Page 87 - 2018 Comprehensive Annual Financial Report - City of Winston-Salem

E. Operating Leases

The City leases land, building space, and certain operating equipment under non-cancelable operating leases terminating during
scal years 2018 through 2023. Renewal options of one to ve years are available to the City under certain of these agreements.
Total expense on operating leases was $427,895 during scal year 2018.
Future Minimum Commitments for Operating Leases
2019 $ 383,758
2020 256,250
2021 241,250
2022 221,399
2023 60,313
Total $ 1,162,970

F. Net Investment in Direct Financing Leases
The City leases the condominium space of the Embassy Suites Hotel/West Tower and Grand Pavilion Ballroom to PM Meeting
Venue, LLC. The lease will expire June 30, 2036, with the option to purchase for $2 million plus the unamortized balance of the
related debt.

Total lease payments receivable $ 12,250,000
Less unearned income (4,074,955)
Net investment in direct nancing lease $ 8,175,045
Minimum Lease Payments
2019 $ 600,000
2020 600,000
2021 600,000
2022 600,000
2023 600,000
Thereafter 9,250,000
Total $ 12,250,000

G. Long-term Liabilities

General Obligation Bonds
The City issues general obligation bonds to provide funds for general government capital improvement projects. The bonds are
direct obligations and pledge the full faith and credit, and taxing power of the City. In November 2014, City residents approved a
$139,200,000 bond referendum that authorized bonds to be issued for road improvements, economic development, housing
development, parks & recreation improvements, and public safety center renovations. On July 12, 2017, the City issued $4,775,000
in general obligation bonds at a net interest cost of 2.8%. The proceeds will be used for public improvements, parks & recreation
renovations, and streets & sidewalk repairs. The City also issued $54,690,000 in general obligation bonds and $4,340,000 in taxable
general obligation bonds at net interest cost of 2.80% and 1.61% respectively. The proceeds will be used for public improvements,
redevelopment, streets, housing, and recreation projects. As of June 30, 2018, $25,505,000 of these bonds were unissued.
Provisions of the state constitution and the Local Government Bond Act, as amended, permit the City statutory capacity for
additional general obligation bonds in the amount of $1.6 billion.

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