Debt Management Policy

• The purpose of this policy is to establish guidelines for the issuance and management of the debt of the City of Palm Bay, Florida (hereinafter referred to as to “City”).  The City is committed to consistent best practices in financial management, including maintaining the financial strength and flexibility of the City and the full and timely repayment of all borrowings.

Fund Balance Policy

• The purpose of this policy is to establish a fund balance/retained earnings policy tailored to the needs of the City to insure against unanticipated events that would adversely affect the financial condition of the City and jeopardize the continuation of necessary public services.  This policy will ensure the City maintains adequate fund balance/retained earnings and reserves in the City’s various operating funds to provide the capacity to:

  (1) provide sufficient cash flow for daily financial needs,

  (2) secure and maintain investment grade bond ratings,

  (3) offset significant economic downturns or revenue shortfalls, and

  (4) provide funds for unforeseen expenditures related to emergencies.

Investment Policy

•  The purpose of this policy is to set forth the investment objectives and parameters for the management of public funds of the City of Palm Bay, Florida (hereinafter “City”).  These policies are designed to ensure the prudent management of public funds, the availability of operating and capital funds when needed and an investment return competitive with comparable funds and financial market indices.

Swap Policy

•  The purpose of the Interest Rate Risk Management Policy is to outline a framework for the utilization of interest rate swaps, and other financial products (Caps, Collars, etc.) available in the marketplace, as they relate to the City of Palm Bay’s Debt Management Policy and programs.

  Derivative financial products will not be employed as investment instruments or for the purpose of speculation. Any swap or derivative product transaction should not impair the outstanding bond rating of the City or negatively affect the amount of credit enhancement capacity available to the City.

  The City will be open to innovative ideas for any proposed transaction as well as variations from the following guidelines provided that such variation shall be fully explored with the City’s advisers and explained to the Council Members of the City.

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