Debt Report - Quarter 2 Financial Update (2017) (in thousands of dollars)

Debt Update

S&P (Standard & Poor's) has had Niagara rated AA with a stable outlook since April 5, 2001 when S&P and CBRS (Canadian Bond Rating Service) merged their ratings. The ratings reflect S&P's opinion of Niagara's exceptional liquidity, strong financial management, and low debt burden. The stable outlook reflects S&P's expectations that Niagara's after-capital deficits will be moderate; its liquidity will be exceptional; and that its tax-supported debt burden, net of debt on-lent to self-supporting lower-tier municipalities, will remain below 50% of consolidated operating revenue within the two-year outlook horizon. Niagara continually strives to improve our credit rating, as it sends a strong, positive message to investors, and directly impacts our cost of borrowing in the capital markets.

Key Rating Factors	Standard & Poor's Assessment
Institutional Framework	Very Predictable and well-balanced
Economy	Average
Financial Management	Strong
Budgetary Flexibility	Average
Budgetary Performance	Average
Liquidity	Exceptional
Debt Burden	Low
Contingent Liabilities	Very Low

Department	Total Debt as at December 31, 2016	Sinking Fund Asset Adjustment	Total Adjusted Debt as at December 31, 2016	Year to Date Debt Issued	Year to Date Principal Payments	Total Adjusted Debt as at June 30, 2017	Forecasted Principal Payments	Unissued Debt	Total Forecasted Adjusted Debt & Unissued As at December 31, 2017
Niagara Region - Levy
General Government	$16,437	$(243)	$16,194	-	$(514)	$15,680	$(1,074)	$22,799	$37,406
Niagara Regional Police	90,000	(907)	89,094	-	(994)	88,100	(2,799)	16,733	102,034
Roads	86,735	(1,047)	85,688	-	(874)	84,814	(9,323)	105,731	181,222
Public Health	8,269	-	8,269	-	(35)	8,234	(1,413)	12,618	19,439
Community Services	22,910	-	22,910	-	(683)	22,227	(5,988)	19,535	35,775
Niagara Regional Housing	20,306	-	20,306	-	(448)	19,858	(1,766)	8,736	26,828
Planning	121	-	121	-	(29)	93	-	-	93
Total Levy	244,778	(2,196)	242,582	-	(3,576)	239,006	(22,363)	186,153	402,796
Niagara Region - Rate
Wastewater	67,140	(4,640)	62,500	-	(2,625)	59,875	(100)	-	59,776
Water	11,015	(1,154)	9,861	-	(447)	9,414	-	-	9,414
Waste Management	81,149	(5,794)	75,355	-	(3,775)	71,580	(100)	-	71,480
Total Rate	81,149	(5,794)	75,355	-	(3,775)	71,580	(100)	-	71,480
Total Niagara Region	325,927	(7,990)	317,937	-	(7,351)	310,586	(22,462)	186,153	474,276
Debt Assumed for Others (External)	263,756	(1,085)	262,671	-	(5,607)	257,064	(21,733)	-	235,331
Total Niagara Region & External	$589,683	$(9,075)	$580,608	-	$(12,958)	$567,650	$(44,196)	$186,153	$709,607

2017 Debt Issuances

As of June 30, 2017 no new debentures have been issued.

Annual Repayment Limits

• Niagara Region - 7.26%
• Fort Erie - 4.12%
• Grimsby - 0.00%
• Lincoln - 4.54%
• Niagara Falls - 3.58%
• NOTL - 2.79%
• Pelham - 13.00%
• Port Colborne - 6.68%
• St. Catharines - 9.36%
• Thorold - 0.67%
• Wainfleet - 0.21%
• Welland - 10.23%
• West Lincoln - 0.00%

*Calculated with the most current FIR revenue figures available and scheduled 2017 debt servicing charges