The Queenstown Lakes District Council (QLDC) considered issuing bonds, among other financing options, in a public-excluded meeting of the finance and corporate accountability meeting yesterday.
Finance general manager Stewart Burns told the Otago Daily Times after the meeting the committee looked at long-term financing options and the advantages and disadvantages of bank debt.
The council needs to find another $46 million to pay for infrastructure upgrades and maintenance over the next three years.
"Council needs to have committed borrowing facilities to deliver its capital programmes over the next three years," Mr Burns said.
"We need to work out what the best way to achieve that is."
Mr Burns said the QLDC would look at bank debt and bond issuances. The main aim was to get borrowing at the lowest cost for the community.
"In the next six months or so, council has to resolve those issues in terms of what it does, but we're at the very start of that process and nothing was resolved."
Mr Burns said bonds were a common practice for local authorities, but the QLDC had not issued them before as there had not been a need. However, debt levels made it prudent for the council to look at all financing options, he said.
The QLDC's 10-year plan forecasts council debt rising to $393 million by 2019. The council has a $110 million bank loan and has drawn down about $90 million to date.
"The question is, do we add to that facility or look at other options, such as bonds."
