Lower Merion Township, PA
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The Township’s issues debt to finance its capital expenditures. The following information is aimed at providing citizens and stakeholders with a clear, concise non-technical summary of the Township’s outstanding debt, credit rating, annual debt service payments and legal debt margin.
Most of the information contained on this page is from the Township’s annual Comprehensive Annual Financial Report (CAFR). This information is not provided to satisfy formal compliance to potential investors, rather it is a supplement to the Township’s ongoing disclosure compliance efforts. Any questions regarding the Township’s disclosure efforts to the municipal market or the Township’s credit should be directed to the Township’s Chief Financial Officer.
Township Debt Management Policy
The Township originally adopted a Debt Management Policy in 2009. The Debt Management Policy was then revised and adopted by the Board of Commissioners on June 15, 2016. The policy was modified slightly when the Board of Commissioners completed a comprehensive revision to the Township's Financial Policies in August 2017.
Debt Management Policy (PDF)
Current Rating Agency Reports
Moody’s Report (PDF)
Standard & Poor’s Report (PDF)
Township Outstanding Debt
The current outstanding debt as of December 31, 2017 is $107,520,000. Of this total $18,046,740 is allocated to business-type activities which refers to the Township’s Sanitary Sewer Fund. The debt is paid for through the Sewer Rates charged to sewer customers. The remaining total outstanding debt of $89,473,260 is governmental debt which includes all non-sewer debt. This debt is paid through the Township’s General Fund.
The bonds currently outstanding as of December 31, 2017 are as follows:
| Description | Average interest rate |
Maturity dates through |
Balance outstanding |
|---|---|---|---|
|
Series A of 2010 |
4.11 |
2026 |
$11,675,000 |
|
Series C of 2010 |
5.17 |
2031 |
14,540,000 |
|
Series A of 2011 |
3.33 |
2023 |
6,925,000 |
|
Series B of 2011 |
3.51 |
2028 |
10,330,000 |
|
Series A of 2012 |
3.93 |
2027 |
7,690,000 |
|
Series A of 2013 |
2.00 |
2033 |
9,750,000 |
|
Series A of 2014 |
2.70 |
2029 |
5,590,000 |
|
Series B of 2014 |
2.90 |
2034 |
8,195,000 |
|
Series A of 2015 |
4.40 |
2020 |
3,140,000 |
|
Series B of 2015 |
3.78 |
2035 |
9,010,000 |
| Series A of 2016 |
4.00 | 2020 | 3,655,000 |
| Series B of 2016 |
2.04 | 2036 | 7,215,000 |
| Series A of 2017 |
2.61 |
2037 |
9,805,000 |
|
Total general obligation bonds |
107,520,000 |
||
|
Less allocation to business-type activities |
18,046,740 |
||
|
Total governmental activities |
$89,473,260 |
||
Ten-year history of Township’s outstanding debt (PDF)
Township Debt Service
The annual debt service payments for the Township’s outstanding debt as of December 31, 2017 are shown in the chart below.
| Governmental Activities | Business-type Activities | |||
|---|---|---|---|---|
| Principal | Interest | Principal | Interest | |
|
Year ending December 31: |
||||
|
2018 |
$6,959,197 |
$3,056,476 |
$1,345,803 |
$607,426 |
|
2019 |
6,913,797 |
2,805,418 |
1,396,203 |
562,824 |
|
2020 |
7,010,037 |
2,524,277 |
1,389,963 |
507,052 |
|
2021 |
7,085,659 |
2,261,989 |
1,339,341 |
455,980 |
|
2022 |
7,011,864 | 1,996,626 | 1,353,136 | 404,005 |
|
2023 to 2027 |
30,972,353 |
6,460,620 |
5,697,647 |
1,364,367 |
|
2028 to 2032 |
17,133,853 |
2,276,397 |
3,651,147 |
547,722 |
|
2033 to 2037 |
6,386,500 |
372,587 |
1,873,500 |
137,409 |
|
Total |
$89,473,260 |
$21,754,390 |
$18,046,740 |
$4,586,785 |
Legal Debt Margin
The Township’s legal debt limit (excluding lease rental debt), as defined in Section 102 of the Local Government Unit Debt Act of the Commonwealth of Pennsylvania (Act 52), to be used for capital projects without electorate approval as specifically itemized in a capital budget, was $218,144,630 as of December 31, 2017. The Township’s total outstanding nonelectoral debt of $107,520,000 as of December 31, 2016 represents 49% of its legal debt margin.
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