It seems necessary to more precisely define “long-term” and “short-term” debt within the new policy document. This might be specified in terms of number of years or some other type of duration. The policy discussion of uses for various types of debt, e.g. capital improvements versus operations, does shed light on the nature of the debt. But it seems possible that, without adequate definition, it might be possible to simply label a given debt issuance as short- or long-term based on how that debt is to be used. I would be especially concerned if we tried to justify a relatively long-duration debt used for operational shortfalls by arbitrarily deeming it as “short-term”.
It seems necessary to more precisely define “long-term” and “short-term” debt within the new policy document. This might be specified in terms of number of years or some other type of duration. The policy discussion of uses for various types of debt, e.g. capital improvements versus operations, does shed light on the nature of the debt. But it seems possible that, without adequate definition, it might be possible to simply label a given debt issuance as short- or long-term based on how that debt is to be used. I would be especially concerned if we tried to justify a relatively long-duration debt used for operational shortfalls by arbitrarily deeming it as “short-term”.