        documenting policies and guidelines;
  °     Demonstrate to government and lending institutions that Council has a disciplined approach
        to borrowing.

   ROLES AND RESPONSIBILITIES
   Pursuant to section 192 of the Local Government Regulation 2012 detail of the proposed borrowing
  for the current year and the future 9 years will be prepared annually as part of the budget process.
  Applications outlining proposed borrowings will be forwarded to the Minister for Local Government
  for approval.
  Credit Reviews will be undertaken periodically by the QTC on behalf of the Minister for Local
  Government.

   Loan proceeds will be drawn down subject to cash flow requirements annually so as to minimise
   interest expenses.
  All lease proposals will be referred to Financial Services for evaluation against the QTC Asset
   Financing Model to assess alternatives for funding asset acquisition and to ensure statutory
  compliance.

   MEASUREMENT OF SUCCESS
   Financial sustainability indicators remain within target ranges and the provision of necessary
   infrastructure is not constrained through the lack of capital funding.
   Details of outstanding loans will be reported annually in Council’s Financial Statements and Annual
   Report.

   DEFINITIONS
  Business Activity — A Council activity subject to the application of full cost pricing principles as
  defined in the Local Government Act 2009 and Local Government Regulation 2012.
  Inter-generational equity — This relates to the fairness of the distribution of the costs and benefits
  of a policy when costs and benefits are borne by different generations. (i.e. the principle whereby
  those who derive a direct benefit from the service or infrastructure provided actually pay for that
  service).
  Net financial liabilities ratio — This is an indicator of the extent to which the net financial liabilities
  of Council can be serviced by its operating revenues. A ratio greater than zero (positive) indicates
  that total liabilities exceed current assets, whereas a ratio of less than zero (negative) indicates that
  current assets exceed total liabilities and therefore Council would appear to have the capacity to
   increase loan borrowings.
   QTC — Queensland Treasury Corporation.

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