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Budget in Brief

Debt Service Fund

The Debt Service Fund accounts for the accumulation of resources and the payment of debt of governmental funds. (The proprietary fund has its own debt.) Debt services costs are budgeted at $24.2 million for fiscal year 2019, the same as last fiscal year.

After issuing more than $100 million in new debt in fiscal year 2018 to fund an aggressive Capital Improvements Plan, fiscal year 2019 contemplates issuing only $3.2 million in new debt while retiring $17,030,000.

The chart on the next page reflects debt service revenue by source as a percentage of total revenue:

Debt Service Fund Funding Sources for Fiscal Year 2019

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Legal Debt Limit

Article Ten (X), Section Fourteen (14) of the South Carolina Constitution of 1895 as amended provides that a City or Town shall incur General Obligation Debt over the eight percent (8%) limit when approved by a majority vote of qualified electors of the political subdivision voting in a referendum authorized by law. 

In addition, Hilton Head Island's Town Council has historically imposed an 80% cap on the debt limit. This year, Town Council further imposed an additional $5,420,355 to bring the self-imposed debt limit to $20,000,000 - which was the amount temporarily needed to respond to Hurricane Matthew. These temporary funds have been fully repaid, but Town Council wanted to prepare for the next storm with this protective measure.

Governmental Funds  ~  Millage Rate  ~  General Fund
Capital Improvement Plan ~ Proprietary Fund ~  Summary