The debt policy of a gmina (commune/borough), powiat (county) or the self-governing structures of województwo (province) is part of the financial policy of local government units (LGUs). Debt policy deals with objectives and activities relating to raising funds from repayable sources of financing. It also defines the goals and principles of debt management with a view to coordinating the units' long-term needs with revenue flow from various sources.

LGUs' debt policy should be constructed within the framework of relevant regulations and in response to the current and forecast financial position of the LGU. Thus, the tasks of debt policy include: identifying the debt level of the local governemnt body consistent with the regulations, selection of priority investment projects to be financed, and designing the structure of their financing by source. These sources may include: own funds, loans, commercial and preference*credits, issue of municipal debt instruments. The scope and level of short- and long-term financing should be defined as well.

Debt policy of LGUs should be elaborated by the units themselves, as its main task is to identify debt limits and establish the principles which will protect the unit from exceeding the regulatory limits. Besides, the fact that a LGUs designs and then implements an explicit debt policy is a sign for investors (e.g. agents investing their surplus funds in the municipal debt securities) and for the rating agencies that the local government unit wants to and can manage its finances. By elaborating an explicit debt policy and later taking efforts to implement it, LGUs also ehance the stability and consistence of its their general startegy.

To develop and implement a debt policy the LGUs are forced to identify the need for repayable source financing, its effects and limitations, the criteria for their selection as well as their their advantages and disadvantages from the perspective of the LGU.