No, there are several steps in the process. The first step has already occurred because, for several years, these projects have been identified as needed in the county’s Capital Improvement Program (CIP). The next step is choosing how to fund the projects. The referendum is a necessary step in order to be able to use General Obligation (GO) bonds to finance these projects. GO bonds are usually the least expensive way to borrow money to fund long-term capital projects.
Even after the referendum, GO bonds won’t be issued until the Board of Supervisors and County staff collect specific data about the costs and interest rates available for a GO bond issuance. If GO bonds are the best way to finance a project, then the Board of Supervisors will then adopt a resolution authorizing the actual sale of the GO bonds. GO bonds will only be issued if the revenue projected for the County budget is sufficient to cover existing principal and interest payments (debt service) as well as debt service from the issuance of any new bonds.
The County has several fiscal policies concerning debt and debt service. One of those policies requires that the ratio between the County’s debt service and expenditures be at 10% with a ceiling of 12%. Every year, county staff will review calculations and projections of debt-service-to-expenditures and other debt ratios. Staff will ensure that the ratios continue to be met over the life of the bonds; if the debt-service-to-expenditure ratio is approaching the ceiling, then capital projects can be shifted to later years or deleted.