Agenda - Council - 12/08/2020 - Laserfiche WebLink

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Security Act for extraordinary pandemic -related expenses in the current fiscal year. For fiscal 2021, management expects to budget for at least a breakeven general fund results, with a 4.3% levy increase. The general fund's major revenue sources primarily include property taxes (81%), followed by licenses and permits (7%) and charges for services (6%). We expect local property tax bases to remain stable under recessionary pressures, which should help insulate the city from revenue volatility that other local governments that rely on nonproperty tax sources, such as sales and income taxes, might experience. Based on Ra msey's historically positive budgetary performance and expectations for positive results in fiscal 2020, we expect the city will maintain adequate -to -strong budgetary performance over upcoming years. Very strong budgetary flexibility Ramsey's budgetaryflexibility is very strong, in our view, with an available fund balance in fiscal 2019 of 69% of operating expenditures, or $8.9 million. We expect the available fund balance to remain above 30% of expenditures for the current and next fiscal years, which we view as a positive credit factor. Over the past three years, the total available fund balance has remained at a consistent level overall, tota ling 69% of expenditures in 2018 and 72% in 2017. Based on the city's lack of plans to draw down reserves for any purpose, we expect budgetary flexibility to remain very strong. Very strong liquidity In our opinion, Ramsey's liquidity is very strong, with total government available cash at 4.2x total governmental fund expenditures and 24.5x governments I debt service in 2019. In our view, the city has strong access to external liquidity if necessary. The city reported $76.8 million of cash and investments available for liquidity in fiscal 2019, held primarily in certificates of deposit, municipal bonds, and U.S. agency securities, which we do not consider aggressive investments. The city has strong access to external liquidity, in our opinion, because of its history issuing GO debt over the last two decades. Ramsey has no exposure to direct -purchase debt, and we expect its liquidity to remain very strong. Weak debt and contingent liability profile In our view, Ramsey's debt and contingent liability profile is weak. Total governmental fund debt service is 17.3% of total governmental fund expenditures, and net direct debt is 141.7% of total governmental fund revenue. Overall net debt is low at 2.5% of market value, which is in our view a positive credit factor.