37:51The most notable topic of discussion was the city’s debt management and credit rating, which is important for maintaining financial stability and ensuring the city’s capacity to fund essential projects. The council examined the city’s current Triple-A credit rating for general obligation bonds, as rated by agencies such as Standard & Poor’s and Fitch, and deliberated on the factors influencing these ratings. The city was recognized for its “superior financial resilience,” attributed to a high midrange level of budgetary flexibility and strong demographic metrics, but concerns were raised about the potential for a downgrade if financial resilience waned. Such a downgrade could result from a decrease in the general fund reserve below 10% of spending and transfers or from increases in long-term liabilities.

33:37To maintain its favorable credit rating, the committee discussed the necessity of drafting a formal debt policy. This policy would help ensure compliance with financial management practices and optimize debt issuance, aligning it with adequate revenue streams. The committee highlighted the importance of aligning revenue sources with debt service requirements, noting that the current property tax levy was insufficient to cover annual borrowings for capital improvement projects and street reconstruction bonds. Recommendations included gradually increasing the debt levy by $1.5 million annually from 2026 to 2029, with smaller increases in subsequent years.

32:51Further discussions revealed the city’s intention to manage its debt issuance on a cash flow basis, requiring departments to project expected expenditures for the year. This approach aims to avoid maximizing debt capacity without due consideration of financial management realities, akin to a bank’s preapproval for a maximum loan.

23:45Another issue addressed was the city’s infrastructure needs, particularly concerning the “terrible” condition of roads due to decades of deferred maintenance. The committee debated the city’s practice of maintaining a consistent capital issuance level of $11 million for 20 years, questioning whether this approach was standard compared to other cities that might adjust issuance amounts in response to rising infrastructure costs.

01:32:18The impact of copper wire theft on public safety and financial management was also a focal point. The theft of copper wire, particularly affecting parks and street lighting, has led to safety concerns due to diminished lighting. The committee discussed the need for a clear understanding of the financial implications of addressing copper wire theft and the city’s response strategy. Public Works was noted to be handling the response by addressing thefts in batches, reducing the need for repeated visits to the same areas. Despite a noted drop in theft incidents in St. Paul compared to Minneapolis, the council recognized the ongoing challenge and emphasized the need for legislative efforts to curb theft.