Centre International
 
 

Newsletter n°9, March 2011

 

 

Global survey on Impact of the financial crisis on the Public Finance specialized banks and their regional and local partners. You find the survey here. 

 

Click here to read the Press Release.

 

ICLC's Conference and General Assembly took place in Marrakech on 23-25 March 2011. Main topic for this meeting "Prospects for financing public infrastructure.

 

 


 

 



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Newsletter n°9, March 2011

 

 

Survey shows that the autumn financial crisis did not lead to a credit crunch for Local Authorities.

Click here to read press release.

 

The International Centre for Local Credit present itself here.

 

Looking at the Urban century and gives a snapshot on the local status of a global crisis.

 



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Municipal Finance Authority of British Columbia


Municipal Finance Authority of British Columbia (MFABC) Serves as a central borrowing agency for British Columbia (BC) municipalities, regional districts, utilities, transportation authorities, regional hospital districts, and other related public institutions.


MFABC’s primary is to provide long-term capital financing and to that end, the authority has oustanding over $6 billion for community capital projects.  In addition, it offers separate and voluntary programs: investment pooling, interim financing, and capital leasing.

 

Prior to 1970, when the MFABC was formed, each local government borrowed on its own merits. With less established financial markets in Canada in the 1960’s, not all local  governments secured timely or cost-effective financing. Many capital  projects remained in the planning phase only. In 1970, the MFABC was created by Provincial Statute. However, the MFABC is not provincially controlled, or owned, but is 100% owned by local government – there is no Provincial representation on its Board of Trustees.

As well, the Province does not guarantee the MFABC’s debt. The high credit ratings are due to four factors:

  • Tax Levy – without the need for senior government approval, MFABC’s Board of Trustees can levy a province-wide tax against $taxable properties. This tax levy has never been implemented, but could in case of a local government default on a debt payment to the MFABC.

 

  • Debt Reserve Fund – certain amounts of monies are held in reserve to protect investors against local government defaults. This total is retained at “two times the largest day’s interest due to bondholders”.  These monies are the first line of protection for the bondholders.

 

  • Joint & Several – all local governments guarantee each other’s debt repayments. If one local government debt finances a capital project, all of BC’s local governments’ taxation powers stand behind those local governments’ repayments.

 

  • Borrowing Rules – each local government has an individual borrowing limit, calculated with a formula focusing on cash-flows, economic diversity and general balance sheet strength.

 

The MFABC collects interest payments from its members on a semi-annual basis to meet interest payment obligations to bondholders.

  

The MFABC’s usual debenture term is 10 years, although 20 and 30 year traunches sometimes arise to meet client or investor demand.

  • Regional Districts: 28 regional areas represented by Members of the Authority
  • Municipalities: 160 (districts, cities, villages, townships, island municipality, resort municipality)
     

Loans outstanding as at 31-Dec-08 $4,397,126

Number of Loans as at 31-Dec-08: 3,220

 

Municipal Finance Authority of British Columbia (www.mfa.bc.ca)

Financial information

 

 

 

 MFABC's premises.