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n ('~ r ~~ V features mean more than a. straight interest rate itself. By figuring the entire interest and number of bond years, you get net interest rate. Net interest rate could be re- duced by calling in. We do not think the Council should put too much stress on interest rate. When we buy an issue pri- vately, we take the issue as set up; we set our basic coupons on that issue in the same way as public sale. We know what bonds have to bear to sell to our customers. Normally, a bond has a ''B" coupon attached. We set that to cover the expenses involved in issuing the bonds. I wouldn't begin to say the net interest rate is the same as at a public sale. We do vary those expenses in a coupon rate. Nfe can tailor it to fit your needs. V~'e can vrait until the contracts have been awarded, you don't erid up with too much or too little money. White Bear has an X850,000. straight issue; they don't need any gimmicks, It is going to run the full length of the 20 year period» They can come aut with pretty standard issue. On this many bonds, put the bidding up for public sale and get the best rates you can. Bonds for schools, court housesycannot be put up for private sale. V'~arkentiens When you speak of assessment, do you mean partial assessment or 100,°x? Olsen: Under the statute, 20~ or more is assessed by law. Shavor: As far as your company is concerned? Olsen: We couldn't buy them under 20~. Graham: This assessment gives rise to what we ran into on sewer prepayments. He is making the point that there are ways at their disposal in negotiating bonds, that they can keep the door open. If we get a lot of prepayments we won't have to issue as many bonds. With the sewer, we had to buy back some bonds at a premium. We would have the right to get them back in an agreement worked out beforehand, and they could sit for 30 days or so to see how the assessments are going to come in. Olsen: Vde find that 10~ prepayment is about average. ?~'!arkentien: These various features are going to have to be compensated in the interest rate. Olsen:. V1e can work it out to get the best call feature without affecting you cost wise.Too many call features can affect you adversely, but it is our fob to advise you, We know what we can sell with ease, and we will advise you to stay away from tough things to sell. We can work this out so you get the best possible plan without it costing too much. Graham: The person you are dealing with will tell you what you can or cannot do. If you put it, 3n .advertisement for bids, you don't know what effect it will have an the bids. It seems to me, on a small issue like this, it is to your advantage to negotiate these things. Suppose we had a X75,000, bond issue which was going to stretch out 20 years, what is the market today and what would be the negotiated interest rate.