Bertie has borrowing power
WINDSOR – Bertie County currently faces no debt after the 2023 budget year.
During Monday morning’s meeting of the Bertie County Commissioners, Ted Cole of Davenport and Company painted a financial picture of the county. The report was the same one in which the county leaders heard they would have to raise taxes between 12 and 22 cents to build a new high school.
The good news in the report was that Bertie County is in sound financial condition and has one of the highest 10-year debt payoff ratios in the state of North Carolina.
The majority of the current debt owed by Bertie County is the 2004 Health Department building, the 2006 Department of Social Services building and three school system debts, including Bertie Middle School.
The social services building and health department building combined for $3.5 million in debt for the county while the school debt totals $8.2 million.
“The target year we looked at was 2019, which shows your 10-year payoff,” Cole said. “As it stands right now, the county will have 85 percent of its debt retired in 10 years. That’s an exciting number. Anything above 55 percent is considered good.”
Cole said that information showed the county was able to assume some debt, because the ratio was so high.
At the 10-year mark, the county would owe only $986,086 total from the major projects they have undertaken. That number would reduce by roughly $200,000 per year over the next four years until all current debt was retired in the 2023 budget year.
Bertie’s total debt per capita ratio shows that $607 is owed per person in the county. That compares to a median of $972 per person in an average North Carolina A2 county. A2 is the credit rating deemed appropriate for Bertie by Davenport after studying their current financial situation.
The national median is lower at $389 per capita and the average for North Carolina counties is also slightly lower at $413 per capita.
The ratio for debt to assessed value is also better than the average A2 county in North Carolina coming in at 1.08 percent compared to 1.2 percent for the average A2 county. Again, the national average is lower at .50 percent.
The debt service to expenditures ratio also shows Bertie County ahead of the median of A2 counties in North Carolina. The county has a debt service to expenditures ratio of 7.25 percent compared to the average median of 7.9 percent in North Carolina.
“As a general rule of thumb, 15 percent is the maximum debt service,” Cole said. “The higher the debt service, the lower your ability to adjust your budget. Again, you’re right in the middle.
“These rates talk about debt capacity,” he added. “You can leave this section of the report thinking that you are moderately well off and have some debt capacity.”