Debt-Free Long-Term Capital Financing

About the Program

Category: Financial Management (Best in Category)

Year: 2023

Debt-Free Long-Term Capital Financing is a County-wide strategy to eliminate debt-financing of capital items. The process of issuing debt to finance large capital projects is standard among many counties across the United States. The Congressional Research Service published a memo in April 2020 discussing the typical nature for state and local governments to issue debt to finance the construction of buildings, roads, and airports. Additionally, the National Association of Counties identified within its Municipal Bonds Action Center that “municipal bonds remain the primary method used by states and local governments to finance public capital improvements and public infrastructure projects that are essential for creating jobs, sustaining economic growth and improving the quality of life for Americans in every corner of this country.” San Juan County, New Mexico has developed a long-range 30-year planning methodology that has effectively defeated the “standard practice” of financing large capital projects, instead, leveraging their capital needs with existing recurring cashflows offset by any secured federal, state, and local grant funding that may become available. Essentially San Juan County’s current and future capital needs will be secured debt free!