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Task Forces

Task Forces

Latest Books

  • 2. What to consider in the national legislation? 21.12.2010

    The financial framework of local governments plays a key role in the sustainable development of local credit markets. The design of intergovernmental fiscal structure together with the accounting system and reporting procedures are important factors that are taken into consideration by financial institutions when assessing the opportunity to finance local governments

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  • 3. Which debt instrument is suitable? 21.12.2010

    here are two major types of debt instruments available to finance municipal capital expenditures: (i) loans and (ii) bonds. Loans are granted by a financial institution (e.g. commercial bank) directly to the local government. Applying for a loan is less complex than the procedures required for bond issuance. From this point of view, loans are more advantageous to small and medium size municipalities seeking external financing. Many international financial institutions have dedicated programs aimed at supporting and financing local governments' infrastructure projects, especially in the emerging markets.

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  • 4. Local Government's Creditworthiness Assessment 21.12.2010

    Prior to establishing the terms and conditions of a financing agreement (be it loans or bonds), investors evaluate local governments' creditworthiness. The creditworthiness of a local government measures both quantitatively and qualitatively its ability to repay debt.

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  • 5. Improving Financial Management Performance 21.12.2010

    Adequate, accurate and timely financial information on local governments' operations benefits both investors and local governments. A uniform financial reporting format, which suites both local/ central governments' and investors' requirements, should be a top priority for national regulators, as a precondition for improved financial management performance.

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  • 6. How to find and select the lender? 21.12.2010

    Depending on which type of debt instrument (loans or bonds) a local government wants to issue, there are different specialized financial institutions which should be approached. Local government loans are originated by: (i) municipal banks, (ii) commercial banks, (iii) international financial institutions and (iv) municipal development funds. Bonds are intermediated by commercial/ investment banks or brokerage houses. The existence and availability of these financial institutions to finance local governments depends on the architecture (bank lending model or bond model) and development of the local credit market. Central and local authorities should promote specific measures aimed at supporting the development of sustainable credit markets by minimizing the risk of market failures.

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  • 7. How to manage the credit? 21.12.2010

    Local governments can tap external resources using a wide range of borrowing instruments. However, each instrument is suited to finance only certain types of activities. Short term financing instruments include: (i) working capital credit line – local government draws funds from the credit line, on which they pay interest, to finance temporary revenue shortages; principal is usually rolled over, (ii) bridge loans are a special type of short term loan where financing for a capital investment project is provided for a transitory period until the main (long term) financing is obtained. Medium and long-term borrowing should be pursued by local governments when financing capital investment projects. Long-term borrowing to cover current expenditures is usually prohibited by law and must be avoided anyway.

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  • 8. How local government associations can help improve the local debt legislation and credit market 21.12.2010

    Local government associations are voluntary membership organizations, which comprise local governments from within a country or region, acting as an effective and authoritative advocate on members’ behalf in relation to central government, the parliament, potential investors and other stakeholders.

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  • Glossary 21.12.2010

    Accrual Accounting System Cash Basis Accounting System Modified Accrual Basis Accounting Credit Enhancement Municipal Credit Market Due Diligence Debt Limitation Debt Policy Debt Restructuring Debt Service Capacity Escrow . . .

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  • Fiscal Decentralization Task Force Meeting in Sofia, 14-15 December 2010 14.12.2010

    FDTF Sofia 2010 group The main pillars of this meeting hosted by NAMRB were: a) exchange of updates between the members on the current issues in fiscal decentralization in their countries; b) update on the progress of the project on Municipal Borrowing and promotion of the capacity building component and c) further development of the project ideas selected and prioritized at the meeting in Skopje: Non-tax Revenues, Multiannual and Participatory Budgeting and Budget negotiations II.

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  • Disaster for the municipalities 01.12.2010

    die_welt Pforzheim is a town of nearly 119 000 inhabitants in the state of Baden-Württemberg, southwest Germany. It is world-famous for its jewelry and watch-making industry. Because of that it gained the nickname "Goldstadt" or Golden City. It has an area of 98 km² and is situated between the cities of Stuttgart and Karlsruhe. Unfortunately, lately the city is becoming famous for another thing. On 5 January 2010, "Die Welt" published a story of a long struggle of the town Mayoress and her city treasurer that may lead to a legendary loss of 77.5 million euro in the years 2014-2017. The translated version of the story is available at the link below.

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