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<br />. <br /> <br />. <br /> <br />. <br /> <br />o <br />::e: <br />UJ <br />::e: <br /> <br /> <br />EHLERS <br /> <br />& ASSOCIATES INC <br /> <br />To: <br /> <br />Murtuza Siddiqui, City of Arden Hills <br />Mark Ruff <br />July 12, 2004 <br />TIF District Cash Flows <br /> <br />From: <br /> <br />Date: <br />Subj ect: <br /> <br />Attached are two sets of cashflows for Tax Increment Financing District No 2. The first <br />cash flow (titled "Total Debt Service without Refunding) assumes that the outstanding G.O. <br />TIF Bonds are not refunded and that all future net TIF after bond payments is retained to <br />pre-pay the bonds early. Under current assumptions (no change in tax rates or market value) <br />and a 4% investment rate on future balances, the existing bonds could be completely pre- <br />paid on August 1, 2012. <br /> <br />Please recognize that the attached cash flows do not incorporate any other uses for TIF such <br />as for any interfund loans currently outstanding. It assumes that the cash balance and <br />obligations other than the outstanding bonds are $0 at the beginning of2005. <br /> <br />The second set of cash flows (titled "Debt Service Schedule with Refunding) assumes that <br />the outstanding bonds are refunded but the City retains the net TIF to prepay the bonds in the <br />future. One of the questions from the City Council, as I understand it, is whether or not the <br />refunding is still a net gain for the City if the refunding bonds are paid off early. Under the <br />attached cash flow, the new bonds would be pre-paid on August 1,2012. Even with the <br />higher principal associated a refunding bond and a prepayment in 2012, the projections show <br />the TIF district would save over $94,000 (future value difference between the attached cash <br />flows' end of district balances of$1,51O,000 versus $1,416,000). <br /> <br />We recommend that the City schedule a bond sale in late September or early October, 2004. <br />The attached cash flow assumes that we will achieve interest rates similar to rates from a <br />similar bond sale we held today. By closing after November I, 2004, the new bonds will <br />qualify as a current refunding rather than an advance refunding. The designation as a <br />current refunding allows for lower costs of issuance and greater flexibility in the future. <br /> <br />Please contact me with any questions or comments. <br /> <br />LEADERS IN PUBLIC FINANCE <br /> <br />3060 Centre Pointe Drive <br />Roseville. MN 55113-1105 <br /> <br />Phone: 651-697-8505 Fax: 651-697-8555 <br />mark@ehlers-inc.com <br />