Page 14 - Moreno Valley City 2025 PAFR

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Governments, just like businesses and individuals, determining the interest rate on bonds. A strong credit
must finance certain purchases with debt. The key is rating allows the City to borrow funds at lower interest
to match the life of the assets being purchased, with rates, reducing the cost of financing infrastructure
the term of the debt payments. Accordingly, the City’s projects and other capital investments.
debt is predominantly related to long-lived capital
assets. For more information on the City’s debt program, visit
the Investor Relations page on the City’s website.
At year-end, the City’s governmental activities had
$133.9 million in bonds, certificates of participation,
WHY DOES THE CITY BORROW
lease liability, SBITA, compensated absences, Pension
and Other Post-Employment Benefits (OPEB) liability Local governments issue bonds to pay for large,
and self-insurance claims and judgments. expensive, and long-lived capital projects, including
roads and electric utilities. Without issuing debt, these
The City’s credit rating is AA- by Standard & Poor’s. important infrastructure needs would be unmet. While
A key factor in achieving and maintaining the strong local governments can sometimes pay for capital
rating is the action of the City Council and the City investments with current revenues, borrowing allows
Manager to balance the City’s General Fund budget. them to spread the costs across multiple generations
The credit rating is the most important factor in due to their long-term benefit.

DEBT PER CAPITA OUTSTANDING DEBT FOR THE YEAR ENDED JUNE
30, 2025
Govern- Business-
$500 mental type
Activities Activities

Direct Placements
$400
Notes and Other $ - $ 5,430,777
millions $300 $489 $483 $465 $444 $426 Other Liabilities $ 20,136,962 $ 42,838,426 -
Lease revenue bonds
$ 15,955,000
$
Certificates of participation
Lease liability $ 2,396,730 $ -
$200
SBITA liability $ 2,976,329 $ -
Compensated absences $ 10,337,302 $ 350,023
$100 Net pension and OPEB
liability $ 77,559,047 $ 3,603,622
Self-insurance claims and
$0 judgments $ 4,522,000 $ -
FY FY FY FY FY
20/21 21/22 22/23 23/24 24/25 $ 133,883,370 $ 52,222,848

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