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Advisors: Annapolis' debt service stays near policy target, may exceed 10% in 2028–29
Summary
Financial adviser Davenport & Company presented an annual debt-capacity update April 24 showing the city remains below its debt-service policy ceiling but may exceed the 10% policy target in fiscal 2028 and 2029 under current CIP assumptions. Council asked for scenario analyses showing the effect of different revenue or tax-rate trajectories.
City financial advisers told the Annapolis City Council that the city’s debt service remains generally affordable under current assumptions but will inch above the city’s 10% policy target in fiscal 2028 and 2029 if the proposed CIP and conservative assumptions hold.
Jennifer Derrickson, senior vice president at Davenport & Company and financial adviser to the city, presented the annual debt-capacity update at the April 24 work session. Derrickson summarized the methodology used for the analysis: existing debt service plus estimated new debt based on the proposed FY26–FY31 CIP, proposed general-fund expenditures for FY26 and a conservative 1% growth assumption thereafter, and interest-rate assumptions of 4.5% for bonds issued in FY26 and 5% in subsequent…
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