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I <br />I <br />I <br />I <br />I <br />I <br /> <br />I <br />I <br />[ [- <br />I <br /> 2. <br />I <br />I <br />I <br /> <br />SPRINGSTED <br />INCORPORATED <br />PUBLIC FINANCE <br />ADVISORS <br /> <br />21 April 1983 <br /> <br />Mr. Lloyd Schnelle~ City Administrator <br />Ramsay City Hall <br />15153 Nowthen Blvd., N.W. <br />Anoka, Minnesota 55303 <br /> <br />Dear Lloyd: <br /> <br />It was enjoyable visiting with you Wednesday. <br />discussed. <br /> <br />This is a summary o'f what we <br /> <br />Ramsey issued $815,000 Improvement Bonds on Seplember I~;~ 1981 at a net <br />inlerest cost of il.70%. The bonds mature in the years 1983 to 1992 and bonds <br />due 1989/92 are "callable" on April !, 1988. The "call" date is relatively short as <br />is the entire bond issue. As the enclosed programs indicate, you cannot save a <br />fantastic amount but the issue does show good potential refunding for its size. <br /> <br />To advance refund, the City must save 5% of the existing interest cost. This is <br />not a problem, but "front" money may result in a problem, at least for a short <br />period of time. This will be covered laler in this letter. - <br /> <br />Schedule A involves a total savings of $61,816. The savings are at the end of the <br />program versus taking a small savings each year. This program would mean the <br />· existing tax levies would remain and you would eliminate half of the 1992 <br />principal payment. The front money required totals $II9,31~;. <br /> <br />Schedule B requires the same front money and we have retained lhe 1992 <br />maturity. However, some savings are taken each year and because front money <br />is not recaptured as quickly, savings increase slightly to $65,803. This schedule <br />may be suitable if you have extra unused funds to tie up in part for three years. <br /> <br />Front money is required because: <br /> <br />The securities purchased for the escrow account cannot carry a rate <br />higher than the rate on the new bonds. We estimate the new issue at a <br />7.25% coupon and the existing issue has a net rate remaining of <br />so most of the difference, but not all, must be made up with front <br />money. <br /> <br />Issuance costs including bond discount on the new bonds is also included. <br />Approximalely 6b,% of issuance costs will be recaptured through <br />allowable earnings in the escrow account. The'portion for which the. City <br />is responsible is included in the front money total. <br /> <br />800 Osborn Building, Saint Paul, Minnesota 55102 (612) 222-4241 <br />250 North Sunnyslope Road, Brookfield, Wisconsin 53005 (414) 782-8222 <br /> <br /> <br />