Capital Budgeting and Finance: A Guide for Local Governments

by Marlowe, Justin; Rivenbark, William C.; Vogt, A. John

• ISBN13: 9780873261883
• ISBN10: 0873261887
• Edition: 2nd
• Format: Hardcover
• Copyright: 2009-12-15
• Publisher: Intl City County Management Assn

Summary

Capital Budgeting Finance: A Guide for Local Governments, 2nd edition, provides practical information and detailed strategies to develop the essential capital improvement plan for any community, emphasizing the most current guidance for developing a capital financing strategy and managing debt. City managers and staff, finance and control department staff, and anyone responsible for some aspect of prioritization of capital projects, development of strategic plans, budget creation, financing strategies, and budget management and execution will benefit from this excellent resource.

Table of Contents

Note to the Reader	p. xi
Foreword	p. xiii
Acknowledgments	p. xv
Setting the Stage	p. 1
Capital budgeting: Rationale, scope, policy, and process	p. 3
Rationale for capital budgeting	p. 3
Definition of capital expenditures	p. 5
Policy framework for capital budgeting	p. 11
A comprehensive model of capital budgeting	p. 19
Summary	p. 24
Capital improvement program	p. 27
Definition of a capital improvement program	p. 27
Purposes of a capital improvement program	p. 28
Characteristics of a capital improvement program	p. 30
Contents of a capital improvement program	p. 32
Needs assessment	p. 40
Issues of preparation and approval	p. 41
Financial condition analysis	p. 43
Financial forecasting	p. 48
Summary	p. 56
Planning for Capital Investment	p. 59
Evaluation and prioritization of capital assets	p. 61
Evaluation of capital projects	p. 62
Prioritizing capital projects	p. 70
Summary	p. 85
Public-private partnerships	p. 87
Types of public-private partnerships	p. 87
Public-private partnership structures and arrangements	p. 93
Evaluating public-private partnership opportunities	p. 96
Planning and policy tools	p. 103
Financing public-private partnerships	p. 106
Accountability in public-private partnerships	p. 111
Summary	p. 115
Financing Capital Assets	p. 119
Capital financing strategy	p. 121
Foundation for capital financing	p. 122
Pay-as-you-go capital financing	p. 123
Debt financing	p. 124
Public-private partnerships and economic development	p. 126
Outside capital financing	p. 128
Summary	p. 129
Pay-as-you-go capital financing	p. 131
Advantages of pay-as-you-go capital financing	p. 131
Disadvantages of pay-as-you-go capital financing	p. 133
Revenues and fund balances	p. 134
Capital reserves	p. 137
Charges to property	p. 139
Federal and state grants	p. 148
Summary	p. 152
Debt options	p. 155
Security pledged for debt	p. 155
General obligation bonds	p. 156
Revenue bonds	p. 160
Lease financing of capital assets	p. 165
Special obligation debt	p. 174
Summary	p. 179
Planning, structuring, and selling debt	p. 183
Bond ratings and the rating process	p. 184
Planning and structuring debt	p. 196
Interest rates, yields, and pricing	p. 202
Selling local government debt	p. 215
Summary	p. 231
Conclusion	p. 235
Implementation, oversight, and evaluation	p. 237
Authorizing projects and appropriating money	p. 237
Managing project changes and change orders	p. 240
Evaluating capital budget and capital improvement program implementation	p. 244
Summary	p. 246
Glossary	p. 249
Index	p. 271
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