Overview
The Town borrows money to finance long-term capital improvements such as, but not limited to, police stations, fire stations, other town public buildings, vehicles, heavy-equipment, road and highways, and greenways. This allows the organization to avoid sudden increases in the property tax rate, by spreading costs over time. The Town does not issue debt to fund any of its operational needs.
In addition to the Town’s financial advisor, the Debt Management Section of the LGC staff works with the Town of Knightdale to determine the necessity of a project, the size of the issue, and the most expedient form of financing, then guides all projects through a rigorous review to ensure the financing meets all statutory requirements. The Debt Management Section oversees the sale and issuance of all local government debt, then monitors repayment of debt and issues debt notices required under statute.
G.S. 159 – Local Government Finance
Types of Debt
- Require voter approval
- Backed by the full faith and credit of the Town
- Lowest rate of interest
- Specific revenue source pledged
- Taxing power of government is not pledged
- Does not require voter approval
- Does not require voter approval
- Essentially a share in lease payments made by government agency
- Government creates lease agreement – independent authority issues the COPs to investors – government make lease payments – at end of lease government acquires ownership in underlying asset
- Underlying asset(s) financed used as collateral
- Similar to standard bank loan
- Not backed by full taxing power of the authority
- Backed by specific, limited sources of revenue or underlying asset(s)
- Does not require voter approval
- Allows a government to issue GO bonds in an amount up to two-thirds of the principal it paid off on existing GO debt during the previous fiscal year
Bonds
Bonds are tools that allow both current and future taxpayers to share the cost of amenities that will benefit them. These are rated by bond rating agencies.
Further explanation of the significance of such ratings may be obtained from Moody’s, S&P and Fitch respectively.
Recent Ratings Announcement: Moody’s Investor Service
How Bonds are Sold
The North Carolina Department of State Treasurer handles Town of Knightdale bond sales. Most bonds are sold competitively to the investment banking firm that offers the lower interest rate. That firm then sells the bonds to individuals and institutions. Individuals can buy Town of Knightdale bonds from registered broker dealers.
CUSIP Numbers
A bond CUSIP is an alphanumeric identification code, usually nine characters, assigned to each maturity of a bond issue and is printed on the face of each individual bond. All municipal bonds are assigned a CUSIP number prior to pricing.
Bond Ratings
Knightdale’s general obligation bonds have received a Aa1 and AA rating from two national credit rating agencies – Moody’s and Standard & Poor’s, respectively.
General Obligation (GO) Bonds
| Fiscal Year Issued | Amount | Purpose |
| 2013 | $3,000,000 | Parks and Recreation Facility |
Limited Obligation Bonds (LOBs)
| Fiscal Year Issued | Amount | Purpose |
| 2025 | $13,175,000 | Law Enforcement Facility |
| 2025 | $480,000 | Refund and Extinguish 2012 Public Safety Building Loan |
Other Non-Rated Debt Issuances
| Fiscal Year Issued | Type | Amount | Purpose |
| 2019 | IFC | $247,789 | Vehicles |
| 2020 | IFC | $2,000,000 | Real Property |
| 2021 | IFC | $1,080,000 | Fire Truck |
| 2021 | IFC | $5,217,000 | Public Buildings |
| 2022 | IFC | $6,614,000 | Fire Station |
| 2023 | IFC | $1,516,000 | Fire Trucks |
| 2023 | IFC | $2,184,000 | Fire Station |
For additional general North Carolina debt information, please see the Local Government Commission – Local Debt Management Section.
CONTACT US
Vacant
Finance Director
(919) 217-2210