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JRAN & MOODY. INC. <br />Mr. Joseph Chlebeck DEC 10. 1976 <br />Little Canada, Minnesota <br />CITY OF <br />December 9, 1976 LITTLE CANADA <br />Page - 2 <br />The advantages of using this vehicle to finance a commercial <br />establishment is of course that the borrower can obtain a lower rate <br />of interest thus making his project more feasible and allowing more <br />cash flow for debt service. In addition the lender can receive <br />interest which, though lower in rate, can result in a higher net, <br />after-tax, yield. Joe, you will be particularly interested in the <br />fact that all financing funds are collected and disbursed by a trustee <br />or the lending institution and therefore the City is relieved of all <br />administrative work. In the remote possibity of any default the <br />worse thing that could happen would be that the mortgage on the <br />property would be foreclosed. NO liability can be placed against <br />the City. <br />It is hard to detail in a letter such as this all of the <br />information relating to this type of financing. Therefore, we stand <br />ready at all times and will be very happy to meet with any interested <br />parties to discuss the matter further in person. To date, the Depart- <br />ment of Economic Development figures indicate that there has been <br />over $575,000,000 of this type of financing for Industrial and Comm- <br />ercial projects in the State of Minnesota. I am attaching a list <br />showing other Minnesota cities that have issued tax-exempt municipal <br />financing for industrial or commercial projects. All other elements <br />of the transaction are exactly the same as in the case of private <br />financing - for example the project pays real estate taxes and all <br />other benefits such as increased valuation, emnlo_vment, etc. inure <br />to your City. <br />We respectfully request the privilege of being placed on the <br />agenda for your January 12, 1977 Council ni ehing. <br />If you have any questions or desire additional information <br />please contact me. <br />Very truly yours, <br />JURAN & MOODY, INC. <br />Robert R. Sander <br />Vice President <br />RRS/ lh <br />Encl . <br />cc: Air. Donald Valento Mr. Richard E. Buss Mr. Fred C. Bolstad, Jr. <br />Mr. Robert DeBace Mr. Clayton Parks Mr. Robert Schroeder <br />Mr. Raymond Hanson Mr. Donald Carley <br />Mr. Morris E. Jesperson <br />Mr. James Vei l leux Mr. John Friedmann <br />.e <br />ti' <br />